CFO in times of Industry 4.0

If Industry 4.0 works out fine, depends more and more on the Chief Financial Officer (CFO). He or she can enable digital transition without excessive strain on the business. 

The new whitepaper CFO 4.0 from Siemens Financial Services (SFS) considers how the challenges of Industry 4.0 are giving rise to a new genre of CFO, with a deep, holistic understanding of the competitive advantages of digital transformation, and the essential capability to drive and enable that transformation.

 

According to research by Siemens Financial Services, five key competencies are required of CFO 4.0:

 

  1. A comprehensive understanding of the available financing options that can enable a commercially sustainable transition to Industry 4.0
  2. The ability to introduce relevant financing options early in strategic Industry 4.0 steps, in order to access and take advantage of the range of potential solutions
  3. Specific Industry 4.0 knowledge and expertise – related to financial, technology, operations and market analyses – in order to accurately assess digitalization opportunity vs digitalization risk
  4. The capability to build predictive Industry 4.0 return-on-investment models and performance monitoring processes
  5. The proficiency to create an effective phased plan to operationalise the business’s move to Industry 4.0.

 

Among the techniques to finance Industry 4.0 are transition finance, technology upgrade, working capital finance and pay-to-use and cover a wide breadth of requirements from the acquisition of a single digitalized piece of equipment, right through to financing a whole new factory, or even acquiring a competitor. 

 

The potential return on investment from Industry 4.0 investments can be reliably predicted. According to SFS research measurable improvements in manufacturing productivity are an important evidential starting point for the digital transformation business case, typically delivering returns of between 6.3 and 9.8% of annual turnover.

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