The role of the Chief Financial Officer (CFO) has been evolving for many years, and it is changing at the speed of light. Gone are the days when the CFO was solely responsible for the company’s financial health. Today’s CFO, while most likely holding an advanced degree in accounting or finance, must also be equally savvy in information technology. This role now interacts equally with IT, Sales, Marketing, and Operations, adding a valuable perspective to other areas within an organization.
Here, we look at the changing role of the CFO and what it might mean to your nonprofit.
The Modern CFO: Where Technology and Finance Meet
Throughout the accounting profession, technology has become an ever-present companion to the routine of credits, debits, invoices, payments, and payroll.
Smart accountants keep up to date with the latest tools and technologies available to enhance their productivity:
- Cloud-based accounting programs that provide robust yet cost-effective financial management
- Data and analytics programs that provide additional insight into forecasting, analytics, and financial health
- Grant and donor management software which enables organizations to manage financial outreach activities more effectively and track activities to income
- SMS and text messaging platforms that can be linked with donor management programs for immediate financial outreach
- Artificial intelligence as incorporated into existing financial tools to pinpoint errors and speed lookup of important information
- Developments in blockchain, cryptocurrency, and related fields
- Cybersecurity, so as to protect critical information in the finance department from theft, hacking, and extortion
- Best practices from the for-profit world in sales, marketing, and operations, which may be adapted to the nonprofit world
As you can see from the list above, the CFO, as leader of the organization’s financial team, needs to stay abreast not just of the typical regulatory compliance issues but the realm of software and technology.
CFO and CIO: Collaboration to Achieve the Same Goals
Although the daily tasks of the CFO and CIO may differ, there are many areas of overlap between their roles today. Shared goals among the C-suite leaders of an organization mean that the two roles must work in tandem to achieve positive outcomes.
The CFO should be included in any major software selection processes. Many become the Executive Sponsor of a software project, providing teams with a valuable link to the leadership team to represent their work. Their unique insights into how a particular platform or software will impact efficiency, productivity, financial health, etc. are invaluable.
Other areas where the CFO may be concerned with technology include protecting critical data. The finance or accounting team may process donations, membership fees, and other financial transactions that contain personally identifiable information. Such information is a tempting target for thieves. The CFO must know the basics of cybersecurity and work closely with the CTO or CIO to ensure data is kept secure. This includes customer information, donor information, credit card information, and sensitive organizational financial data.
Because the CFO understands all areas of the organization, they should be an essential voice in any decision involving technology. But don’t limit your CFO to money and tech. They also play a vital role in marketing, sales, and operations, sharing their experience and a keen eye for efficiency and cost savings with the team.
The changing role of the CFO has opened exciting vistas for this once-strictly financial position. Variety is the spice of life, and for those interested in finance and accounting, embarking on a career that leads to the CFO chair means an ever-changing field of growing opportunities.
Welter Consulting bridges people and technology together for effective solutions for nonprofit organizations. We offer software and services that can help you with your accounting needs. Please contact us for more information.