Overcoming today’s challenges with strategic, collaborative innovation
There is something remarkable about the African continent, the scarcity and complexity brings light to innovation and invention. Within the challenges of infrastructure resides the potential of technology and organisational agility. As the pandemic continues to influence how organisations operate and behave, African businesses need to adapt its workforce and technology considerations to fit the needs of the continent and the customer.
The recent weeks and months have likely been the biggest challenge for all businesses across the continent. With almost no warning, millions of businesses – indiscriminate of size or stature – suddenly went from operating as usual to facing enormous challenges under the weight of uncertainty.
When global uncertainty is coupled with increased scrutiny from the CEO, board, investors, employees, and customers, every move they make is critical.
With these challenges to meet and tough decisions to make, the CFO is at the centre of a rapidly changing economy. There are four areas where a CFO-led rethink and innovation will be crucial: managing cash flow, investing in the supply chain, working closely with HR, and focusing on customers.
The most immediate challenge faced has been managing cash flow. Many businesses, whilst inherently profitable, found themselves struggling to make ends meet with insufficient working capital readily to stay solvent. This lack of economic resilience does require short-term cuts, but it also relies on intelligent decisions that will keep the business healthy in the long-term.
The next focus area is supply chain. For decades ‘lean’ has been the name of the game. But lean, just-in-time supply chains have struggled in the face of global crisis. To get back on track and plan ahead, spending big to ensure supply chains are robust and resilient, not lean, will be critical.
Balancing cost-cutting while ensuring the business can still function effectively is vital, especially when your biggest asset – talent – is also your biggest expense. To walk this fine line and ensure every decision made helps safeguard business continuity and survival, the CFO should work closer than ever with HR. Together, they can master their business’ data to see where skills and resources are needed most in the here and now, while planning for whatever the future may bring.
A people-driven approach is vitally important, and not just when it comes to staff and employees, but also customers. Delivering good customer experience is one thing, but right now, CFOs and finance teams getting closer than ever to their customers – and indeed their suppliers – is what will set you apart.
Showing you can balance their needs with those of the business’ proves that you are the partner they can trust to guide them through uncertain times, now and in the future.
In building resiliency, organisations need to focus on building a resilient community amongst employees, customers, partners and suppliers. Having issues of cash flow front and centre forces the cost of talent into the limelight – but it doesn’t mean putting profit before people.
Relooking their relationship, this is where the CFO and HR team need to come together, working more closely than ever before. Together, the CFO and HR need to evaluate skills and resources, minimise temporary and long-term loss of staff, and look after their people. All of this will build a resilient business.
Focusing on bringing an overarching view of the health of the organisation is key; data is crucial to shape every discussion, aiding in quick decisions and allowing for agility and innovation. Building resilience is not finance’s job alone, this could be collaborating with the CIO and R&D teams, to ensure any future innovations align with customer strategies as well as the business’ purpose. Or it could mean working more closely with HR to ensure the business can meet changing customer demands.
Right now, cloud based applications such as Enterprise Resource Planning (ERP) and Human Capital Management (HCM) are immensely valuable as they help build business resilience and innovation in an extremely complicated market.
These solutions provide insights that can offer improved control over factors such as supply chain management, inventory and purchasing. They integrate systems and data, connecting systems and information so that data becomes transparent and accessible and relevant. These applications also help the organisation use business intelligence (BI) to analyse data, to create KPIs that are based on strategic targets, and measure performance versus targets to meet goals based on current market conditions.
With this strategic approach, companies are able to manage the complex balancing act more deftly between legacy and futureproof without whittling away at the bottom line. It has also stimulated greater interest in how digital applications can benefit the organisation.
These applications need to support the balancing act between the business and its potential, between the CFO, CHRO, CIO and all lines of business, and ensure that they deliver more value to the organisation.