The job of the CFO is changing faster than at any time in recent history. No longer exclusively about accounting and reporting, finance leaders now have to be savvy technologists and embrace emerging tools like generative artificial intelligence, automation and advanced analytics.
These technologies — AI in particular — will soon be part of the very DNA of every finance department. Ignoring their potential benefits, delaying AI investments or mistakenly considering AI and technology the purview of other business leaders could be costly mistakes — and cause organizations to fall behind in a market increasingly enhanced by real-time data and automation.
It's imperative that CFOs become fluent in AI, understand how it can create value, and become comfortable with transforming how their departments operate.
How AI is changing the office of the CFO
As gen AI adoption continues to surge, many organizations are launching so-called "sandbox" large language models to let employees safely experiment risk-free. In some places, it's already transforming finance departments. Whether it's automating forms, improving financial projections, or crunching ever larger datasets to unearth previously hidden enterprise insights, AI is giving finance departments capabilities they never had — or at least never had at scale.
Imagine that your reports and updates come to you in real time, in easy-to-digest formats instead of at the end of every week or month. Tasks that now take hours, or longer, are done in seconds. These and other innovations will save substantial amounts of money and time. And, despite what many fear, AI is far more likely to enhance human work than replace huge numbers of workers. In some places it may result in increased headcount along with increased productivity.
But achieving this will require that CFOs take several important steps. Here's how to get from here to there.
Think big, but act small — for now
No two organizations have quite the same set of needs, and even two companies in the same industry may find themselves using AI for dramatically different purposes. The best use cases for your finance office might not be entirely obvious at first, so initial AI investments should keep both your long-term strategy and your immediate realities in mind.
Many CFOs will probably start out aiming for practical, tangible use cases that deliver clearly measurable results, like automating purchase orders, contract writing or detecting duplicate payments. As you become more comfortable with using AI for basic processes, then it makes sense to apply AI to higher-value tasks, like earnings or cash-flow forecasting.
Do your research to learn what has worked and not worked at other organizations. As you start implementing your own applications, use data and analytics to track your progress. And, critically, make sure you always have the ability to change course — the evolutionary path of AI is as unpredictable as any technology ever has been.
How to evaluate potential AI investments
After identifying use cases appropriate to your organization, evaluate existing solutions in the market first — but be aware that building your own may make more sense than buying one off the shelf. Look first for products and processes that can be implemented easily and quickly, that have little risk and show results that are tangible and easy to understand.
It's safe to expect that many applications that CFOs have come to depend on — like enterprise resource planning — will face substantial disruption from AI. So be careful about locking long term into a relationship with any single vendor or solution now. Always be cognizant of the need to scale your successes over the long term.
It's also important to establish a governance committee or individual that is responsible for both scaling your AI successes and minimizing organizational risk. Ideally this person or group would understand both the technology and your business.
The critical skills for tomorrow's CFOs
As AI changes finance departments, it will also change the kinds of skills a successful CFO will need. Traditional areas of expertise like accounting, projecting earnings and resourcefulness are not obsolete and will still be critical. But they are not likely to be sufficient by themselves.
One new skill CFOs should master to stay competitive: prompt engineering — the process of designing and refining language and prompts for LLMs. Doing this well requires learning how to be clear and specific, provide context, and avoid open-ended questions. In a similar vein, CFOs of the future will need to translate the data and insights their tools uncover into clear, coherent narratives that resonate with other business leaders and help inform business strategy.
CFOs should expect the traditional silos of different roles either to intermingle or break down completely. It's conceivable that tasks normally performed in the office of CFO will become scattered throughout the organization. This is because the data that fuels AI innovation — and dramatically improves finance functions — is already located throughout the organization. Setting up structures to surface and direct it to where it needs to go will require the cooperation of other executives, like the chief information or chief technology officer.
How CFOs can prepare to become tech- and data-savvy
Wherever your organization is on its AI journey, there are a few things you can do now to prepare yourself — and your finance function — for the future.
Get your data in order. This is likely easier than it may sound. The process doesn't have to entail a huge investment of time or capital; sometimes it can just mean setting up data governance or restructuring a cloud stack — but, regardless, you cannot have AI innovation without organized data.
Educate your team. Your people will need to have a realistic understanding of AI, its capabilities and its limits — not just hype. Explain how you imagine AI changing the CFO office and give people opportunities to experiment with the technology as you pursue that vision.
Understand what new skills you and your team will need. STEM skills are of course important, but one thing that will become clearer in the AI age is that uniquely human skills are even more so. Technology will not replace critical thinking, creativity and ethics.
Look for easy wins. Start by building applications that are low risk and show tangible results relatively quickly. This is how you build trust among your team and buy-in from other parts of the C-suite.
Preparing the CFO for the AI age
The skills needed by finance departments — and the technologies at their fingertips to innovate along with their organizations — are changing quickly. The path forward may appear steep at first, but the rewards at the summit — real-time data, intelligent automation, game-changing market and enterprise insights — are potentially enormous. By becoming AI savvy, finance chiefs can enable their departments to lead the way in transforming their organizations.
