How the CFO is shaping the state of business digitization in 2020
- CFOs are in the spotlight today as businesses weather an uncertain market
- They will have greater say than ever before on tech budgets and priorities
- Cybersecurity tops the list, as CFOs drive the shape of digitization in 2020
The Chief Financial Officer (CFO) is feeling the weight of responsibility right now. With budgets tightening and profits slowing in the face of an impending recession, they are probably the most important people in any business.
According to the Institute of Management Accountants president and CEO Jeff Thomson, the current crisis is shining a light on the expansive role this executive plays.
“The CFO is not only the one who helps ensure the organization has a strong balance sheet and cash position to ride through tragedies, pandemics, or disasters like this, but the CFO really has their pulse on the entire enterprise operation.”
As such, much of the state of business technology and wider digitization in 2020 will be largely orchestrated by the hand of the CFO.
In a survey of 313 US finance leaders during a critical week when unemployment claims peaked and small businesses were rapidly turning to emergency loans, PwC’s COVID-19 CFO Pulse report gave some insight into the job on their hands right now.
It found that more than two-thirds (67 percent) of US leaders intend to defer or cancel planned investments. But it also revealed how the current situation will affect how businesses will prioritize spend on technology.
Among the areas considered, investment in digital transformation, customer experience and cybersecurity were the aspects expected to receive the least cuts.
The survey revealed just 25 percent of CFOs are considering minimizing funding for digital transformation plans, while 15 percent are looking to reduce spend on customer experience related functions, suggesting these areas are considered key for businesses’ near-term and long-term survival, and therefore must be sustained.
For instance, IDC predicted that worldwide spending on digital transformation would peak up to US$1.2 trillion by 2023, taking up the lion’s share of spending in ICT (information and communication technology).
Meanwhile, as 82 percent plan to stymie investments in facilities and general capital expenditures, when it comes to cybersecurity, in contrast, just 2 percent of finance leaders want to cut spending.
Cybersecurity has rapidly risen up the ranks of the priority list in recent years; but the pandemic has exacerbated vulnerabilities. Businesses are ready to spend on protecting themselves, knowing that not doing so could lead to their downfall in the worst market conditions in decades, where recovery is unlikely.
Cybercriminals are leveraging COVID-19-related anxieties to run themed phishing attacks, as well as a surge to collaboration tools and work-from-home setups which will not be as adequately or reliably protected as the internal business network.
The rise in risk is such that the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency (DHS CISA) issued a public warning on the rise in phishing emails targeting unsuspecting teleworkers, urging businesses to adopt a “heightened state of cybersecurity.”
Solutions that contribute to more secure endpoint connections are therefore still enjoying spend. Virtual Private Network (VPN) vendors, for example, in March saw an increase of around 150 percent year-over-year in the United States.
“Working from home has accelerated the number of connection points in the network and the certificates and keys that ensure authentication and baseline protection,” Jordan Rackie, CEO at Keyfactor, told TechHQ.
“Having visibility to those connections is critical to managing them,” said Rackie; “the margin for error is slim and mismanagement can cause systems disruptions, outages and even security breaches.”
As we move further into a market decline, and businesses lack a pool of spend for new technology investments, the world of enterprise technology may look back on 2020 as the year when digitization across industries was driven more by the CFO than anyone else in the business.