The industry has been and is likely to remain challenged on several fronts. The balance of power between brands and their customers is shifting — and the needle has moved significantly towards the consumer. A levelling competitive and financial playing field has brought numerous innovative digital-first brands into the market.
It makes “relevance” the core competitive battleground for consumer brands. Companies are being challenged to create products, services and experiences that meet consumers’ individual needs at just the right moment. That’s changing the rules of the game, and overturning decades of conventional industry wisdom.
To find new growth, brands must solve these challenges, injecting agility across the business, leveraging a wider ecosystem of partner and delivering relevance at scale for a marketplace of millions of individuals.
Enter The New CFO
Chief Financial Officers have a crucial part to play in driving change forward. In fact, Accenture’s latest research reveals how much the role of the CFO is evolving across all industries. With access to deep financial and business insights, CFOs are ideally placed to build the case for change. They can also target operational improvements and the use of new digital technologies to drive efficiencies in the core business that will fund a pivot to more profitable growth.
Here are five ways CFOs can ensure individual consumer relevance on a global scale:
#1 Digitalize finance – then the company. Using finance as a testing ground to explore new digital technology and the greater use of automation and artificial intelligence, CFOs can leverage the lessons learned to drive broader organizational change. Indeed, the research shows CFOs increasingly see themselves as “value champions” and “transformation drivers.” Four in five of those Accenture surveyed said targeting areas of new value across the business is a major focus. And nearly the same proportion said they lead efforts to use digital technology to drive enterprise-wide transformations.
#2 Harness data for insights. CFOs understand the value of speed and agility to a business — and how real-time data visibility supports it. More than half of those surveyed said they’re working towards real-time analysis of business performance today (and a huge 89% expect to say the same in three years’ time). They also say that inconsistent, inaccurate and inaccessible data is the greatest challenge they face in their day-to-day work.
Today’s CFOs are taking a lead on data governance. Understanding the value of data as a strategic business asset, a large proportion of surveyed CFOs (84%) say they’re taking responsibility for their organization’s data governance. That’s more than in any other industry surveyed.
#3 Develop the future finance workforce. CFOs are taking a more holistic approach to planning their future talent needs (including blending human and machine intelligence and innovative digital technologies). They see how their own role profile is changing, with anticipating and managing risk, long-term strategic thinking, and insight into new technologies fast becoming vital CFO capabilities. And they see that change reflected in the wider finance organization too: innovation talent is now the most highly desired skillset for junior finance staff.
#4 Drive a deep transformation of operations. Operational efficiency is central to driving broader change because it’s the most effective and sustainable way of freeing up capital to invest in a pivot to the new. CFOs are increasingly looking beyond SG&A expenses and using methodologies like zero-based budgeting (ZBB) to target efficiencies in the cost of goods sold (COGS). Accenture’s research has shown that ZBB can lead to rapid COGS savings of up to 10%.
#5 Be the architect of value. To realize the goal of achieving consumer immediacy and relevance on a big scale, companies need to adapt their supply chains to support customer personalization across a wide array of channels. That’s a complex endeavor — and very difficult for an individual company to do alone. Most will need to leverage a much wider ecosystem of partners across the value chain. This is another area where CFOs can support change: bringing a data-driven approach to selecting new partners for the business, ensuring the process remains focused on outcomes that add value.
Ultimately, this evolving role for CFOs is about expanding influence across the business. CFOs are now strategy players who are expected to use their knowledge of data, analytics and finance to forge new cross-organization strategies while influencing and guiding business units. As the marketplace continues to change so quickly and so profoundly, talented CFOs will be increasingly vital in delivering consumer relevance and capturing new growth.
Paul Prendergast is managing director for the Consulting practice in the products industry at Accenture. Prendergast works with CFOs and finance teams across the retail and consumer goods industries, helping them to innovate, transform their businesses and drive greater value from intelligent business operations. He has more than 20 years’ experience in consulting and is the author of The CFO in Retail, a study of how retail CFOs are creating new value from data and digital technologies.