As the global economy continues to gain strength, corporate CFOs are expressing rising optimism in their outlooks for profits and the general economy.
This renewed confidence among CFOs is spurring a growing number of finance chiefs to increase their risk appetites for spending on new hires and capital investments, according to a study by AICPA. CFOs who are feeling upbeat about the economy and the financial prospects for their organizations are more likely to invest in corporate initiatives that offer the potential for delivering strong returns.
Analytics can enable CFOs to compare and contrast the operational and financial risks and rewards for pumping capital into different areas such as recruiting and hiring personnel with specific skills, IT/business projects, and capital equipment.
For instance, a CFO for a discrete manufacturer can use data and analytics to better understand the potential risks (downtime, loss of business) and benefits (reduced infrastructure costs, time-to-market for adding new functionality) when deciding whether to move a project management/time management system to the cloud.
The same CFO could also gauge the operational and financial returns of this project relative to other IT/business investments being considered, such as the anticipated productivity and business performance gains expected from deploying a mobile sales automation system for the sales team.
Since the financial crisis of 2008, many companies have been hesitant to add personnel for fear of inflating costs as revenues remained stagnant. As the economy gains momentum, business expansion is forcing a growing number of CFOs to pull the trigger on hiring.
CFOs can work with HR to determine the skills needed by the organization and use analytics to prioritize which positions it should fill first based on the productivity that’s anticipated from new hires, the costs to hire new employees, as well as other financial and operational returns new hires are expected to generate.