Given the prevailing macroeconomic unease, and the need to make sense of the rapidly evolving regulatory and technology landscapes, these are not simple times for chief financial officers.
"The whole role of the CFO is changing—it’s becoming more and more complicated," Peter Klein, CFO for Redmond, Wash.-based
In a wide-ranging discussion today at the firm's Chicago offices, Klein held forth on the shifting nature of the tools he, and his fellow CFOs in the insurance industry, can now leverage in efforts to bring costs down and get a clearer picture of operational risk.
Klein cited FinRisk360, a solution that incorporates market risk, credit risk and third-party rating information to afford user a holistic view of their exposures. "In the treasury area, this technology improves visibility into our risk," Klein said.
Rather than any single technology, Klein stressed that a broad approach, including technologies that help bring visibility to business processes, can also pay dividends.
"At Microsoft, we’ve seen improvements in workflow as processes are streamlined," he said. "We’ve cut our close time in half with this technology."
Not surprisingly, the discussion soon shifted to one of the more urgent topics for insurance technologists and CFOs alike: cloud computing. While IT departments and risk and compliance officers may harbor legitimate concerns about the technology, the promise of cloud computing to turn fixed costs into variable ones is an enticing one for CFOs. "You can dial capabilities up or down," Klein said. "This allows them (CFOs) to spend more time on their core processes."
What's more, Klein dismissed the notion that IT departments have anything to fear from the advent of cloud computing. "It will empower IT, which is focused on innovation anyway. This is just the latest innovation. They may need to figure out how to evolve to that, but IT will simply move up the value chain."
Klein says thanks to collaborative technologies, other, more seemingly mundane cost savings, can travel to the bottom line. "We at Microsoft have saved quite a bit using audio/video conferencing," he said. "We’ve saved on travel costs, which have dropped."
