One of these is India. Corporates within this diverse economy, with its flourishing technology and renewables industries, are experiencing clear divergences from their global peers.
Close to half (46%) of respondents cite raising capital for new products and initiatives as their top challenge in executing their day-to-day activities, well over the global average (29%).
The top challenges they face in executing their day-to-day activities is a good place to start. Close to half (46%) of respondents cite raising capital for new products and initiatives, well over the global average (29%). This may reflect the external macroeconomic environment (given the recent currency depreciation) as well as challenges in managing their company’s financial performance, which has a bearing on access to capital. An equal share of respondents cites identifying how to align strategic, financial and operational plans towards common objectives as a top challenge.
These differ from global concerns over the pace of change (top choices globally are managing unexpected changes to financial forecasts and adapting financial processes to rapidly evolving business models). As a result, we see key differences in their approach to fulfilling their broader strategic mandate.
Managing the budget
In the face of its challenge to raise capital, strategies to safeguard company budgets and manage expenditure will clearly be important. The top two strategies used most frequently are introducing software to share information for better decision-making and automating activities to reduce costly errors. Finance executives have also restructured the business or division to drive synergies to manage costs.
Combined, these suggest that India’s finance executives favour a more targeted approach to managing expenditure. This is further reinforced by the fact that only 9% say that they have applied across-the-board cost reduction, the second-most frequently used strategy globally (cited by 20%).
Intent and empowerment: a perfect match
Driving this targeted approach are finance executives who are empowered to steer strategic and operational decisions through collaboration. India’s CFOs and their direct reports strongly agree that the finance function should facilitate collaborative enterprise planning across the company (60% of respondents). Interestingly, the percentage that also strongly agrees that they personally feel empowered to drive strategic decisions is exactly the same for India’s finance function (60%), significantly higher than global and regional averages of 45% and 46% respectively. Indeed, India was the only country in the entire global survey that returned this perfect match between intent and empowerment.
This is driving engagement with key business functions. In India, finance executives believe they can make the most contribution through greater involvement in guiding regional management on evolving tax procedures and business regulation with operations (70%) and identifying new products and services/product portfolio optimisation with marketing and sales (66%).
Views on emerging tech
But despite feeling empowered, the challenges that India’s finance executives face in trying to improve collaboration will undoubtedly impact their ability to steer the business. They cite limited understanding of valuable information available in other functions as a hindrance to more and better collaboration, as well as resistance from department heads.
These internal cultural challenges, as well as the differences articulated in day-to-day challenges, go some way in explaining the different solutions that India’s CFOs and their direct reports seek. When thinking about technology that could most improve collaboration, although the top choice was cloud computing for remote access (in line with global results), respondents in India are the most likely globally to cite automation of day-to-day activities using artificial intelligence and digital voice assistants (40% v 30% globally). They are also significantly more likely than those in other countries regionally or globally to choose virtual or augmented reality (38% v 21% elsewhere regionally and 22% elsewhere globally).
Importantly, they are significantly less likely to cite predictive analytics for strategy development and decision support (14% v 36% elsewhere regionally and 32% elsewhere globally). This once again reinforces the fact that the pace of change is less of a concern.
Respondents in India are significantly more likely than those elsewhere regionally or globally to anticipate automation of the CFO role—68% believe at least 40% of the role of the CFO will be automated in five to ten years (compared with 43% elsewhere regionally and 45% elsewhere globally).
Automation will undoubtedly feature in the future of India’s finance function. Respondents in India are significantly more likely than those elsewhere regionally or globally to anticipate automation of the CFO role—68% believe at least 40% of the role of the CFO will be automated in five to ten years (compared with 43% elsewhere regionally and 45% elsewhere globally).
But the adoption of advanced technologies far from diminishes their role—those in India believe that future finance executives must be proficient in emerging technologies and possess data science and analytical skills to capitalise on future automation. This surely suggests that India’s CFOs and their direct reports value a whole-team approach to tackling the challenges of change and steering their companies to meet strategic objectives.
