Chief financial officers (CFOs) were among the last to fully trust cloud technology for their organizations, according to research from software company Adaptive Insights. But, as its third-quarter CFO Indicator report shows, the portion of CFOs that embrace the cloud has spiked in only the last few years.
Part of that trend, researchers said in the report, is the effort among financial executives to establish a “single source of truth” for their companies — a streamlined, consolidated source of up-to-date financial data. The cloud is critical to creating that “single source.”
“The cloud enables a level of data access that finance teams need in order to meet the demand for accurate, real-time information from across the enterprise,” said Adaptive Insights founder and chairman Robert S. Hull in a statement last week. “This quarter’s report validates that CFOs are embracing cloud technology for their financial data.”
But, while CFOs trust the cloud, Hull warned that these professionals still have yet to realize the single source of truth of their financial data.
“Despite this shift, the majority of CFOs still do not have a single source of truth for their organization, delaying decisions,” he continued. “This lack of agility results in documented losses in revenue and business opportunities.”
For its research, Adaptive Insights surveyed 255 CFOs across the globe in August. In an infographic, Adaptive Insights allows the data on the disconnect between CFOs’ cloud adoption and ability to consolidate financial data to speak for itself. PYMNTS takes a look at those data points below.
Seventy-three percent of CFOs trust the cloud for their financial data today, a major increase from just three years ago, when only 33 percent had the same confidence, Adaptive Insights found. Researchers said this data point represents a “significant technology shift” for the finance department in particular, which has been especially slow in adopting cloud technology.
Seventy percent of CFOs lack confidence that they have the data they need to make timely business decisions, a worrying sign that, while financial executives may be trusting of the cloud, they haven’t yet been able to use the technology to gain real-time visibility and access into key financial data for their organizations. According to Adaptive Insights, companies’ ongoing use of spreadsheets could be contributing to this lack of confidence, as these outdated solutions result in siloed data sets. That means collecting and analyzing financial data takes time and, according to researchers, reduces trust in the data that’s been manually extracted.
Fifty-one percent of CFOs that don’t have a single source of truth say the cost of having that single source is too high. It’s unclear from the research, however, where CFOs’ beliefs that the costs of building a single source exist. Still, researchers warn that despite CFOs’ cost fears, it may actually be more taxing and damaging to the organization not to push forward with the cloud and build that streamlined, unified source of key financial and operational data they need for quick, accurate decision-making.
Twenty-one percent of CFOs aren’t working on a “single source of truth,” meaning these financial executives are willing to continue with siloed and manual financial data management. The financial executives surveyed cited the cost, hurdle of changing legacy systems and challenges that arise from multiple data sources as key reasons for not taking action.