CFOs Can Create a Business Culture That Embraces Change and Generates Value

In recent years, CFOs have successfully made the leap from record-keepers to business partners. But organizations now need their CFOs to provide even more—finance leaders must evolve from business partners to value partners.

Traditionally, CFOs have excelled at knowing where the finance information is and providing insights based on that information. But increasingly, information and insight are being automated by cloud-based technologies, said Ash Noah, vice president and managing director, learning, education, and development, at the American Institute of Certified Public Accountants (AICPA). Noah spoke as part of the 2022 AICPA & Chartered Institute of Management Accountants (CIMA) CFO Conference keynote session “Moving From Business Partner to Value Partner: The Next Evolution of Finance.”

“We’re no longer report generators. We want to move toward being value generators,” he said. “The CFO is the new CVO: the chief value officer.” 

Going forward, CFOs will need to focus on using their influence to deliver impact and to adopt a more agile, iterative approach.

To discuss how technology can help CFOs morph from business to value partners, Noah was joined at the 2022 AICPA & CIMA CFO Conference by Workday Co-President Robynne Sisco and Jeff Jacoby, Workday’s principal financial lead. In addition, Brad Floering, vice president of finance at Snowflake, and Gwen Shaneyfelt, executive vice president and chief accounting officer at Franklin Templeton, shared on-the-ground examples of how they use cloud-based management software to become value partners.

4 Principles of Value Creation

Since our start in 2005, Workday has experienced soaring growth. From 2012, when the company went public, to fiscal year 2021, Workday saw a consolidated annual growth rate of 41%. In our most recent fiscal year, we earned over $4.5 billion in subscription revenue—20% more than the previous year. Today, the Workday Enterprise Management Cloud supports more than 9,500 customers operating in more than 175 countries, with solutions that include Workday Financial Management, Human Capital Management (HCM), and Spend Management.

With our rapid rise and expansion, Workday has had to figure out how to keep working with speed and agility. We needed to act like a startup—but at scale. The management software wasn’t an issue; Workday uses our own products to run the business. But we needed to create an organization that could keep up with continual change. To achieve that, Workday created a framework for digital finance acceleration and value creation based on four principles: agility, insight, collaboration, and innovation.

1. Agility. An agile mindset relies on collaboration, as well as testing and validating assumptions, Sisco explained. It also means seeing business processes not as fixed entities but as living, breathing things. “Your processes have to be continuously evolving as your business evolves—and to do that, you have to have a team that’s going to reimagine every single thing every day,” Sisco said. With our agile culture, Workday was able to undertake three acquisitions during the most recent fiscal year and fully integrate each organization in just three weeks or less.
2. Insight. Historically, finance functions have been the organizational bottleneck. The financial information was all there but needed to be pushed out manually to the rest of the organization, a time-consuming process. Workday’s applications can ingest various data—financial, people, operational, and third-party data—and get it into the hands of decision-makers via simple, intuitive dashboards that compare forecasts to actuals. That way company leaders can make decisions based on real-time data. “We call it the democratization of data,” Sisco said. “It takes finance out of the bottleneck.”
3. Collaboration. Workday Enterprise Management Cloud enables collaboration across the entire organization, which in turn drives continuous innovation. With greater automation of business processes, finance and other functions can spend more of their valuable time becoming value architects. “It’s not just collaboration within finance or between finance and IT on systems and technology but really also including the entire business,” Sisco said, emphasizing the need to work outside of departmental silos and using empathy to add perspective. Such collaboration has led to initiatives such as the zero-day close, which is closer to becoming reality through continuous improvements.
4. Innovation. An always-innovating organization requires a shift in culture and mindset. It involves developing next-generation finance professionals who don’t just live in and work in spreadsheets but think innovatively and learn continuously. Organizations can provide projects and other opportunities to keep their people charged and learning nonstop, while making sure that finance teams are using the latest tools and technologies that make their jobs easier. “About 45% of our revenue goes back into research and development, to give both our internal and external customers access to the latest innovations,” Jacoby said. Workday, for example, achieved a 58% gain in staffing efficiency between fiscal years 2013 and 2021, resulting in $6.3 million in annualized general and administrative cost avoidance.

Snowflake: Actionable Data

Snowflake, which enables companies to centralize and analyze their data, grew from just 250 employees to more than 4,000 in the past five years. As a startup, Snowflake kept its financials in spreadsheets and other siloed sources. “None of that data is actually actionable. It really only tells us what we’ve done in the past,” Floering said. Snowflake needed to get better at forecasting revenue, which is difficult for a company that charges customers based on their usage of its product.

Floering wanted Snowflake’s finance team to do more with its data—to become a value partner driving decision-making. “I wanted to get out of the cadence of just reporting the numbers,” he said. 

To do so, Snowflake partnered with Workday to automate its financial, human resources, planning, and budgeting processes. Using a combination of Workday Adaptive Planning and the Snowflake Data Cloud, Floering and his team have accelerated their ability to forecast revenue, anticipate costs, and understand consumption for each customer, with significantly less effort.

Automated processes have also helped Snowflake manage its explosive growth in revenue and people. As Snowflake’s revenue jumped last year from $590 million to $1.2 billion, hiring managers were simply told to hire as many people as they could. But that created a reactive hiring pattern that made it hard for Snowflake to get the people it needed when it needed them.

“Financial planning and analysis was spending so much time reconciling headcount, it was painful,” Floering recalled. “When we moved onto Workday Adaptive Planning, we connected the system with Workday HCM, and now we are able to push our headcount forecast data into Workday. Our plan has become dynamic.” 

Today, with up-to-date employee data, hiring managers know exactly what kind of people—and how many—they need.

Franklin Templeton: Championing Change

With $1.5 trillion in assets under management, Franklin Templeton is among America’s top 10 asset managers, and growing. Over the past few years, the firm has acquired asset manager Legg Mason, custom index provider O’Shaughnessy Asset Management, and secondary private equity investor Lexington Partners, among others. Based in San Mateo, California, the company used its acquisition of Legg Mason to not only double the volume of assets under management, but also as an opportunity to completely rethink its finance organization and how it creates value for the business.

The company held a brainstorming session where it considered all the potential ways that the business might want to see the data, recalled Shaneyfelt. “We also thought about self-service and how we could deliver information to people in a way that makes sense to them,” she said.

Already a Workday HCM and Workday Payroll customer, Franklin Templeton opted to standardize on Workday Financial Management and Workday Adaptive Planning to support its new finance operating model and empower end users with access to real-time information.

Shaneyfelt acknowledged that the last few years have been quite busy for her finance team, integrating acquisitions and adopting new digital finance technologies. It’s important for organizations to consider how they can change their processes and systems without overwhelming the people tasked with executing the changes.

“Think about their level of burnout with the change and how you can make it exciting and where you put in little breathers,” Shaneyfelt said. 

Franklin Templeton also manages change with a talent optimization program: The company posts interesting new assignments for which anyone can volunteer. That keeps leaders from tapping the same go-to team members time and again. Plus, the company allows employees to shift to different roles for a few months each year. 

“Learning is the most exciting part of the process, and if you have the right people, they want to learn new things,” Shaneyfelt said. Also indispensable? Change agents who promote and champion the changes to build awareness and enthusiasm in the organization.