Business leaders are looking for effective growth strategies as their confidence in the prospects for the world economy rises. The challenge for CFOs is to help organizations identify and focus on the most promising possibilities, said Carol Sawdye, the global COO for PwC.
Speaking at the CFO Summit at Oracle’s Modern Finance Experience conference in Boston last week, Sawdye noted PwC’s 20th CEO Survey, which indicates that CEOs around the world are increasingly confident in the world’s economy—and are focused on growth.
Turning C-suite confidence into profitable growth and a sustainable strategy hinges on identifying and getting alignment on the company’s differentiating capabilities, she said—and this is where the CFO and the finance function can make sure the company focuses on areas that will make a difference—“and starving the heck out of the ones that don’t.”
She also said new strategies will be affected to a great extent by global demographic trends and rapidly changing technology.
For example, there is a growing shortage of skilled workers in the west. “That means it’s getting more expensive and will hurt margins unless we do something about our operating models,” she said. Meanwhile, talent pools in China, India, and Malaysia are going in the opposite direction; the skilled labor force in those regions is growing, and education is improving. Those trends could affect strategies around staffing as well as potential markets.
At the same time, rapid technological change—terrifying to some—is enabling companies to automate, take advantage of rapidly evolving AI capabilities, and leverage cloud platforms to standardize processes and systems. Companies have the opportunity to get on a single, unified instance of a financial system or a human capital management system tying together disparate resources around the world. “If you’re not, your competitors are. This debate of if people are moving to the cloud—I think that’s over. It is when.”
GE is one of those companies for which the debate is over. The need to move to a modern system became apparent to GE’s CFO three years ago, said John Mageropoulos, GE’s vice president of cloud ERP—and that set the company on a path that is likely one of the biggest cloud implementations in the world.
Joining Sawdye on stage, Mageropoulos explained that what the company’s CFO wanted to see was a modern system that enabled employees to base their day on real-time information, rather than information sent to a data warehouse, manipulated, aggregated and turned into a big file with a big lag.
“Five years ago, we were on more than 500 systems for ERP and accounting,” Mageropoulos said. “We came down to just over 30 strategic ERP systems.”
GE started its digital transformation with small, shared service implementations that moved the company off of a range of legacy systems. Mageropoulos’ team then conducted pilots to establish a proof of concept, and is now developing a roadmap with a long-term goal of reaching beyond finance to supply chain and other areas of the business.
The changes GE has made in the span of one year would have taken them many years with their legacy systems, he said. “While there are certain operational questions while we’re learning how to live in this world, the cloud itself has not been a problem.”
Margaret Harrist is director of content strategy and implementation at Oracle.