CFOs no longer rate Excel as most important skill, turning to new technologies, automation
Adaptive Insights, powering a new generation of planning, today released its global CFO Indicator report, exploring finance automation progress and expectations of CFOs. The survey reveals that CFOs are embracing automation across various areas of finance, driven in large part by a requirement to be more strategic and provide better analyses. Financial reporting and period-end variance reporting top the list of automated processes today, according to the survey.
Automation initiatives are also impacting required skills for finance professionals. Whereas two years ago, 78 percent of CFOs considered proficiency in Excel as the most important skill for their FP&A teams, only 5 percent feel the same today. Looking ahead, only 7 percent of CFOs list better Excel skills as important for new hires. Instead, CFOs rated the ability to be adaptable to new technologies as the top skill for new hires, signaling a shift in desired skillsets for finance professionals in the future.
“We’ve seen CFOs increasingly take on the role of chief data officers in their organisations,” said Jim Johnson, CFO at Adaptive Insights. “At the same time, CFOs recognise the limitations in the way they manage and analyse data today and know it will only get worse with the proliferation of more systems with siloed data. That’s why Excel skills aren’t ranked as a top skill any longer. Proficiency in Excel is a given today. The new skills finance leaders need are those that can use technologies to access, analyse, and amplify data for insights to better manage the business.”
Limitations with manual processes like spreadsheets were recently documented in a Wall Street Journal article, “Stop Using Excel, Finance Chiefs Tell Staff.” The article noted that ubiquitous spreadsheet software that revolutionised accounting in the 1980s hasn’t kept up with the demands of contemporary corporate finance units, citing a lack of automation.
Near-term automation efforts aimed at forecasting and dashboards with AI on the horizon
The new CFO Indicator report discusses the current state of automation in FP&A today; what CFOs see as their key drivers and barriers to adoption; and how automation is changing the skillsets CFOs want in their teams.
Key survey findings show that:
- Data to insights is the biggest driver for automation. Forty percent of CFOs are being driven to automation because they are pressured to deliver faster, higher quality insights to executives and operational stakeholders
- Forecasting and dashboards lead CFOs’ automation plans. Dashboarding/scorecards and planning/forecasting top the list for automation over the next 18 months, yet rank among the lowest areas automated today. This supports the findings that today 80 percent of the FP&A team’s time is spent on data gathering, consolidation, verification and formatting, representing a significant opportunity to automate
- Two-thirds of CFOs say automation has delivered the desired benefit. Citing time savings that frees their teams to focus on value-added tasks, CFOs say automation is delivering on its promises. Yet, 34 percent of CFOs cite a lack of time as the biggest barrier to automation, followed by team skillsets (18 percent), presenting challenges for CFOs in the years to come
- CFOs looking toartificial intelligence (AI). Eighty-nine percent of CFOs believe that AI software will have an impact on the finance function in the next five years. With automation plans underway for many CFOs, the promise of AI offers the opportunity for CFOs to manage growth, maximise profitability, and gauge risk
Looking ahead, CFOs’ top initiatives for 2018 are aimed at continued automation and evolution of the finance function. Specifically, CFOs ranked top initiatives as: 1. refine visual analytics reporting, 2. upgrade technology, and 3. develop professional skills.