Savvy CFOs work closely with CEOs and other senior leaders to embed differentiating capabilities across the enterprise. They know that an innovation strategy, sufficient funding, developing talent, a KPI dashboard for the boardroom and the C-suite, and a supportive ecosystem are table stakes.
In addition, CROs can shape the disruption playbook by:
- Setting the tone for agility and customer focus
- Delivering better data sooner for smarter decisions
- Centering strategy on customer experience
- Driving real AI adoption with measurable outcomes
- Building agile organizational structures that accelerate innovation
- Fostering fast-learning cultures to stay ahead of threats
Bottom line: The faster organizations act, the faster they can move toward disruptive leadership. CFOs can be a catalyst to making high-quality, high-velocity decisions.
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Disruptive leaders transform industries by operating in fundamentally different ways than their competitors. Savvy CFOs recognize this and work closely with their CEOs and other senior leaders to ensure these differentiating capabilities are embedded in the enterprise.
As I’ve discussed in summarizing the results of the second annual Global Board Governance Survey, conducted by Protiviti, BoardProspects and Broadridge Financial, organizations that radically transform their industry and/or launch new industries distinguish themselves from less disruptive organizations in a number of ways. Specifically, they:
- Embrace artificial intelligence (AI) as an opportunity
- View technology modernization as a high-priority, high-ROI initiative
- Build an innovative culture
- Deliver superior customer experiences
While not every company can be a disruptive leader, CFOs should commit themselves to helping the organization drive each of these disruption-related priorities to ensure their organizations remain competitive. This should come as no surprise, of course. Everyone who has operated as a finance leader in recent years has firsthand experience with the accelerating nature of the finance function’s transformation. CFOs now have the opportunity to apply their core finance competencies to a wide range (broader than ever, in fact) of non-finance challenges throughout the enterprise. And all of this while CEOs and their boards are trying to figure out the answers to the questions around investing in AI and other technologies — for example, the who, what, where, how, why and how much.
To illustrate, CFOs have assumed principal roles in cybersecurity, strategic sourcing and enterprise responses to tariffs. In addition, as overseers of the organization’s financial activities, many CFOs champion technology modernization initiatives that align with business strategy and objectives. These initiatives optimize costs while enabling the organization to leverage the full value of AI and other advanced technologies — and, most importantly, generate the ROI expected in these emerging areas.
Further, it turns out that technology modernization also improves the organization’s ability to disrupt by laying the foundation needed to support digital transformation of processes, products and services. Thus, CFOs can help CEOs and their executive team peers ensure the continued viability of the strategy and business model in light of swiftly changing market fundamentals as well as disruptive threats and opportunities.
The CFO’s contributions to other initiatives that differentiate disruptive leaders, though perhaps less direct, carry as much importance. These elements of the disruption playbook — which call for more attention to speed, structure and tone — require CFOs to work closely with CEOs and other executive team members to ensure their organizations keep pace with or stay ahead of the innovation curve. Beyond the table stakes of an innovation strategy, sufficient funding, developing talent, a KPI dashboard for the boardroom and the C-suite, and a supportive ecosystem, they include the following actions:
- Set the tone for disruption. CFOs who cut their teeth at the height of the Sarbanes-Oxley compliance era recognize that the attitudes and actions of executive leaders influence the workforce as much as documented policies and procedures. The same holds true in the “disrupt or be disrupted” era. It remains imperative for CFOs to act in ways that demonstrate a commitment to integrity, internal controls, transparency, accountability and corporate governance. Now, finance leaders also need to establish a tone at the top that emphasizes the importance of staying close to the customer, monitoring relevant market trends, supporting organizational speed and agility, and embracing necessary change.
- Provide better data sooner. When many large companies make high-impact decisions, they often take too long to reach them — and, often, too long to assess their outcomes. Relevant, accurate data drives high-velocity, high-quality decision-making. Finance functions play a crucial role in accessing and analyzing that data as more business units and organizational groups perform technology-enabled forecasting and financial planning and analysis (FP&A) activities. It is up to the CFO to ensure that FP&A processes are supported with appropriate controls, rigor and data relevance.
- Focus on the customer experience. Disruptive leaders obsess over creating value for existing customers and expanding into new markets. The fleeting nature of today’s customer preferences and loyalty, together with a more frequent inclination to gravitate to something better, faster and lower-cost-for-value, require greater attention paid to the value proposition offered to the market. CFOs should work closely with their C-suite colleagues to place the end-to-end customer experience at the heart of decision-making throughout the enterprise.
- Embrace an “AI in everything” mindset. Each C-suite member should own specific AI initiatives and outcomes — “real AI” (versus “labeling AI”) use cases with accountability for real returns. CFOs who prioritize staying ahead of the innovation curve assess agentic and generative AI use cases by identifying how these solutions drive positive, long-term customer relationships and reimagine core business processes. Organizations that fail to replace data entry, medial administrative work and other manual tasks with AI tools will lose ground to AI-enabled competitors.
- Establish an organizational structure that supports disruptive innovation. Disruptive leaders are five times less likely than disruption laggards (companies that are at risk of being disrupted) to view “the lack of an innovative culture or talent to think creatively” as a major barrier to becoming more disruptive. CFOs should collaborate with CEOs and the rest of the C-suite to encourage an open, flexible and agile organizational structure with a hierarchy that is as flat as possible. This type of workforce model drives execution by placing a premium on efficiencies, accelerating innovation cycles, and facilitating collaborations, communications and rapid decision-making. Many CFOs have set the example by embracing culture-building in recent years. They support focused, dedicated teams by equipping them with a sense of purpose along with clear priorities, well-defined tasks, assistance from strategically aligned ecosystem partners, and direction and support from executive sponsors.
- Learn at the speed of business. The faster an organization learns, the faster it evolves while responding to disruptive threats and opportunities sooner than competitors can react. An agile learning organization requires a culture that embraces open-mindedness, critical thinking, fresh ideas, contrarian points of view and a commitment to fail fast. Not coincidentally, these distinctly human competencies have more space and time to be exercised in AI-enabled organizations where larger portions of routine and repetitive tasks are automated. CFOs and CEOs who accelerate workforce learning favor transparent environments defined by knowledge-sharing, networking, collaboration, broad employee participation and engagement, and team learning. In these settings, errors can be admitted and leveraged for course corrections and improvements, and unconscious biases can be rooted out or minimized. Organizations that embrace fast learning also establish feedback loops with customers, suppliers, regulators and other stakeholders to identify new threats and opportunities quickly.
Although the definitive CFO playbook on managing through disruption has yet to be finalized, finance leaders should immediately begin formulating their own views as to what it entails. Clearly, “Cling to the status quo” won’t be among its tenets. The faster decisions are made as well as executed in these dynamic times, the sooner your company can progress toward disruptive leadership.
This article originally appeared on Forbes CFO Network.
