Until recently, CFOs could look at a company’s past performance and historic business conditions as a way to predict what the future could likely bring and make risk-management decisions based on that analysis.

But no more. Predicting the future using the past is quickly becoming an exercise in futility. The loss of linear predictability is creating increased uncertainty in the business landscape, according to a recent World Economic Forum white paper.

“In an exponential economy, risk has been supplanted by uncertainty which can neither be managed or measured,” according to the January 2022 issue of Deloitte CFO Insights.

This new environment can be especially challenging for finance professionals, traditionally tasked with overseeing risk management and financial planning. As the world becomes more uncertain, the role of finance professionals can change, and they, in turn, may need to develop whole new skill sets and priorities.

“Our contention is that, in the world of linear change, where you can use past data as a signal for what’s likely to come in the future and rely on projections and predictions based on good old-fashioned analysis, it was a fundamentally different job to be a CFO,” said Geoff Tuff, a principal at Deloitte Consulting and co-author of the January issue of Deloitte CFO Insights. “So finance professionals have to be ready to use different mechanisms…to help them make their decisions than they have historically.”

Ears to the ground. For finance professionals to more successfully navigate uncertainty, they may need to be attuned to weak signals of big change, Tuff said. CFOs will need to identify impending change and shifting trends before they are apparent by scanning the horizon, not the past.

“It requires better perception, better signal reading, better reaction to the signals to deal with uncertainty than what has historically been the case with risk,” he said.

To discover those weak signals, finance leaders may need to take a more forward-facing, people-centric mindset, said Chris Ortega, CEO of Fresh FP&A, an Indiana-based consulting firm that offers finance and fractional CFO services to businesses.

“CFOs need to be chief future officers,” said Ortega. “They don’t need to be financial officers anymore.”

Ortega recommended that finance professionals looking to increase their ability to read weak signals build trust within the business first, focus on people, and leverage technology in agile ways to become more “empathetic data-driven decision makers.”