Payhawk, a global spend management solution for domestic and international businesses throughout the UK, US, and Europe, has announced new research into how well the technology needs of CFOs are being met. The survey of CFOs and other finance leaders finds that only 35% of CFOs believe that their tech stack has kept pace with the needs of the modern CFO and will be able to support future growth, meaning major investment is necessary to close this gap.
The report, The new CFO technology gap, examines how CFOs see their role today, asks how well their current technology stack supports their evolving role, and what changes are planned for tech stacks in response. The research, conducted by independent research house Coleman Parkes, surveyed 1000 finance leaders in large organisations across the UK, France, Germany, the Netherlands, Bulgaria, and Spain.
Key findings:
- 93% of CFOs believe their role has expanded in the last three years and now encompasses regulation, sustainability, and global expansion.
- Only 35% of CFOs say that their current technology meets their current needs and 99% have experienced a problem in the last year.
- The average increase in investment in CFO tools will be 18% over the next five years, at an average value of £147,400
- Over the next five years, the new tech stack is expected to drive a 14% increase in revenue, 16% increase in CAGR, and 20% increase in operating cash flow
Technology needs to support a changed role
The research finds that 93% of CFOs have an expanded role today compared to three years ago. The CFO today is no longer the sole financial gatekeeper it was in the past, but now also a key leadership role with the context and access to data needed to make informed business decisions. Even with this evolution, 65% think that the CFO role needs to keep changing to be more outward-looking.
An overwhelming majority of respondents saw a clear link between the ability of a CFO to fulfil their duties and the technology they use — only 9% disagreed with the idea that “a CFO is only as good as their tech stack.”
Current technology stacks are, however, limiting the CFO’s ability to perform this newer role. Just 35% say that their current technology meets their current needs, and is capable of supporting current growth, and only 23% say their current technology helps to manage and gain insight from growing amounts of data. 35% say that their tech stack cannot support future growth, and for those with global ambitions, 42% say it is holding them back from expanding internationally.
Almost all, 99%, say that they have experienced a problem with their technology stack in the last year—and many challenges were data-related: limited visibility (51%), poor insights (44%), delays (42%), and inaccurate data (37%).
“The CFO role is no longer one of financial gatekeeper, but to fully embrace this role, CFOs need to invest in the right technology, driving growth with the help of a refreshed tech stack,”
said Hristo Borisov, CEO of Payhawk. “The CFO no longer wants to be an ‘operational bottleneck’, and investment in better technology will mean they don’t have to be.”
Investment and high expectations
To address this issue, a quarter of CFOs will make “major changes” and around half will make “significant changes” to their technology stack over the next year. Over the next five years, the average increase in investment in CFO tools will be 18% at an average value of £147,400 with most of that increase coming in the first year.
Expectations of ROI on this investment are high: an average of 14% increase in revenue—representing an average £20M uplift for large enterprises—16% increase in compound annual growth rate (CAGR), and 20% increase in operating cash flow.
There is, however, no expectation that technology will replace people. Around half of CFOs expect their finance teams to grow, even though AI will be a big part of many investments—87% of CFOs say that they trust AI to take on at least some of their responsibilities.
“Today’s CFOs are embracing new challenges, keen to capitalise on the insights their unique position in a business offers,” added Borisov,. “However, the finance department has been neglected when it comes to investment in digital innovation, and as a result can be bogged down in operational matters rather than leveraging data to provide strategic insight.”
“Emblematic of this desire for continued change is the focus on increasing revenue over cutting costs, not traditionally the remit of a CFO — and with it a willingness to invest in the right tools.”
The full report is available for
download.
