As part of an ongoing CFO research study, HFS recently interviewed Carolina Romero, Global CFO of Private Banking and Wealth at HSBC and member of the HFS OneCouncil. In her current role, she is responsible for driving business performance with the CEO and GPB&W EXCO through robust management information to improve returns, optimize capital deployment, and ensure sustainable growth for the business. She is also an enthusiastic advocate for talent and skills development and employee well-being in the bank.
During our conversation about CFO priorities, she highlighted that an organization-wide approach is imperative in driving an end-to-end transformation. Let’s dive into Carolina’s take on what approaches an enterprise can adopt to bring about change.
To align with the wave of digitalization and achieve operational excellence, it is essential to take a step-by-step approach to bring processes together to achieve transformational goals. Carolina emphasizes that it is necessary for organizational functions to collaborate while bringing together data, technology, and the right talent to drive the right decision making; finance alone cannot achieve goals in this ambitious agenda. For the finance function, it is critical to be part of the key initiatives and lead the transformation. She relayed three imperatives for business transformation.
The right insights are vital
Finance deals with a lot of data by being in the middle of all the business functions. Data modernization thus often rises to the top of finance and accounting initiatives for future growth.
Carolina states, “Finance is the recipient of data from multiple functions and shares a lot of data and insights with the rest of the organization. So, we need to make sure we have better processes to quality control data and ensure that our analytical capabilities are faster and better, allowing us to have much better insight into trends, risks, and opportunities. In addition, going beyond and linking financial and non-financial data to get the right insights and understand the story behind the numbers will be essential to enhance value creation for the organization.”
Be part of the larger enterprise-wide initiatives
For finance, it is crucial to be part of the discussion with leadership and other enterprise functions in implementing functional operational architecture or process to understand its impact on finance and the value that finance can attribute. Harnessing synergy between finance, risk, and operations is essential to yield better insights and improve decision making. Harmonization of people and tech will be the key to driving this. Organizations need to pick up the pace with the changing business operating environment by integrating the right skills to bring synergy among the functions while meeting BAU targets.
Carolina highlights, “I feel finance will be more successful by being closer to the business. Business finance and commercial teams within finance will need to collaborate more with core finance functions like treasury, accounting, and tax. They should be fully embedded into the business while maintaining objectivity, fairness, and transparency. Further, finance should be embedded with sales and operations to adopt a holistic approach.”
Drive real-time decision making
In a constantly changing business environment, access to real-time insights is essential for the right decision making. It can be implemented through collaborative interactions with subject matter experts or other business functions, which is the way forward to drive organizational value.
Carolina shares, “Forecasting has always been at the core of what we do. But in a highly volatile operating environment, we are trying to make better sense of what-if and potential scenarios and direct and indirect impacts to help determine the right set of management actions and do it as fast as possible, given the fast pace of change in today’s world. Back-testing assumptions and tracking outcomes become even more important to enhance models and forecasting capabilities.”
Based on our recent interactions with finance leaders, HFS agrees that deeper integration within the enterprise functions is becoming critical for organizations to make the best use of their data to drive decision making. We see that finance functions are making gradual investments to develop digital capabilities or partnering with service providers to realize the potential of data in finance processes.
The best enterprise leaders are those who can provide clear strategic direction to overcome corporate bureaucracy and bring people together to drive effective decision making. That’s how you build business agility by letting people react to changes in their local markets and taking decisions that are needed at the time.
Carolina states, “I think in many cases, to become more nimble at decision making, clear empowerment is required. That means our teams need to know and fully understand the exam question and context so they can act quickly and effectively. Leveraging subject matter expertise across finance with the right visibility and guidance on the wider challenge and goal will lead to better-informed and faster decision-making. That level of empowerment and ensuring people’s goals are aligned is absolutely the key.”
Along with driving people in the right direction, empowering them with the right skills is essential, as the expected skillset for finance professionals is changing; digital and data proficiency and storytelling ability are becoming part of the future through upskilling and reskilling programs.
Carolina shares, “I am spending a lot more time on upskilling and reskilling people agenda. Working with them to understand and enable them to really come on board on this transformation journey. And how we change the future operating model and ensure that we have the right people in the right places with the right development opportunities. Skills are the new currency to enable agility and mobility and unleash the potential of our people. This ‘new world’ offers exciting opportunities to transform our work, but the road ahead will be bumpy, and establishing a strategy and framework to go through it together is key for success.”
Business transformation cannot take place in silos, and the business function, people, and consistency in data need to come together. At HFS, we see that to keep pace with the changing business and digital landscape, finance leaders are taking a step back and more closely evaluating the processes, methodologies, and people expertise in place to bring holistic changes in the operating model with the help of prescriptive insights to drive sustainable growth.
We are closely studying CFO priorities and the new Horizons of finance as the office of the CFO evolves to manage a myriad of responsibilities. We are building viewpoints from Carolina Romero and other CFOs across industries in collaboration with our study partner, professional services firm Genpact. Our upcoming market report will outline how forward-thinking CFOs like Carolina are changing the very nature of enterprise finance. Stay tuned!
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