Finance chiefs in 2023 have no shortage of resources at their disposal to help lead their organizations. Consultants, technology companies, other executives (and sources such as CFO), all jockey for a place at the table. And with AI-generative technology now dog-piling onto the long list, the emerging tech offered by chatbots, operating off billions of data points, bases its output on more information than any individual could ever hope for. This, combined with the shortage of quality labor, has influenced many groups to assess how generative AI can supplement underperforming labor markets.
However, even in the CFO role, where demand for interim CFOs has doubled and turnover is at a five-year high, implementation and practical application remains difficult (especially if ChatGPT can’t even pass an accounting course). A CFO’s full list of duties is still well beyond the capabilities any combination of technology that is readily available can offer.
Below are six elements of the CFO role that no technology can fully take over. The human element provided by the individual’s personality and work experience still separates the best from the rest.
While AI can provide valuable insights on data sets and process improvements, decision-making involves weighting factors that are much more than just data. These factors include organizational goals known to the executive team, decisions based on previous experience, gauging stakeholder interest, and knowing where the limits for risk are in an organization.
These multifaceted, intricate processes can be assisted with technology, but are ultimately dependent on the leadership style, skillset, and work experience of the executive calling the shots.
CFOs are responsible for making sure their organization’s allocations and financial goals are in alignment with the company’s ethics, morals, and values. Priorities such as offering employee benefits to promote wellness, hosting company-sponsored events and happy hours to promote camaraderie, and selecting charities or different ways the organization are all components of a company’s strategy towards their ethics and culture.
Unlike AI, the CFO role requires judgment calls to be made based on an understanding of the organization’s culture, stakeholders, and regulatory requirements. Although AI can assist in identifying potential ethical risks and violations, it cannot make ethical or moral decisions on behalf of the organization.
This is one of the most human-centric elements on this list. In any role, a person who has good ideas is able to express them and is clear in how their ideas need to be built out are some of the most valuable people on any team. Leadership, especially CFOs, must continuously innovate, finding different ways to create value for the organization. While AI can help generate insights and ideas, it cannot replace the creative thinking and problem-solving skills required for innovation at all levels.
The best CFOs — whether it be with employees, investors, their employees, or the CEO — are great communicators. Translating financial information in ways that are easily understandable to different stakeholders is a key characteristic.
While AI can help automate some of these tasks, it cannot replace the interpersonal communication skills and emotional wherewithal required for top-tier leadership and communications. Building and maintaining strong relationships requires human skills such as empathy, trust, and the ability to collaborate and exchange ideas; something that cannot be fully done by AI.
While AI and other types of fintech can help automate compliance tasks, they cannot replace the human expertise and judgment required to assess and be up to date on the latest compliance standards.
Any CFO who is willing to put their organization’s compliance adherence solely in the hands of technology may be putting themselves in a difficult spot. Should there be any type of error, few CFOs will be able to skate by a serious regulatory issue or error via passing blame on ChatGPT or similar technology.
While generative AI can help identify risk, it cannot yet replace the experience and expertise that CFOs possess to evaluate mitigation solutions. AI tools enable an organization to collect and analyze historical data, but assessing future risk still requires the CFO’s input to define the necessary parameters.
Additionally, AI such as ChatGPT is going to be limited in how often the data sets are updated, and so current economic and global events may not yet be reflected in its analysis. Finance chiefs still have the advantage in assessing real-time events and pivoting their organizations quickly.