According to Socrates, the path to wisdom begins by admitting one’s own ignorance. Today’s chief financial officers are part of the way there, but there’s still an undercurrent of denial about their technological preparedness for the new, post-pandemic business paradigm. 

This is one of the standout findings from new research by Tradeshift in partnership with CFO Dive, which reveals an underlying tension between what capabilities CFOs know they need to implement and how well they believe they’ve achieved those goals.  

The analysis and insight gap

According to our survey, almost three-quarters (71%) of CFOs said their organization had mostly centralized their financial data, with very few silos remaining. That’s clearly good news. But a deeper dive into the data reveals the tension below the surface. 

For example, over a third of respondents (37%) said they lacked the internal expertise to properly analyze their financial data, while 35% said they did not have the technology in place to gain strategic insights from their financial data. 

This tension — if not quickly recognized and resolved — could prevent organizations from making correct and timely strategic calls as they struggle to adjust to a rapidly changing business ecosystem. It’s all very well centralizing financial data, but if organizations can’t put it to good use, then very little benefit accrues from breaking down those silos. 

It’s not enough to hand over the database keys to heads of accounting, planning, finance and operations department; they also need the tools that turn raw data into instantly usable insights. That helps explain why 91% of CFOs either strongly or somewhat agreed that increased data transparency between departments would help in addressing their organization’s financial priorities.

Talent tops the business wish list

There’s a growing realization that tech alone does not provide a silver bullet to the new and profound challenges businesses face today. 

In a world where technology is turning from a tool to a platform for entirely new ways of thinking, planning and doing, it’s never been more important to have a highly skilled and motivated workforce empowered to extract the full range of value that modern technologies can provide. Where once employees were given a tool to do a specific job, now they are asked to use technology to reimagine their own roles, their colleagues’ — and even the strategic direction of the whole organization. It’s no surprise that securing people who can properly use and analyze the data provided by that technology is integral not only for today’s success but also for the enterprise’s evolution. 

The problem for CFOs thus becomes one of figuring out how much of their valuable time to spend in this area. For example, just over a third (35%) of CFOs said they didn’t have the technology in place to gain strategic insights from their financial data. And while 41% identified talent acquisition and training were a key factor in their overall strategy for technology investment, that still leaves a majority who have not fully considered the importance of highly skilled human talent in achieving the full benefits of a digital transformation strategy. 

Will those who fail to focus on developing the capabilities of their workforce remain competitive? The question is pulled into even sharper focus by studies that suggest that the Great Resignation showed no signs of slowing in 2022, with one in four workers planning to quit. CFOs who hope to get a jump on their goals for 2023 would do well to put the proper planning and focus behind the teams that will help them do exactly that.

A fully performing finance function

Nowhere is this inner tension more clearly revealed than in the actual results that CFOs are seeing — or believe they are seeing — from their technology investment. For example, nearly all our respondents said their company’s current finance function was performing satisfactorily or better when it came to optimizing working capital (93%), delivering real-time information to make business decisions (85%), and improving planning, scenario modeling and forecasting (83%).

And yet, when questioned in detail, it’s obvious that the tech is failing to fulfill its promises. Besides lacking the internal expertise to properly analyze financial data and missing the technology to gain strategic insights, a quarter of CFOs (23%) conceded to not having a single source of truth for their financial data, with the same percentage saying their financial data was incomplete, and 17% that their financial data was outdated. 

On a more positive note, CFOs are clear about where their immediate priorities lie. Nearly half (49%) indicated that providing a more detailed vision of business cash and liquidity was a high priority for their organization, while 41% said process automation was high on their wish list. 

This disconnect between what CFOs say about their finance function’s performance and the long list of needs, challenges and desired improvements shows that the finance department requires a root-and-branch rethink of their technology strategy in the new year. As new and future challenges pile up — from the problems of recruiting and retaining skilled staff to the urgency of adding agility to business operations and strategy — CFOs desperately need the ability to identify and resolve the gaps in their data, insights and capabilities before they start to impinge on the rest of the business.

To learn more about how CFOs are tackling their shifting roles and using technology, as well as their plans for the future, click here to read the full Tradeshift/CFO Dive report, “Building for Change: How CFOs’ Priorities Are Shifting From Efficiency to Creating Long-Term Value.