CFOs need to leave their comfort zone in order to optimise digitalisation
08/04/22
PwC survey: “The Digital CFO”
PwC’s global survey “The Digital CFO” shows that 73 percent of the CFOs surveyed consider digitalisation of the financial function to be extremely important. At the same time, however, digitalisation at most companies is still only at a very early stage. According to Alexander Staal, PwC’s finance transformation leader, CFOs need to leave their comfort zone to acquire new knowledge and new digital skills so as to enable their organisation to respond effectively to changes.
Budget for digitalisation is increasing...
The survey shows that big companies are much further along with digitalisation than smaller ones. IT companies are also relatively far advanced, but the financial function at utilities and construction companies is still lagging behind in terms of the level of investment and results in the field of digitalisation. There’s still plenty of work to do, because the survey shows that 44 per cent of CFOs expect budgets for digital projects to increase by up to 25 per cent.
…but employees’ knowledge and skills are lagging behind
The absence of the right knowledge and skills among employees appears to be one of the main reasons why companies are not yet sufficiently digitalised. Alexander Staal sees new fields of work emerging as a result of technological developments: “Technology is making things possible that couldn’t be done before. As a result, the way of doing business is changing more and faster than ever, which has an impact on internal business processes; organisations need to keep up with these technological developments.”
Digitalisation strengthens the strategic role of CFOs
Organisations often find searching for staff with the right expertise a difficult matter. New technological developments are making processes faster thanks to automation. Staal explains: “It shows once more that investing in digitalising the financial function helps. It takes work off people’s hands. AI-supported predictive modelling and future-oriented data analysis are examples. CFOs can thus strengthen their strategic role. But digitalisation also allows employees to spend their time on other things, which makes processes faster and more efficient. In addition, the boundaries between various operational fields such as marketing, sales, and HR will steadily disappear. Instead of thinking in terms of sub‑departments, organisations will need to increasingly think in terms of customer processes, as their base for decision-making and often also for offering improved products.”
“CFOs need to redefine the financial function”
CFOs of companies in the IT sector have their digitalisation in good order. For example, these organisations are already working with chatbots and planning tools, based on artificial intelligence. Bigger companies with a turnover of more than ten billion euros are also more likely to have their financial departments digitally in order. That’s because they can invest more easily in automating financial processes. They also often have staff with sufficient knowledge of IT.
On the other hand, the survey shows that utilities and construction companies seem to be doing little to digitalise their financial departments. According to Alexander Staal, future finance personnel will need to have a broader knowledge of technology and be up to date with the latest developments in that field. “Unlike when the traditional bookkeeper used to play the leading role in financial work, the financial function of the future will need many more people who can handle vast volumes of data, robotics, dashboards, and data analysis so as to deploy them in the best possible way for the good of the company.”
More digitalisation means organising things differently. “CFOs need to take a look in the mirror. Digitalisation must be given a more prominent place within the financial function. The advent of such things as data management and artificial intelligence is changing the work of finance department employees.” Staal concludes: “The ongoing developments in the field of digitalisation mean that CFOs must take a critical look at the current range of employees’ tasks and redefine it.”
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