To understand where European companies stand in the digital transformation of the CFO function, BearingPoint conducted a CFO 4.0 survey directed at CFOs and finance managers around Europe. Finland was one of the six countries where the survey was conducted, alongside Austria, France, Germany, Ireland, and Switzerland. The study sheds light on the technology CFO functions are using and the actions they are taking and plan to take to get the most out of digitalization.
To illustrate the digital maturity level of the CFO function in a company, the study considers digitalization as an accelerator of change that impacts business in three waves.
Improving the day-to-day work through process streamlining and automation
Providing financial insights for the business using real-time data and self-service visualization tools
Reinventing value chains and offering, supporting and driving the transformation
The analysis was done at the country and industry level and from a digital foundation point of view. The digital foundation consists of strategy, organization, people, technology, and data perspectives, all equally essential elements in the digital transformation of the finance function. Responses were reviewed from telecommunications, technology, financial services, the public sector, manufacturing, retail, energy, chemical, and oil and gas industries.
According to the study, CFO functions around Europe understand the strategic impact of digitalization, but the current levels of digital maturity remain underdeveloped in all the countries surveyed. Only 9% of the companies surveyed have positioned themselves to the wave of business transformation, whereas 41% still focus on operational efficiency improvements of the first wave of digitalization. The average digital maturity level of European companies is 4.9 out of 10, which suggests that companies are still halfway from the ideal CFO function. Ideally, the CFO function should be flexible, service-oriented, and focused on supporting and working closely with other business functions.
Digitalization initiatives are even more important when business conditions change. The study shows that only 12% of finance professionals use their time on value-adding services, making it more challenging to adapt to uncertainty and new business requests. The ability to seize opportunities fast and simplify processes is crucial so that the CFO function can support the business and create new business models as efficiently as possible.
Country-specific results highlight that there are no major regional differences in the future vision or perceived CFO practices in pursuing digitalization. However, some countries surveyed have implemented a broad set of technologies, while others have a narrower focus or are looking to catch up. Also, some countries are more focused on operational efficiency improvements of the first wave of digitalization, while others have already started to move toward supporting thorough business transformation of the third wave of digitalization.
The research findings indicate that the biggest threats to successful digitalization are linked to culture, strategy, and people. Too many priorities and the lack of a clear strategy and vision are the most significant challenges preventing successful digital transformation within the CFO function. The majority of the study respondents believed that the performance of the CFO function could be improved if employees were willing to experiment, take risks, and work in distributed teams.
The industry-comparison shows that the digitalization of the CFO function has started to transform practices at some level in each of the industries included in the analysis. However, the special characteristics of each industry, such as regulations and lifecycles, affect the phase of digital transformation. The study finds that the telecommunications industry has the highest digital maturity level. Digitalization has been considered in their CFO strategy and companies in the industry are the most confident in the readiness and capabilities of employees and leadership to execute digital transformation. The overall digital maturity levels of the analyzed industries are presented in the infograph below.