There is a huge gap between the potential value that the finance department can deliver to its stakeholders and the actual value now being delivered.
Here's some not-so-cheerful news to begin the new year: There will be more pressure on the role of the chief financial officer in 2013 than ever before. Sounding a note of pragmatism rather than optimism, Jamie Lyon, head of corporate sector at trade association ACCA, says, "Businesses are asking a lot from their top finance leaders right now, and we don't see this getting any easier, particularly with the current level of volatility and business uncertainty."
This situation, Lyon says, will find finance leaders under great scrutiny, but it will also provide opportunities for them to take a more influential role within their companies. That's assuming, of course, that they actively seek out such a role, and that may not always be the case.
According to a recent survey of finance professionals conducted by benchmarking firm APQC (in conjunction with EPM Channel), there is "a staggering gap" between the potential value that the finance department can deliver to its stakeholders and the actual value now being delivered. "Surprisingly, only 5% of survey respondents believe that finance is currently delivering game-changing value to their enterprises," says Mary Driscoll, senior research director, financial management, for APQC.
"There are many reasons for this gap in performance," Driscoll notes, "but the primary one is an age-old albatross: Finance is often bogged down with transactional work and doesn't have the time to produce meaningful analysis. What's more, many finance professionals lack the soft skills necessary to present concisely to senior operating managers and to persuade with diplomacy."
But as the APQC study also reveals, 42% of those same respondents believe that finance has the potential to deliver game-changing value. So how does that potential become realized? Nearly half (45%) of respondents say they lack the right technology to make finance more efficient and effective. Not surprisingly, then, the biggest demand for talent right now is for financial planners and analysts. Sixty-four percent of respondents say these are the hardest vacant positions to fill.
"Traditional skills, such as financial planning and analysis, are a must for finance leaders," Lyon agrees, "but we know that they need to bring much more to the table, particularly capabilities such as communication skills, influencing skills and a deep understanding of the business environment.