Among their wide range of financial duties, CFOs are occasionally required to perform a task that is vitally important for their finance department, and the organisation as a whole: convincing the company’s CEO to adopt a proposed financial solution in order to optimise the company’s finances and accounting processes.
Once a CFO realises the improvements that changing accounting and financial applications can create at the company, they have to get the CEO to see the same thing to spark their interest. It’s a necessary step whenever the CFO doesn’t have full authority to make this decision themselves.
In this context, two different situations can arise, either easing the task or making it even more complicated:
- The CEO has a solid financial background and has previously worked in finance, including as a CFO. In this case, convincing the CEO shouldn’t be difficult, as they will quickly see the advantages described by the CFO.
- The CEO’s profile is more business-oriented or technical. Many CEOs have reached the top of the company hierarchy following a career in business, or come from technical disciplines such as engineering. In this case, the CFO will have to make an even greater effort when it comes to communicating the benefits their proposed software change can provide.
What Arguments Can CFOs Use to Convince CEOs That Changing Accounting and Financial Software Is a Good Idea?
CFOs have to be familiar with their company’s CEO in order to adapt the language they use in their proposed change to the company’s financial solution. In other words, if the CEO’s background isn’t in finance, it doesn’t make sense to go into detail about how the solution can improve IC reconciliation, for example.
CFOs can use a variety of arguments, but the following may be particularly helpful:
- The existence of assistance and subsidies for purchasing the solution: This has to be a supporting argument used after listing the other advantages of acquiring a new financial solution. Right now can be a good time for making changes to financial solutions, as assistance to support companies in their digital transformation process is currently available at the European level, channelled through the funding provided by the NextGenerationEU initiative. In Spain, it is already available for SMEs with fewer than 50 employees, which can receive a digital voucher of up to €12,000 that can be used to improve their accounting and financial processes, among other things.
- It will improve finance department productivity: Accounting and financial software is the work tool used by accounting and finance department staff. As a result – just like a lumberjack needs a sharp axe to cut trees more efficiently – accountants and financiers need software that makes their work easier, reduces the time it takes to complete their tasks, and eliminates routine tasks that do not generate added value for the organisation.
- It’s an investment, not an expenditure: Improvements to a company’s accounting and financial software constitute an investment, not an expense. The return on this investment will be more productivity greatly exceeding the annual expense of the application’s depreciation. Therefore, investing in better accounting and financial software for the company will result in cost savings.
- It will improve the company’s internal control: Improvements to the company’s financial solutions will make it possible to allocate less resources to routine and repetitive tasks, thereby freeing up human resources in the finance department to improve the company’s internal control.
- It will optimise the record to report (R2R) process: This process facilitates finance and accounting (F&A) management, as it consists of the timely and accurate collection, processing and provision of relevant information. As a result, improvements to the company’s financial solution will result in improvements to accounting closure processes and financial consolidation, and will reduce the time it takes to prepare the company’s internal and regulatory financial reporting (disclosure management). Optimising the report generation process makes it possible for directors to receive strategic, financial and operations feedback quickly, giving them insight into the company’s status.
While taking the initiative to make changes to a company’s financial solutions isn’t easy, making the decision to incorporate Corporate Performance Management (CPM) software for finance, will help the company to have more reliable and efficient processes by improving data quality, simplifying financial process management and automating financial report generation, easing decision-making.
LucaNet offers easy-to-use software and high-quality advice on Financial Performance Management. Its consolidation, planning, reporting and data management solutions make the complex work of group CFOs, controllers and accountants much easier. Proof of this can be found in its 3,500 clients in more than 50 countries. Learn more:
Fast and efficient consolidation is easier than you think. We show CFOs and finance managers how they can easily optimise the financial consolidation.
What makes chief financial officers successful? How and why do explicitly people in this position guide their growing company safely into the future? We asked two experts who should know the answer.
What specific challenges are presented by the changes to the CFO's role in an enterprise? And how can a CFO use a professional corporate performance management software solution to tackle the challenges of the current market efficiently? This white paper will provide you with valuable tips for your future practice.