According to a recent survey of 300 middle market chief financial officers (CFOs,) the 2018 CFO Outlook, the search for continuous positive business growth now requires CFOs to not only manage corporate financial reporting, but also develop and shape organizational strategies, identify new business opportunities, and expand the use of technology – in effect to play a role more similar to Chief Growth Officer.
CFOs have positive expectations for the economy in 2018 and their ability to achieve strategic growth targets. These beliefs have been further enhanced by recent changes to the U.S. tax code for businesses.
Half expect improvement and another 30% believe economic growth will remain the same. CFO optimism is significantly higher among upper middle market companies compared to lower middle market companies.
CFOs will also look to emerging technology trends to support their pursuit of business growth, which is why CFOs report that greater technology awareness and adoption is viewed as the most important new skill they must acquire. With these new skills, CFOs expect to increase their use of electronic and real-time payments, as well as invest in the technologies and people that are needed to unlock value from all of their data driven insight.
In the near term, CFOs are looking to increase their utilization of electronic payment technologies to drive greater business efficiencies, reduce costs and improve working capital. On average, CFOs seek an increase of 17 percent in payables and 15 percent in account receivables executed electronically. CFOs realize that electronic payment technologies make good business sense: four out of five acknowledged the positive impact they are having on overall company performance.
Although some positive impact has already been felt, most CFOs believe they are not currently using big data to its potential. Both upper and lower middle market CFOs believe the future impact of big data will be significant and both are planning to invest more to ensure business success. Almost all upper middle market CFOs anticipate spending more on people and technology to drive an increased impact while about two-thirds of lower middle market CFOs plan to increase their investments.
Almost two-thirds of both upper and lower middle market CFOs are focused on the tasks that are necessary to keep their company properly financed, and more than half are focused on cash flow management to help optimize working capital.
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