The Cloud

Finance Innovation for the Future

A recent report from CFO Research suggests five actions to prepare finance professionals for the future.
David W. OwensApril 7, 2016

Tomorrow’s business world will look different from today’s. And it logically follows that tomorrow’s finance teams will look different as well. Professionals joining the world of finance can look forward to a career that is more deeply engaged with, and contributes more value to, the businesses they support.

Those were key themes emerging from a recent global survey of more than 1,500 finance professionals in large and midsize firms, conducted by CFO Research and sponsored by SAP. Titled “Thriving in the Digital Economy,” the survey sought to gain an understanding of what finance professionals from all levels see as the source of their future success.

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With information of all types, structured and unstructured, being generated from more sources than could have been imagined only a short while ago, companies’ success will depend increasingly on their ability to capture that data, analyze it, and make immediate decisions under rapidly changing conditions. Eighty-five percent of survey respondents agree that, over the next five years, their companies’ success will increasingly depend on their ability to adapt to the rapid pace of change and greater business complexity. For 84% of the respondents, success will also mean being able to translate the flow of data into swift and decisive action.

As a result, companies are increasingly looking to their finance functions to serve as information analyzers, not just data caretakers. To meet these expectations, finance teams of the future will also need to seek out the kinds of sophisticated information tools that can best support them in meeting the new demands they take on.

Five Ways Forward
Where exactly does an ambitious finance professional go from here in order to survive and thrive in a changed world? Survey respondents point out five ways to prepare for success.

16Apr_FieldNotes_p46a1. To become a leader, expand your view. Finance professionals are focused on what they need to learn in order to help the business run better, not just their own function. In preparing to take on broader leadership roles within their companies, they want to know the entire business better.

To gain this kind of understanding and advance in their careers, respondents say they are most likely to seek out general management experience (43%) and operations experience (36%). In keeping with the demand for more advanced analytical capabilities and information tools, nearly as many (34%) will seek more experience with information technology. (See Figure 1, above.)

2. Turn finance into a team of information analyzers, not data caretakers. Finance professionals at all levels express a clear vision of a more collaborative working environment, where increasingly sophisticated financial analysis is tied directly to swift, decisive business actions. That kind of interconnectivity is likely to grow beyond the virtual walls of a company, touching on external as well as internal partners within the company’s extended value chain.

Finance professionals of the future are poised to take on even larger roles in all aspects of value creation for their businesses. To do so, they see a clear need for more collaboration, greater self-sufficiency in their use of technology, and a more forward-looking analytical view. Ultimately, they see themselves transforming from data caretakers to true information analyzers.

3. Adapt technology to a new generation of finance professionals. Survey respondents say that their future success depends on new ways of working that are collaborative, flexible, and up-to-the-minute. To foster this kind of work culture, finance professionals believe their companies must bring their enterprise IT up to the standards that consumer IT — smartphones, tablets, apps — has established for speed, flexibility, and ease of use.

In fact, survey respondents believe that this transformation is required to meet the work needs of a new generation of finance professionals, which expects instant access from anywhere, anytime. Nearly three-quarters (73%) of the survey respondents believe that their companies will be pressured to bring enterprise information systems in line with consumer technologies in order to meet the future challenge of attracting and retaining top finance talent.

4. Transform expectations, and extend the use of advanced analytics throughout all functions. In the future, the finance function’s influence throughout the enterprise will be based less on its ability to keep track of the numbers and more on its ability to unpack what those numbers mean for the direction of the business. In fact, respondents say that becoming even more involved with strategy development and execution will be essential for the finance function — along with developing advanced information processing capabilities.

16Apr_FieldNotes_p47aAs finance’s reach becomes longer, there may be an opportunity to expand the use of advanced analytics into even more areas. Respondents say that advanced analytics currently are focused primarily on business analysis/decision support and forecasting, and less so in areas such as production/operations, pricing and sales, and risk management.

However, finance professionals see the potential for a “substantial, measurable financial benefit” from increased use of advanced analytics in virtually any part of a company. That includes back-office areas such as human capital management and IT management.

5. Strengthen your expertise — educate yourself about real-time analytical capabilities. In order to keep up with an increasingly fast-paced decision-making environment, finance professionals know that they will need to employ all the technology tools at their disposal. Advanced technologies will be the platform finance teams can use to vault forward. At the same time, only 6% of respondents report that their finance functions already have real-time analytics available, and fully half of the respondents don’t expect to be able to employ real-time analytics for at least two years. (See Figure 2, above.)

Respondents say that the largest barrier to adopting real-time capabilities is cost (35%), but the next largest number of finance professionals (23%) simply don’t think these capabilities are available right now.

In line with their expanding mandate, finance functions will need to be able to evaluate the multitude of technology providers in the market and the diverse range of capabilities they provide. The value of “digitalization,” enabled by widespread automation, will no longer be restricted simply to gathering data faster or storing larger volumes of it. Rather, advanced technologies offer the potential for actual transformation of the finance function, and by extension, of the business itself.

The future looks bright for a career in finance. By focusing on the five areas highlighted by this survey, finance professionals can become a “business partner of choice” in their enterprise (as one CFO participating in the research termed it) and fulfill a vision for their own bright future as well.