Technology’s role in the CFO’s office, as well as within finance teams, is receiving renewed focus.
With new tools available to take over the front, middle, and back-office responsibilities, the CFO now must not only be a master of FP&A and treasury, but also must be aware of the fintech options. Finance chiefs must apply the right technology, pay the best price for it, and avoid dreaded shelfware.
Recent CFO data from the 2023 Outlook Survey revealed three quarters (75%) of CFOs plan to increase capital spend for their finance teams this year. Finance executives, despite wanting to cut costs, are still looking to increase technology spend and use.
Alongside that data point, recent research from Gartner predicts more than 40% of finance roles will be significantly reshaped due to fintech through 2025. Are CFOs ready for the significant changes that will need to be made to workflows, labor, and data in order to make these changes happen?
While traditional CPA experience has paid dividends for CFOs for decades, the automation of corporate accounting is causing many CFOs to fall behind in the digital realm, according to Shannon Cole, senior director analyst of research for Gartner Finance.
“Most finance leaders, including many CFOs, are ill-equipped to identify and address the rapidly evolving digital skills needed in finance,” said Cole. “Expertise in traditional finance topics, while valuable, does not prepare leaders to train staff to execute on capabilities such as deploying bots, machine learning, and AI algorithms.”
Many CFOs are ill-equipped to identify and address the rapidly evolving digital skills needed in finance. — Shannon Cole, Gartner
As Gartner predicts, CFOs need to upskill their knowledge about technology. However, CFO data shows financial leaders are aware of this shortfall through their hiring efforts.
CFO’s findings indicate that, although accounting skills are still paramount in candidate evaluation, technology acumen in candidates isn’t ignored. In fact, it is just as important to CFOs as data analysis skills and more important than if the employee fits into the company culture.
According to Cole, the onus still falls on the CFO to be more tech-savvy. “As more finance resources are directed towards digital transformation, there is a need for deep process expertise, and for project management offices to provide governance and coordinate these initiatives,” she said.
Gartner suggests that CEOs will look to the rest of the C-suite to determine who is best equipped to lead the tech adoption strategy.
“CFOs that effectively lead and navigate transformation will add roles to their leadership team to address analytics and decision support, finance IT, and global process ownership,” said Cole. “CEOs will give these responsibilities to whoever can lead the change best, and CFOs will have to compete with COOs, CIOs and CDAOs to retain these responsibilities.”
CFOs that effectively lead and navigate transformation will add roles to their leadership team to address analytics and decision support, finance IT, and global process ownership. — Shannon Cole, Gartner
CFO data suggests finance leaders are aware of this, and have already taken steps to incorporate new technology. When prompted to identify three workplace changes and policies anticipated in 2023, 34% chose technology adoption — the most frequently selected category.
These efforts towards technology integration are pivotal for CFOs trying to set themselves up for a workforce that works hand-in-hand with technology.
“[Our research] shows us that transformation of their function remains very high on the agenda,” Cole said. “By 2025, 80% of new headcount growth in finance will be in new sub-functions rather than traditional accounting and FP&A, requiring new roles and structures.”