Often considered the most traditional role in a company, the CFO function now faces changing requirements and expectations from external and internal stakeholders created by digitalization: there are new opportunities, different ways of working, and unique business challenges. Today’s CFO function must be able to drive digital transformation and actively contribute to the change of an organization. BearingPoint’s CFO 4.0 Study finds that CFO functions in Finnish companies are still halfway from the ideal in terms of digital maturity, but they are keen to invest more in digital development in the upcoming years.
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 characteristics of the CFO function, the technology they 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.
The field of digitalization is continually improving and developing in Finland. Progress, however, has been slower than perhaps desired. The challenges in linking new technologies, digital strategy, and business needs together is a common problem for many companies.
The study finds that the digital maturity level of the CFO function in Finnish organizations is 5.1 out of 10, slightly above the European-average (4.9). The focus from operational efficiency improvements toward strategic business partnering has accelerated since BearingPoint’s previous CFO study conducted in 2018. Currently, 65% of Finnish CFOs have their focus on serving other business functions, acting as a business partner, and developing a finance target operating model. At the same time, only 3% of the Finnish respondents consider their focus being on business-wide transformation and reinventing value chains and offerings. Moreover, none of the respondents consider their CFO function to be in an ideal target position within the organization.
1. Operational efficiency
2. Business partnering & finance target operating model
3. Business transformation
Finnish CFOs have succeeded in automating manual finance processes and gradually moving the focus toward more value-adding tasks. However, they are struggling to support and drive business transformation in the organization through digital initiatives. Currently, 82% of the CFOs surveyed feel that digitalization is part of the CFO function strategy, but a clear delivery roadmap is lacking. Also, too many priorities and the lack of a clear vision to capitalize on opportunities are key issues constraining a thorough digital transformation in Finnish CFO functions.
The robotization of finance processes is familiar to Finnish CFOs, and 79% have already adopted or are working on the adoption of Robotic Process Automation (RPA) technology, resulting in the highest adoption rate among the countries in the study. However, business transformation is not only about new technologies forming the way business is managed, but also about a comprehensive change in mindsets. Digitalization must have a higher priority, and strategy and technological architecture need to be clarified to serve external, management, and business needs.
82% feel that digitalization is part of the CFO function strategy; however, the lack of a clear vision, a roadmap, and prioritization to capitalize on opportunities are among issues constraining digital transformation. Digitalization must have a higher priority, and strategy and technological architecture need to be clarified to serve external, management, and business needs.
Over 90% of the Finnish companies surveyed responded that they are not as adaptive in their finance operations and leveraging technologies as they would like to be. As a result, only 15% spend more time on value-adding tasks compared to running core CFO function processes. Extending the responsibilities outside the CFO function increases collaboration between businesses and extends the skillsets of employees.
Even though leadership is involved with digitalization efforts, and employees have enough skills to execute the transformation, 56% are uncertain if leadership has the experience and knowledge to lead the digital transformation. Capabilities cannot be utilized or learning supported if leadership does not know how to guide the CFO function.