Foundations for reinvention
As the pace of business reinvention accelerates, finance must reassess its role and relevance. Forward-looking chief financial officers (CFOs) are adopting a transformative vision for the next decade. Our new report with the ACCA and Chartered Accountants ANZ, titled ‘Finance Evolution: Thriving in the Next Decade’, examines the future of finance. Based on insights from 2,300 responses globally, including 85 from Ireland, it highlights emerging trends and offers recommendations for CFOs.
Value creation
Finance is increasingly being looked to for leadership and to guide tough decisions. This means being more present, proactive, and better at understanding the changing levers of value. However, a third of the Irish survey respondents (31% in Ireland and 38% globally) see one of the biggest barriers to enhancing the finance function’s role as a lack of understanding of where finance can add business value. Furthermore, only 22% have a fully defined vision of what their finance function will look like in three to five years.
So, what’s the way forward? It is clear that finance can no longer recede into a support role. Instead, it must be clear on what it needs to be known for, what it needs to deliver, and in creating its brand as a driver of value. Successful CFOs are adopting stakeholder value principles and addressing the ESG agenda. They develop a detailed understanding of the levers that drive revenue growth, enhance profitability and improve working capital, while also providing leadership on ESG objectives. Essentially, the CFO is starting to emerge as the chief value officer — the orchestrator of value creation and preservation.
Lack of understanding of the areas where finance can add business value
Trusted data
One of the key purposes of any successful finance function is to provide trusted data that is clean, actionable and available when needed. However, as transactional finance activities become increasingly automated and tech-powered, real differentiation will stem from the intelligent use of structured and unstructured data from both within and outside the organisation. Therefore, the ability to work with and understand these data sets will remain a fundamental skill required of finance professionals.
Our most recent CEO Survey shows that nearly two-thirds (63%) of business leaders expect Generative AI (GenAI) to significantly change how their business creates, delivers and captures value. However, a similar percentage (62%) are worried about the increased risk of misinformation spreading across their business. Finance professionals need to take a proactive approach to changes in the regulatory landscape, including the EU AI Act, and risk management developments. In some cases, this may mean that finance needs to assume an organisation-wide data quality role.
Data governance will undoubtedly be a fundamental building block of the finance function of the future. Consequently, organisations need to invest in their data management strategies and the associated skills and technologies.
Poor quality data identified as a barrier to enhancing the role of the finance function
GenAI: A game-changer for finance
Current technology not meeting organisational needs was identified as the biggest barrier by 46% of Irish finance professionals, compared to 30% globally. Finance teams must embrace technologies like artificial intelligence (AI), machine learning and data analytics to enhance decision-making and operational efficiency. GenAI can supercharge data extraction and analysis, generating insights in seconds that would have previously taken weeks. Continually learning and adapting, GenAI solutions can mirror your presentation styles and adopt your business terminology.
Despite its potential, finance functions are still figuring out where to start with GenAI as the technology and associated solutions evolve. Organisations should start small and simple, experiment at pace, and foster creativity and curiosity. A key part of this journey will be learning what’s feasible and where value can be found. In our report, Irish respondents identified where they believe AI could provide value in the next three to five years and had a stronger view of GenAI benefits compared to their global counterparts.
The top opportunity areas identified by Irish respondents include data mining and analysis, accounts payable, financial planning and analysis, general ledger/journals, and accounts receivable.
Which of the following activities do you think that artificial intellegence (AI) could be a useful tool for within the finance function in the next 3-5 years?
Tech-powered processes
The increasing use of cloud-based enterprise resource planning (ERP) systems is helping to drive process simplification, standardisation and automation. However, only 29% of Irish survey respondents currently consider their core finance applications to be fully integrated. This is expected to more than double to 65% within the next three to five years.
Investing in the latest generation ERPs is a business rather than a technology imperative. It should be aligned with the business strategy to deliver a range of benefits, including more relevant and impactful data and analytical capabilities to support effective decision-making and increased flexibility to scale as the business grows. Modern ERPs improve integration and efficiency across processes by adopting leading practices and enable companies to benefit from innovations through automated upgrades. One such innovation is the ability to access powerful GenAI capabilities from within modern ERPs, leveraging the organisation’s trusted data sources.
The key to realising this potential is to use the opportunity to transform ways of working, rather than merely viewing it as a technology upgrade.
To what extent do you consider your organisation's core applications (such as ERP / AP / AR/ General Ledger / Sales / Procurement) to be integrated?
Talent and skills constraints
The people aspects of the future vision for finance are a key concern for many, potentially hampering the function’s progression and evolution. Concerns include the talent deficit, the new roles and skills needed, and the changing nature of career paths. When asked about the greatest skills and talent deficiencies in the next three to five years, survey respondents highlighted digital, data and sustainability skills as the most significant.
While these skills are crucial, other abilities like influencing, communication and decision support must not be forgotten. These skills remain essential for finance to drive the strategic goals of an organisation.
The report also identified intergenerational differences in attitudes to work as a significant influence on the future nature of the finance function, including varying work-life balance expectations between new entrants and those who joined the workforce in prior years.
Technology was highlighted as a means to address some of these expectations, such as balancing workloads to minimise peaks. However, finance leaders need to go beyond this, ensuring they can clearly communicate the purpose and value the function delivers to the organisation and society. Redefining the function’s purpose to attract new entrants is seen as non-negotiable.
In which of the following areas do you expect to have a skills and talent deficit in the next 3 - 5 years?
Key actions businesses can take today
1. Leading with value
Be clear on the changing dynamics and value drivers within your industry. This clarity allows you to challenge legacy business models and assumptions, laying a path for modernisation in an affordable and managed way.
2. Leading with performance
Ensure trustworthy, high-quality information. An abundance of poor and conflicting data can limit visibility of what matters most. Define the sources you will trust and the metrics that matter, using advanced analytics to enable a proactive stance with early interventions.
3. Leading with data
Define and protect the golden data sources that underpin trust. Poor data erodes trust and creates conflict. Finance can take the lead in ensuring governance, control and accountability in maintaining data quality. This involves moving to continuous policy compliance and anomaly detection to nudge the business toward a right-first-time approach.
4. Leading with tech-powered processes
Good processes are crucial for the effective and efficient operation of finance. Technologies can both enable and hinder great processes and data creation. It is critical therefore to take an enterprise-wide, business lens on technology to ensure it supports how business works.
5. Leading with change
As 28% of Irish CEOs believe their company won’t be viable in ten years if it stays on its current path, identify the right people and engage your teams with meaningful experiences to build lasting momentum. Be prepared to look for talent beyond traditional channels and across generations.
We are here to help
Our Finance Transformation team is here to assist you in addressing these issues and challenges. We aim to ensure that your finance function is well-positioned to meet the needs and expectations of the next decade. Contact us today.
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