September 2019 |

Last Thursday, I chaired a conference of 250 of the UK’s leading CFOs for the World Finance Forum 2019. While there, five key themes on the state of finance, and the associated implications, emerged and were explored by the CFOs:

Robotic software and automation is coming down the line and will impact the shape of the function, but…

Some people are beginning to experiment with using it to improve certain elements, such as month-end report production, and it is an area of interest.  However, when I asked one of the speakers if they were ready to fire 75% of the team (a potential impact of automation), this elicited surprise from both the speaker and the audience.  This left me pondering how far many finance professionals, and I write this as an accountant myself, have their heads around the implications of automation.

There is the recognition that the function needs to recruit very different people to be business partners going forward, but

There was quite broad consensus that people who can perform more value-adding activities will be needed. Additionally, there are common characteristics, such as curiosity and appetite for innovation. This was one of the most exciting elements of the conference as it is a key element to finance’s continuing journey towards being a value-adding function.  However, there was little consensus as to:

  1. Where these new people would come from
  2. How to change the recruitment process to find them
  3. How finance can appeal to candidates when other departments would want the same characteristics.

PS. Interestingly, there was a view amongst a number of CFOs that the need for numeracy would decline.

The ERP platforms might just be about to match their 30 year old promise to bring visibility to historic data, however….

Many large corporates are still running multiple ERP platforms and / or using intermediate tools to bring visibility to the data within the ERP. And they are struggling. However, I certainly felt that the mood was changing towards the possibility that better automation might open up the point where the data was good enough to not only give good insights into historic activity but would also start to enable better budgeting and planning. We are not there yet but it is improving. The promise might meet reality after all!!

(As a detour, I had several conversations with experienced CFOs who were open about the ‘optimism verging on naivety’ of many business cases which had underpinned ERP implementations. The reflected that the poor implementation of many ERP platforms was a reputational impairment on finance over the last decade and a half. Probably a whole conference in its own right)

However, too many functions are not on top of their data…

I did not think I would be writing this in 2019. But, there is a continued problem with data integrity and accuracy. Too many speakers referred to the idea of ‘rubbish in, rubbish out’ which was met with affirming nods. Whatever the genesis, that this remains a problem holding back a material proportion of functions suggests that there is a fundamental problem impacting ability to do the day job. And I wonder, what is the reputational impact (again)?  If credibility is impaired, some finance functions are held back from achieving their more sophisticated aspirations for adding value.

‘Transformation’ is in vogue, but…why is it needed so frequently and where does it end?

Transformation is definitely the word of the moment.  I think it is a powerful mantra upon which to hang change programmes. However, two questions were left unanswered. 

First, why do so many functions need ‘transforming’? It remains unclear why the inherited transformation programmes were not good enough. I wonder whether in reality, that permanent transformation will be the order of the day?

In essence, the discussions were a combination of forward-looking and revolutionary, mixed with some deep dark secrets as to the state of data and ERP. Inevitably this might reflect the conference and the attendees, but it suggests that there is a substantial bifurcation occurring. There are those who have their house in order. They are beginning to leap forward with automation and can grapple with sophisticated business partnering as a corollary.  Alternatively, a significant group has yet to get the basics right and are in danger of being left behind.

Resources

Related articles