The following question gives continuous sleepless nights to founders and CXOs quite often.
Where is my next 10x top-line growth going to come from?
And every time they conclude the following strategies, attempting to reap growth. They include:
- Sales channel expansion through increased sales targets
- Aggressive new-market exploration
- Enhanced marketing spending
However, these approaches create some pertinent challenges for the CEOs, including:
- Instinct, not insight-driven growth. Instinct-driven sales forecasts and sales efforts lead to companies doing the same. This deprives the organization of an opportunity to innovate using a data-driven, customer-centric approach.
- Risk of structural collapse. The rapidly expanding operations make organizational structures and processes exponentially susceptible to caving in, creating a downward spiral. The activities outpace the system capacities creating chaos and confusion.
- Promises not kept. Due to the mismatch between the leadership aspirations and operational capabilities, organizations have to backtrack on their commitments to investors and stakeholders. An inability to honor the commitments destroys brands and puts the organization on the perdition road.
These challenges are faced by established organizations and young startups alike. Even reputable global brands are not immune to value and brand destruction in the wake of mindless growth.
Can these challenges be mitigated?
Yes, but there's a caveat. The differentiating factor between a successful and an unsuccessful organization is as simple as asking – Where do the CXOs of these organizations put their horse?
Successful companies prioritize systems and processes, making their organization resilient to changes and equipped for growth, thereby putting the proverbial horse before the cart. They ensure the muscle to pull the weight is created before the cart is loaded.
💡Horse before the cart is a mindset which begins by accepting these challenges are natural in an organization’s growth journey and need to be not just weathered but conquered.
Which department is best suited for this job?
Balancing hyper-growth with capability building can be a task tough to master. Across small and large organizations, we hear buzzwords like finance-driven transformation and data-centric management. When implemented on the ground, these words are revolutionary in their nature and intentional in their design.
The trick, then, is to find the correct department with a mix of high strategic impact and transformative mindset and the right skills to consume and master data and drive ownership and accountability for actions. It is interesting to observe how across industries, finance departments are driving these initiatives.
No longer are they nerdy bookkeepers and number jugglers. CFOs and controllers have gone much ahead of the traditional accounting and reporting functions. They are today sitting on the saddle, holding the reins, and riding the horse at a fast pace.
Based on Deloitte’s CFO Signals survey, 47% of 172 CFOs from large North American companies, most with more than $1 billion in revenue, said they were either responsible for direct strategic planning (35%) or through someone who reports to them (12%).
Why finance is apt for growth enablement roles?
#1 Data mavericks
The finance departments have historically been close to organizational data, both financial and operational. This puts the finance wizards in an advantageous position – one where they can comfortably use data across business areas and generate meaningful insights.
Finance can easily take on the additional responsibility of an insight provider in addition to the traditional reporting tasks. Finance function, thus, is fundamental to an insight over instinct approach to decision making.
#2 Insight builders
Finance functions are increasingly being looked at for insight-driven management – from creating and reporting business KPIs to providing insights on improvement opportunities. They sit on a pile of data with the skills necessary to drill it. The good news is that CFOs across the board have recognized this trend.
Based on an online poll conducted by Deloitte within the global finance community, in around one-third of organizations, finance departments are already spending 30% of their time delivering business insights, and more than 83% of all organizations want to do more.
#3 Strategic business partners
Organizations looking to grow ought to utilize the business partnering capabilities of finance. This creates a two-in-a-box approach to sales growth. Today, finance is not alone forecasting or doing cost analysis. They’re looking at how to commercialize data assets.
#4 Trusted advisors
Sustainable hyper-growth demands intervention at all levels of the organizational hierarchy. And finance functions are in a perfect position to catalyze all levels of an organization because they:
- Grasp the ground reality through operational proximity
- Understand organizational strategy at the boardroom level
This data-driven mindset trickles down to all tiers, making organizations supercharged for growth.
#5 Automation flagships
Finance departments are perfect candidates to drive results using automation. They act as automation testbeds in organizations, simplifying, standardizing and automating operations.
This proof-of-concept approach not only helps in instilling the transformation and efficiency of DNA, but also brings about robust processes that can be replicated and scaled.
A process, not a people-driven approach to business, will set the future winners apart from the rest of the pack. Your success ll be determined by how well your organization turns scattered data points into a web of interconnected insights.
By using finance as the hub of this data wheel, organizations can improve efficiencies, drive sales and enhance stakeholder value. Reimagining tomorrow's business would require:
- Extraordinary leadership
- An out-of-the-box approach from the board
- Applying the first principle (putting the horse first, always)
Want to spin your finance team into a growth driver? Champion the move by talking to us. Book a personalized demo to learn more.