Despite 2020’s challenges, CFOs are optimistic about the future and ready to modernize their finance teams, new research shows. Most of the over 200 CFOs, senior finance executives, and CEOs surveyed by CFO Research in partnership with AppZen remain optimistic about the future, expecting growth in 2021. And their companies are adapting to meet the demands of a post-pandemic environment: Nearly eight out of 10 of the survey respondents accelerated digital transformation initiatives in 2020 due to the pandemic, including solutions powered by artificial intelligence. The research also offered insights into how and why CFOs are seizing their opportunity to lead digital adoptions, as well as key trends that are influencing finance technology adoption.
CFOs in Action
For digital transformations to be effective, the modern CFO must play an increasingly important role in the decision-making and implementation of digital solutions. This evolution of the CFO’s role was reflected in several areas of the survey research. For example, CFOs are now taking the lead over CEOs and chief information officers on digital transformation projects — by proposing and identifying solutions — as well as evaluating, selecting, implementing, and monitoring-after-implementing. And CFOs have been more frequently relied on to deliver real-time, accurate, granular data to their CEOs and board members in the wake of Covid-19.
CFOs have also had to build out modern finance teams to support their digital efforts. They increasingly need tech-savvy finance teams capable of employing analytics, and they’ve made improving analytical skills a top priority for their finance teams, the survey showed. CFOs are also placing more of an emphasis on recruiting new finance talent with more technological/digital skills or data management/analytical skills rather than talent with finance/accounting skills.
A New Finance Tech Stack
As CFOs ramp up their adoption of finance solutions that offer tools that can be adapted by end users – as opposed to needing IT to create reports or configure workflows – they reduce the need for IT to become involved in finance departments. The survey points to more finance solutions being adopted in the future by a broad swath of companies, with 90% of the respondents saying that reducing manual, time-consuming processes is a priority. Most of the executives also said that improving efficiency, reducing manual tasks, and reducing time spent on manual tasks were top priorities for finance — allowing them to support business continuity and resilience at their organizations.
Why the emphasis on reducing manual tasks? The answer may come from two areas of weakness that the survey unveiled regarding financial automation: AI-based invoice processing and expense auditing. Only 41% of the respondents currently automate ingestion and extraction of data from invoices, while 44% of organizations still take seven or more days on average to process an invoice.
The surveyed executives expressed regret about not investing more in technology five years ago, primarily with advanced analytics, but also with robotic process automation, AI, and blockchain. While lamenting their missed opportunities, most of the executives are now committing to technology investments for finance, especially in AP automation.
Reaping the Benefits
One of the most interesting findings from the research was the reasoning behind the executives’ positive outlook. Of the optimists in the survey—the executives who expect growth in 2021–most are the early adopters of AP automation and AI. And they now can focus their attention on better leveraging those technologies, investing in AP intelligence and advanced analytics.
As the technology early adopters reap the benefits from their investments in digital transformation–such as optimized free cash flow, decision-making agility, and reduced costs — the gap will widen between them and companies that are late to adopt. This, in time, will deliver huge competitive advantages to those organizations lucky enough, or strategic enough, to have a tech-savvy CFO and modern finance team on board.
Download the full CFO survey report