Business strategizing for the new year may seem all but simple, with fragmentation, uncertainty, and volatility as constants in a world that shifts here and there across all sectors.
The finance function in organisations has been proven to not be spared from such changes, as it evolves to cater to the requirements imposed by the current market situation.
With this, it is important that finance leaders fully understand their roles in driving strategic imperatives within their organisations in 2024.
“Value, at the macro level, is a belief that CFOs have two key objectives: to protect value and to create value.”
“Protecting value to me is about being trusted and getting the fundamentals right. That means timely, accurate, and relevant reporting,” Scriven says, adding that it also equates to effectiveness in operational processes.
As for the role of finance in protecting value, he thinks that it plays a critical part in protecting the interests of customers, investors, and regulators.
He points out that finance has been increasingly stepping up to a position to protect data and ensure it is used accurately across the organisation.
“In my experience, companies that do the fundamentals well typically simplify, standardise, and automate their core processes, reporting, and controls,” Scriven says, “that means they can be more efficient and effective to focus their resources and time more on of the value creation activities.”
For Scriven, value creation is finance’s role in assessing, driving, and influencing better business outcomes.
“That starts with helping to set the business strategy,” Scriven points out, adding that finance must also be present to ensure that robust planning targets effective capital allocation.
He says that the CFOs he talked to all say they would like to spend relatively more time on value creation and less time on the fundamentals.
“The ambition is always to create more value by being more influential and ultimately driving better business outcomes.”
A constant evolution
To meet the future needs of the business, the finance operating model must undergo constant evolution.
Scriven says this is particularly focused on the mantra of being better, faster, and cheaper, which ultimately is about building better capabilities and being able to clearly articulate.
He highlights that there are five main areas finance must go for in building better capabilities: strategy and growth, performance management, operational excellence, insightful reporting, and transformation skills.
Additionally, to be better, faster, and cheaper, finance leaders must embrace and leverage new technologies.
Process and people
Scriven sees a big evolution in process in people in 2024 where finance will be moving away from traditional structures based on activities to more integrated teams that are outcome-based.
“I see that as a really positive shift because it encourages more diversity of skills,” Scriven says, adding that this enables multi-disciplinary working and creates more capacity for value creation.
AI and automation
This is despite the job security concerns raised by some as technology might be replacing people and taking over their roles.
“Honestly, we absolutely have to embrace these technologies as finance professionals, because the world, and finance as well, is becoming increasingly complex to a point whereby we need to find ways to reduce the risk of errors and find ways to reduce reliance on manual processes and controls.”