Finance not exploiting technology: report

CHIEF financial officers (CFOs) and finance functions across companies around the world are not fully exploiting emerging technologies to better support their businesses, says a new report from ACCA (Association of Chartered Certified Accountants).

The report, "Is finance function technology delivering on its promise?", sought in-depth views from finance executives across a spectrum of businesses, including Shell, IBM, Aviva, Accenture and BBC.

Leong Soo Yee, head of ACCA Singapore, said: "The problem is not necessarily that technology isn't available, but there are many reasons why finance has not yet reached tech nirvana. The reality is for most finance functions the technology landscape is still complex and fragmented with multiple ERP (enterprise resource planning) solutions, continuing work-arounds and bolt on applications.

"But this report suggests there are bigger issues too. It is about behaviours, vision and culture in the finance function to go that step further and really push for technological change," she added.

She pointed out that it is neither true nor fair to say that finance service operations have been standing still for the past 10 years; leading companies have deployed technology to improve finance service delivery to the business.

But, the primary focus has been around cost, efficiency and quality in transactional finance, and driving standardisation and improving controls.

Business leaders interviewed by ACCA concur that there are opportunities for further technology application in finance services. George Connell, vice-president of Strategy, Finance Operations and Centre Finance Lead (Glasgow), at Shell, said: "In my experience working for a big corporation, there's still far too much manual work, there's far too much reliance on spreadsheets. We're not properly leveraging technology and I don't think we've got full agility as well."

The report also found that the finance function is not showing enough leadership in pushing a bigger technology agenda. This could be due to the historic caution and risk-averse positions that finance professionals take. The focus on rules and risk may, quite possibly, obstruct new thinking not only about finance processes themselves, but also about how value is created, the report noted.

Simon Newton, finance director, Partnership Services, at upmarket department store chain John Lewis, said: "Is finance showing sufficient leadership in the area of finance technology? To me the answer to this question is no - we're still locked into our process world and are behind what's truly relevant."

Deborah Kops, principal at Sourcing Change and co-author of ACCA's report, said: "Finance can, through technology, eliminate its preoccupation with processes. Harnessing technologies that mine data for patterns means the function can become a game changer for business. Finance leaders have tended to rely on their technology colleagues rather than members of their own teams to plan their technology 'roadmaps'."

This then begs the question of whether finance professionals need to become technology experts to effect the necessary transformation?

ACCA's report says experts believe that global process owners must now take more responsibility for technology deployment, resulting in a new duality in the relationship between finance and technology - and, finance must create the vision and set the requirements. At the same time, finance professionals should work very closely with technology experts who understand the capabilities and the enterprise environment and can drive innovative thinking about deploying applications.

Julie Spillane, managing director of Accenture Global Services, says: "Collaboration is key. Traditionally, it was up to the CIO (chief information officer) to bring technology acumen. But none of what we do in the future is going to be pure technology. Today, there is such an incredible mix of business with technology that it's going to be hard to draw the line."

Ms Kops concludes: "We should also acknowledge that the application of technology has the potential to change further what a finance career means. If technology increasingly automates transactional finance and is also able to mine insights at the same time, it will change what it means to be a finance professional as well as the capabilities needed."