What Is The Role of The Finance Director?

Technology is changing the role of the finance director in all types of businesses, as automation and artificial intelligence spread into every function. As a result, finance personnel need to learn new skills and retain their ability to add worth to the business.

The role of finance

The role of a finance director is undergoing significant change, as technology automates swathes of the finance function in every business. But the shift provides an opening for those involved to contribute at a strategic level of the organisation. Finance people are often seen as merely guardians of expenditure, as they scrutinise budgets and track how and where money is spent. But at a time of disruption driven by rapid changes in technology the finance department needs to be reinvented as a source of ideas, expertise, and opportunity.

Without adopting such an approach its traditional influence will shrink as algorithms drive greater efficiencies and lower costs. And without finding ways to contribute at a senior level the authority of finance personnel will diminish. For those involved, it is important to review every aspect of the discipline to make sure it stays relevant in a world powered by technology. Otherwise, the dominance of finance will wane to become a sub-function of technology, as it offers prized insights through the gathering and dissemination of value leaden information.

The need to reinvent the role of finance is driven by a very simple trend: technology. Technology and its vast and ever growing family of apps and algorithms unsettle everything, not least by reducing the number of staff required to complete repetitive and routine tasks. The automation of back office activities is of course welcome, as it frees up resources and generates otherwise unfound productivity gains.

Transforming finance

The management of every business is undergoing major transformation, as the basic reporting of historical data shifts to a more dynamic model that informs and shapes the decision-making process. Such change needs creative and flexible thinking, as the level of disruption challenges those charged with financial responsibility because they are always expected to outpace changes in technology.

The focus of finance is also shifting from the passive reporting of profit to that of making sense of, and finding potential in, the endless quantity of data that flows through the business. Such insights build on the finance function but also require an ability to interrogate information and present it in a simple way that communicates effective messages to non-financial managers. This of course raises questions, as the skills mix of finance people must now include an understanding of how to use technology to improve business performance in all areas of activity.

So, the role of finance director is undergoing significant change and needs to be reimagined as technology challenges its traditional position in senior management.