Amid the flurry of B2B FinTech innovation aiming to transform organizations' back offices, there is often one common threat within the disruption: the need for previously siloed, disconnected systems and processes to integrate with each other, offering a streamlined, holistic view of the enterprise. This is especially true in finance-related functions like accounting, procurement, payroll and treasury, and a new survey from Workday suggests chief financial officers are recognizing the opportunities in a more collaborative approach to their positions.
The recent research released by Workday analyzed how CFOs and senior finance leaders approach collaboration in an effort to enhance their role's ability to add value to the enterprise. More than 670 professionals at mid-sized and large firms were asked about how they collaborate with human resources and IT departments, both areas of the enterprise that have significant impacts on financial management.
What emerged is a picture of CFOs prioritizing collaboration as part of their broader digitization efforts, with the rising need to look beyond financial data to reshape corporate finance. At the same time, however, Workday uncovered a range of roadblocks to this effort — including CFOs and financial executives not "speaking the same language" to their chief information offers and IT peers, and the struggle to aggregate data across siloed systems beyond their direct financial management tools.
"While people may understand the benefits of collaboration, doing it well is another story," Workday wrote in a blog post last week, announcing the report. "Part of the problem is that, in the past, functions have often pursued narrower goals, with people working in their silos, barriers emerging between departments and incompatible team cultures that can hinder understanding and communication."
In particular, the relationship between the CFO and CIO can be a make-or-break collaboration for the finance function's ability to transform, Workday concluded. Chief financial officers must understand and value the potential that IT teams bring, in the form of enhanced data analytics and technology adoption.
Workday pointed to Deloitte Consulting's Principal Matt Schwenderman to further explain how CFOs should become closer to CIOs.
"The CFOs that I consider to be progressive and innovative have a very different view of that relationship," he said in a statement. "They actually look to the CIO for ways to improve their own function, and are using the CIO to bring knowledge and skills that can be leveraged by finance."
To dive further into the collaborative efforts of the CFO, and the potential of stronger collaboration with CIOs and IT teams, PYMNTS breaks down some of the key data points from Workday's "Finance Redefined" study below.
Six percent of CFOs said they enjoy "seamless collaboration" with CIO and chief human resource officer counterparts. That's not very much, considering how analysts view these relationships as critical for CFOs. Research suggests a range of issues preventing a collaborative relationship from forming. For example, 68 percent of CFOs said the biggest roadblock is that their CIO peers do not "speak the same language." Chief sales officers are currently the most connected to the CFO, with 37 percent of CFOs saying they collaborate seamlessly with these professionals.
Fifty-five percent of CFOs said their relationship with the CIO is one of "tension and disagreement." Two-thirds said IT professionals appear reluctant to collaborate with financial executives, with teams clashing over a variety of matters. For instance, Workday noted, IT's desire to invest in new technology will often clash with the finance team's efforts to limit overspending.
Thirty-nine percent of CFOs said they are fully confident in managing top risks, meaning the majority lack the confidence they need. The number-one reason why, Workday found, is because CFOs are unable integrate finance and non-finance data to uncover and analyze their risks. Furthermore, researchers found CFOs lack the knowledge and skill set needed to mitigate risk.
Thirty-seven percent of CFOs extensively use advanced analytics for financial reporting purposes, and even fewer use analytics technology for their budgeting and forecasting operations, risk management and cost reduction analysis. Yet, 44 percent of financial chiefs expect to use advanced analytics for financial reporting in three years time, making it the most popular target for the technology.