Finance Leaders Giving Back and supporting NFPs

CFO Magazine ANZ Editor, Richard McBride had the opportunity to discuss how Finance Leaders can give back and support NFPs with Ferdinand Kuncoro. Currently Ferdinand is Senior Finance Leader with FMC ANZ but aside from his nine to five, he is also passionate about his involvement with the Digital Gap Initiative, an NFP organisation dedicated to bringing about legal and other systemic reforms to create an inclusive digital society for persons with disabilities.

RM: Can you share some insights into your role as Director (Treasury and Finance) with Digital Gap Initiative? What are your key responsibilities and how do you look to add the most value?

FK: When I first had a meeting with Gisele Mesnage, the Founder of Digital Gap Initiative (DGI), we discussed in length the vision, the challenges, and the growth strategy for the organisation. One of the most important tasks for the role is guiding the organisation from the start-up stage to the growth and expansion stage. I have great admiration for the achievements to date including the adoption of the DGI Guiding Principles on Accessibility by the Australian Banking Association (ABA) after a policy discussion with Anna Bligh, the CEO of ABA, the acknowledgment from Australia’s Payment System Board within the Reserve Bank of Australia by passing a resolution on accessibility that DGI was advocating, and participation in the Australian Payment Council’s Strategic Agenda for its focus area on Financial Inclusion and Accessibility.

The key building blocks to bring the organisation to the next stage, hence my key responsibilities have a lot to do with budgeting and financial performance, capital management and funding, risk management and compliance, and strategic oversight and planning.

I have been in the corporate and consulting world for fifteen years, and naturally, the way to add value to the organisation straightaway will be in the form of getting the organisation’s finance in order and increasing the financial literacy of the other Directors and Leadership team – they are considered the low hanging fruits. One step further will be chairing the finance committee and getting the right strategy to obtain funding, they can come from the government sources, services we provide, and from donations.

The most challenging yet extremely exciting for me is learning from the other Directors especially from the Founder about accessibility and digital inclusion; in the next year or two, I can contribute to the policy discussion with government agencies and financial institutions. Finally, it is also especially important help DGI in enhancing their public profile and raising awareness in social media and other potential avenues.

RM: How can CFOs / Finance teams support an innovation culture?

Most modern organisations nowadays understand the importance of having CFOs and finance leaders as the key pivotal stakeholders in the development of enterprise innovation and growth strategies-this was not the case 10 to 20 years ago. One of the key reasons is capital scarcity–there are more projects that people would like to pursue than there is capital to fund them. Hence, CFOs and finance leaders’ analysis and opinions are highly sought after.

CFOs and Finance Leaders can support an innovation culture by establishing the “tone at the top” around innovation culture. As Elon Musk said in an interview, “leaders need to see failure as an option – if things are not failing, you are innovating enough.” In another word, they need to tolerate failure as long there is a genuine effort put into it and never forget to celebrate success.

CFOs also need to lead by example and take opportunities to innovate within the finance function, the key trends include ERP system, Robotic Process Automation (RPA), and Advanced Analytics.

RM: You studied Computer Science prior to Accounting & Finance – How important is it for contemporary finance leaders to be ‘tech literate’?

CFOs and finance leaders are facing increased pressure as finance and accounting transform from a back-office function to a business partner that helps drive strategy and deliver results. They are expected to bring innovation to finance, gather real-time information, forecast financial performance, and enable companies to make strategic decisions. They cannot perform these responsibilities with outdated technology and without having good knowledge of technology. Yes, they can build an army of tech-savvy finance professionals, but without being tech-savvy themselves, it is difficult to influence the other C-Suite members to adopt their solutions.

This question is bringing me back to 10 years ago: I was a new manager in finance, I had accumulated over 6 years of SAP implementation experience and 3 SAP implementation projects including SAP project management. I was asked by the CEO to manage an SAP greenfield implementation project in a complex manufacturing environment with a broken legacy system.

I said yes to the Project Manager role, SAP Financials Consultant role, whilst still working my regular job. Two weeks later, we hired half-a-dozen external SAP consultants which I pre-screened like Avengers and combined with 2 dedicated internal employees and with the support of the GM and sponsored by the CEO, we started our SAP journey – we forecasted $250,000 saving compared to fully outsourcing all the implementation tasks to the external SAP channel partner.

We mapped 5-step manufacturing process, 2000+ materials, complex pricing structure, various rebates scheme, multiple warehouses in SAP. We also trained 5% SAP-ready workforce to be able to perform the same tasks in SAP post-go live. Halfway in the project, the broken legacy system was playing up. We had to fast-track the project by 2 months to minimise the risk of not having a functional ERP system. We succeeded. We met the budget, we completed 2 months earlier, and we did a minimum rework post go-live.

Today, being a tech-literate finance professional gives you an edge and better opportunities; in 10 to 20 years from now, it may become a matter of survivability.

RM: Looking at the changing role of the CFO in what areas do you see the most amount of change in the next decade and how should finance leaders look to ‘futureproof’ their role?

FK: This new decade got off to a bad start!

The next 10 years will be one of the most challenging decades in history. In The US, the official unemployment rate is now 14.7%, the worst since records began; the real figure is higher and expect unemployment to rise to well above 20%. In Australia, we are experiencing the first recession in 30 years. In Asia, China has risen; the Thucydides Trap as coined by Graham Allison may as well become a reality i.e. the idea is that when a rising power threatens to displace a ruling power, the outcome is frequently war. Hence, I see the biggest challenge in the next 10 years will be associated with risk and uncertainty and risk management will be one of the most critical roles of a CFO as the business will seek risk management capability from finance in the future.

CFOs must use data and analytics to look ahead and identify the headline risks to the business, prepare a risk mitigation plan and develop a crisis management plan. CFOs also need to address risk directly in strategic and business planning discussions, routinely evaluate the risk profile and how they align with the corporate risk appetite, and help the leadership team to formulate the risk management strategy by floating important questions on key issues such as: resilience, technology changes, competition, market disruption, future regulatory environment, compliance risks, supply chain disruption, extended low growth period post COVID-19, climate change and many more.

Finance leaders can future-proof their role by building their skills in the areas of governance, risk, and compliance; this can be achieved through:

• Gaining business acumen through a partnership with commercial and operations team,
• Devoting increased time to understand risks and risk management strategy,
• Meeting and having a discussion around global risk with industry leaders,
• Building knowledge and gaining experience around managing compliance risks,
• Skilling up in the areas of data, analytics, and emerging technologies.