Playing their part in the wider corporate strategy is now the top priority for CFOs who no longer rank cost reduction at the top of their agenda. 

 

According to the 2010 IBM Global CFO Study of more than 1,900 CFOs and senior finance leaders worldwide, cost reduction has slipped down the list of priorities despite the global economic crisis. Instead, CFOs are pursuing their own ambitions more fiercely and cite their roles as strategic advisors to the business as being more important.  More than 70% of those polled say that they already play a critical role in enterprise risk mitigation, business model innovation and selection of the key metrics linking performance to strategy execution. 

 

The survey found that CFOs were feeling pressured to help their organisations respond to "the new economic environment". Their priorities for the next three years were to cut the enterprise cost base, make decisions faster and provide more transparency to external stakeholders.

 

But finance executives are aware of their own shortcomings in the areas of supporting, managing and mitigating enterprise risk as well as driving integration of information across the enterprise. Only half of respondents felt they provided effective insight into how their businesses really worked.

 

But there are exceptions to this as IBM noted in its report: “Our 2010 study uncovered a select group of Finance organisations – called Value Integrators – that have found a way to excel. In every area of the Finance agenda, their effectiveness surpasses their peers. Not only are they better at helping their businesses navigate uncertainty and complexity, but on every financial measure assessed, their enterprises outperform. Since value integrators enjoy proportional representation across various dimensions of the data sample, their performance signals a better practice and is not just a consequence of industry, geography or company size." 

 

"Never before has the importance of strong Finance capabilities been highlighted more than during the recent global economic downturn," said William Fuessler, global leader, financial management, IBM Global Business Services. "Our study shows that CFOs are expected to provide fact-based leadership and strategic decisions grounded in sophisticated analyses to help navigate the enterprise through these new economic waters."