Capital Markets

Still Processing

CFOs still spend too much time on transactions and too little on analysis. When will this change?
Cesar BacaniFebruary 22, 2008

At virtually every conference CFO Asia convenes, participants share a
similar complaint: The board and the CEO are badgering the CFO for better
analyses and forecasts, but finance just can’t shake the burden of
transactional work.

A new survey by the non-profit research firm APQC plumbs the depth of the
problem. On average, the 54 CFOs surveyed in Asia said their
departments spend 50 percent of their time on
transaction processing. The rest of the work day is
spent on decision support (16 percent), control (19
percent), and management activities (15 percent).

If it’s any comfort, CFOs in the United
States are in the same boat. The 89 respondents
polled there said their company’s finance function
devotes 46 percent of its time to transaction processing,
and 18 percent each on decision support,
control, and management activities.

Both groups, however, hope to change
things. “Respondents see the need to achieve a
greater balance between the four main categories
in order to allow the organization to better plan,
lead, and react to changes in the marketplace,”
APQC researchers wrote in a report for CFO Asia
and IBM Global Business Services, which sponsored
the study.

By 2010, CFOs in Asia aim to reduce time
spent on transaction processing to 38 percent (U.S.
respondents: 35 percent), while increasing the time
devoted to decision support and other activities to
62 percent (U.S. respondents: 65 percent).

How? In part by relying more on shared services.
Six out of ten finance departments in Asia have
already turned over to a shared services center the
processing of receivables and payables, general
accounting and reporting, and treasury functions.

Technology is another potential tool,
although Asia’s CFOs have a long way to go in this
area. About 64 percent still do planning, budgeting,
and forecasting by typing data into spreadsheets,
with 40 percent doing the same to manage
cash, and 25 percent to manage fixed assets.

Time Asia CFOs spend on functions vs. time they want to spend; % firms using process for said functions