The CFO as Chief Growth Officer

Finance Executive Insight I The Hackett Group I 4 © 2018 The Hackett Group, Inc.; All Rights Reserved. | 3000174 Defining world-class performance For the purposes of ranking the performance of finance, along with human resources, information technology, procurement and other business services, The Hackett Group has defined process groups, incorporating individual processes, sub-processes and activities. Further, we collect data on staffing, costs and best practice utilization for each function and process group. To identify the world-class organiza- tions in our database, we analyze these performance metrics using a proprietary value grid. Metrics associated with efficiency are scored on the horizontal axis (also known as the “X” axis). These may include such output measures as cost as a percentage of revenue and cycle time. Performance metrics associated with effectiveness are scored on the vertical (or “Y”) axis. Each company is ranked relative to the others in the comparison group. Those above the break-points of the top quartiles in both efficiency and effectiveness are designated as “world-class overall.” With the help of a TMS, treasury teams can provide the CFO with a more holistic view of risk through enhanced integration with bank systems and operational applications, as well as and third-party information (e.g., news feeds). Conclusion Rather than simply acting as financial custodians, CFOs today are party to all major strategic decisions. They bring credibility and value to discussions about how to increase shareholder value not only through cost-cutting, but also by selecting and funding growth opportunities, while protecting the company from risk. To deliver on this expanded mandate, CFOs must: 1. Shorten the cash conversion cycle by leveraging technologies and supply chain financing techniques to decrease DSO and extend DPO. 2. Gain complete, real-time visibility into global cash by consolidating the arduous task of logging in to individual bank portals into a single, automated solution that streamlines that activity and delivers a timely, accurate update of the company’s cash position. 3. Optimize their liquidity management approach, taking advantage of complete cash visibility to reduce external borrowing, maximize investment returns and sharpen their forecasting capabilities. 4. Create a holistic view of risk and go beyond their traditional financial risk management purview to include strategic and operational exposure, in order to protect the company and ensure it can achieve its strategic objectives. FIG. 3 Risks included in enterprise risk management program Source: Enterprise Risk Management study, The Hackett Group, 2017 ABOVE $10 BILLION BELOW $10 BILLION Geopolitical Compliance Financial Cyber Strategic Regulatory Reputational Operational Other 89% 58% 89% 89% 78% 78% 78% 79% 67% 56% 33% 13% 83% 83% 83% 88% 88% 88% Percentage of organizations