Global CFO Report 2024: Low budgets and a lack of experts are slowing down the development of the finance sector

Improving reporting and analytical capabilities are currently the most important tasks of Chief Financial Officers (CFOs).This is according to 152 out of 400 (38 percent) CFOs surveyed by the management consultancy FTI-Andersch. Sufficient investment in innovative financial technology is also required to develop the finance function. However, four out of five CFOs complain about tight budgets (84 percent) and a lack of experts in this field (83 percent). These are the findings of the Global CFO Report 2024 by FTI-Andersch. 35 percent of CFOs spend the majority of their working time on operational processes Two out of three (67 percent) CFOs complain about insufficient support from management The shortage of skilled workers affects almost all companies (94 percent)
July 3, 2024
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56 percent of respondents are working on improving planning accuracy, 39 percent on integrating planning and reporting, 38 percent on better recording of the liquidity situation and almost one in four (23 percent) on improving data management in general.

"Good liquidity planning is essential for companies. Unfortunately, this often only becomes apparent when companies find themselves in uncertain waters," says Ralf Winzer, CEO of FTI-Andersch, the consulting unit of FTI Consulting in Germany that specialises in restructuring, business transformation and transactions. "Although there are a large number of software solutions for this today, we often see major deficits in this area in our day-to-day project work. It is therefore to be welcomed that CFOs want to focus on this among other things this year. In my view, this should be at the top of the agenda when developing the finance area. Of course, they also need the necessary time and resources to do so."

Recording the status quo is often not enough

When asked about the activities that take up the most of their own time, European CFOs stated that these were Financial planning and analysis (48 percent), strategic planning (43 percent) and operational financial processes (35 percent). Dealing with innovation and technology topics was not explicitly mentioned.

"Liquidity planning can also be understood as strategic planning," says Ralf Winzer. "However, it is crucial that CFOs really focus on this. For many, this initially means not so much working on improving the accuracy of planning, but rather properly recording the status quo. Particularly if, for example, several national companies belong to the corporate group, a precise definition of liquidity is often lacking because the respective cash holdings are not clearly differentiated from one another. Once companies have done their homework here, they can take the next step towards scenario planning, technological automation and predictive analytics."

Operational overload is often the reason for a lack of development in the finance area

When it comes to implementing automation and innovative finance technology, the majority of CFOs (84 percent) lack sufficient budget and the right experts in the company (83 percent). 77 percent find it difficult to select the right technology or the right user. 67 percent stated that the support of the management leaves something to be desired.

"The fact that the management leaves the CFOs hanging is astonishing," says Julian Drellmann, Managing Director and expert for the development of finance organisations. "After all, it's usually the CFOs who don't approve the budgets of other departments. Especially as they are almost always part of the management team themselves. The fact that more than two thirds in this survey feel that they cannot adequately represent their own interests shows the inner workings of today's CFOs. However, this is not the picture that we predominantly see in practice. In most cases, operational overload combined with a complex IT infrastructure and too few specialised staff mean that development and innovation projects do not really make progress.

As a result, 94 percent of the CFOs surveyed stated that they were affected by a shortage of skilled labour. 93 percent consider access to top talent in finance to be one of the main challenges. One in four CFOs (23 percent) of companies with a turnover of between €1 billion and €5 billion consider the technological skills of the available workforce to be a problem. Julian Drellmann says: "CFOs will have to be prepared for the fact that the general conditions will not improve. The shortage of skilled labour will increase, as will technological complexity. That's why it's important for CFOs to accept this new scenario internally, to learn to find their way around it and to organise their department accordingly in the future."

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