The past year was full of surprises. From the pandemic that none of us saw coming to a US election without precedent to a seismic move from office-based to remote and home working – 2020 was a rollercoaster.
Also seeing rapid change has been finance departments. To explore how CFOs and their teams are adapting to the dynamic business environment, we, in partnership with CFO.com Research, surveyed over 200 finance professionals across the US and UK, asking them about their business priorities, their use of IT to adapt to change, and how COVID affected their departments.
The findings from our CFO Survey research exposed a series of insightful results. From optimistic CFOs to changing hiring requirements, we explore the five most surprising trends.
Most CFOs are very optimistic about the future
Despite the substantial financial challenges that organizations globally face in the current environment, 61% of the survey respondents are expecting growth in 2021. And it is the CFOs who are the most positive of the bunch — with 66% of them looking at a positive future. This positivity occurs across all business sectors except construction, where 70% expect flat or even negative growth in the coming year.
Technology plays a crucial role in that optimism, as those expecting to see growth are focused on proactive use of technology moving forward. This group’s priorities include the increased use of analytics (40%), better enabling their remote workforce, and optimizing working capital. Those who expect to struggle in 2021 are naturally more focused on cost savings than investment.
Support from the C-Suite is the biggest inhibitor to Digital Transformation
IT offered a lifeline to organizations needing to work remotely during 2020. A massive 86% of survey respondents said that they have accelerated their digital transformation projects this year — they have had no choice. You could expect that the C-Suite would be entirely behind this drive, but that is not the case. The biggest challenge posed by those implementing digital transformation projects was a lack of support from the C-Suite — a situation experienced by 1 in 5 organizations. This topped cost (18.8%) and training issues (14.4%) as the biggest roadblocks to change.
The lack of support from the C-suite is particularly worrying, given the large number who accelerated their transformation efforts in the past year. Of course, COVID played a huge role in forcing these through — BUT if these projects do not ultimately have the support of the C-suite, are they destined to fail?
Finance teams want technology and digital skills more than finance and accounting skills
It would seem logical that finance teams would want finance and accounting skills when recruiting — the reality is a little more complicated. The increasing use of technology in the finance function leads CFOs to value a different set of skills equally highly.
Recruitment requirements for finance are currently showing an equal number (28%) wanting technology and digital skills as wanting finance and accounting skills. In fact, in the Auto, Industrial, and Manufacturing industries, the balance tips further towards technology skills (38%) versus accounting skills (8%).
This trend comes as CFOs look to add digital and technology capabilities to their teams directly – giving them even more control over their systems and reducing the need for IT involvement. A hefty part of this focuses on analytics — 34% of respondents cite improving analytical skills as their key priority for the year – the most popular result.
Almost half of orgs still take 7+ days to process invoices
Despite considerable advances in automation within finance departments, increased use of AI, supplier networks, and eInvoicing, 43.5% of organizations still take seven or more days on average to process an invoice. Comparing this to best in class invoice processing times of 2.9 days per invoice highlight that finance teams still have some way to go.
Indirect invoices, paper invoices, and non-PO invoices cause the main problems, but these are not new issues — and are issues solvable with modern AI-based invoice processing solutions. However, these are patently not in widespread use yet as only 40.9% of respondents automate ingestion and extraction of data from invoices.
Accounts payable automation continues to be a mystical nirvana. Respondents understand the benefits, as 4 out of 5 orgs believe that adoption of AP automation would enable remote working and reduce errors in manual processes — yet turning understanding into reality continues to pose problems.
CFOs wish they had invested more in tech in the last five years
Our final surprising finding is the admission that 45% of respondents wish they had invested more in tech over the last five years. Often seen as slow to deploy new technologies, finance professionals’ recognition that more investment would have delivered greater value may bode well for future investment levels into IT projects. Specific areas that the finance team would have liked implemented by now include advanced analytics topping the list, with 67% wishing they’d paid it more attention.
Other areas on the hindsight wishlist included AI (42%), blockchain (41%), and RPA (43%)
Despite an inbuilt conservatism and resistance to change, CFOs and their finance teams are increasingly drawn in by the lure of technology. 2020 saw remote working pile pressure on IT systems to enable organizations to keep the lights on — but moving forward, strategically-astute CFOs will look at how technology can do more within the finance function.
Those who have mastered the basics of automating invoice processing and expense management are now moving onto advanced analytics, AI, and RPA to drive value and not merely process numbers. The organizations within this vision are pulling further and further ahead of those still taking ten days to process an invoice – perhaps the biggest surprise of all in this data is that the gulf between the finance technology haves and have-nots is not as wide or influential as it certainly will be in the coming 12-18 months.
To read the full report, click here.