CFOs are steering the direction of digital transformation
After a tempestuous year, “CFOs are being pulled in many more directions than they historically have as it relates to transformation efforts. Are they leaning in more? Are they being asked to do more? The short answer is, yes.” That’s what Steve Gallucci, Deloitte’s U.S. national managing partner and head of its CFO program, told me.
Deloitte’s Q2 2021 CFO Signals report, released today, is based on a survey of 138 CFOs in the U.S., Canada, and Mexico. About 70% of respondents work at public companies, and 30% at privately held companies, according to the report.
Many of the changes at these companies are driven by consumers, the industry, and “new business models threatening existing business models,” says Gallucci. When it comes to digital transformation, many CFOs are leading the way: 42% of CFOs said their primary role is co-leader, and 16% said leader, the report found. Often, CFOs are asked to help “develop and champion the coherent data strategy,” that is embedded into the transformation, Gallucci explains.
When it comes to shifting company-wide strategy and offerings, CFOs also play a key role in decision support, such as “helping business units understand the impact of changing supply chains, changing demand, and customer demand,” he says.
CFOs have increased their expectations for domestic hiring, the survey found. Retail and technology industries reported the highest expectations, while those in financial services industries had the lowest growth expectations for domestic hiring. CFOs worry about finding the right talent to meet the digital transformation they’re spending a lot on, Gallucci says.
“In general, CFOs who we’ve talked to are looking for employees with a skillset that is tech fluid and can employ these new and emerging technologies around A.I. and blockchain,” he says.
Many CFOs surveyed are also involved in supporting the company’s diversity, equity, and inclusion goals. About 48% said their companies report DEI representation metrics to investors and other stakeholders, and 50% said DEI goals are linked to performance evaluations, according to the report.
In general, the survey indicated CFOs have increased optimism, Gallucci says. “In terms of the overall assessment of the economy, I think what we saw is a continued trend upward,” he says. “Net optimism was up, and prospects for the company’s success looked to be trending up. Risk appetite remains high, and there continues to be a strong attractiveness for both the debt and equity markets.”
However, when asked what they considered external risks to financial wellbeing, most CFOs pointed to the potential for inflation. “Coming off the lows of 2020 and 2021, a question in CFOs minds is ‘how long will the upward trend last?’” says Gallucci.
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