The biggest day-to-day challenges are managing unexpected changes to financial forecasts and adapting finance processes to rapidly evolving business models, according to a new survey by The Economist Intelligence Unit, sponsored by SAP.
The blurring of lines between the mandate of other C-suite/function leaders is among the top challenges respondents in Spain face in executing their day-to-day activities (38% compared with just 17% globally)
Cross-company collaboration led by the CFO is a clear solution to these challenges—respondents in Spain cite more accurate financial forecasts as the top benefit of collaborating with other business functions. But it is the challenges that finance professionals in Spain face in trying to have more and better collaboration with other business functions that present the biggest contrast to the global picture, especially when it comes to strategically steering the business.
The blurring of lines between the mandate of other C-suite/function leaders presents them with an issue, selected by 38% compared with just 17% globally. Limited understanding of common goals was also among the top three challenges. However, this does not seem to stem from cultural issues—differences in department culture and resistance from department heads are impediments for only 10% of respondents, compared with 17% globally for both.
It is incumbent upon CFOs in Spain, therefore, to clearly define their role in steering the business through a rapidly changing environment. There is a strong belief that underpins this—62% of respondents strongly agree that finance should facilitate collaborative enterprise planning across the company to ensure operational plans are aligned with financial and strategic plans, higher than global and regional averages (56% globally and 51% in EMEA).
Defining priorities for the future
Their desire for a deeper dive into the HR, marketing and sales, and procurement departments mirror the wishes of both global and regional finance executives. Executives in Spain say they want more involvement in the core elements of each function: talent acquisition and recruitment strategies and employee retention strategies with HR; assessing the effectiveness of marketing campaigns and developing sales strategies by product, geography or client with marketing and sales; supply-chain analysis for mergers and acquisition opportunities assessment; and supply chain capacity management with procurement and supply chain.
It’s on operational matters that wishes diverge. In Spain, finance executives were most interested in getting involved in cyber-security risk analysis and strategies (64%) and guiding regional management on labour management policies and legal requirements (56%), while global and EMEA respondents want more involvement in reviewing risks around automation—an area already the remit of a majority of Spanish finance executives.
Across sectors, for integrated risk management, finance executives in Spain believe they need most collaboration on detecting, managing and deterring fraud and other business irregularities (28%), much more than in the UK and Ireland (20%) and Germany (8%).
A delicate balance: technology and the workforce
The second biggest challenge for more and better collaboration was limited time to collaborate with other functions given the current workload, the top challenge globally. Emerging technologies may provide a solution to this, one that finance executives in Spain are already inclined towards. The strategy used most frequently to manage expenditure across all areas of the business was automation to reduce staffing costs, chosen by 30% of respondents, a figure that contrasts sharply against the global average of 15% and the EMEA average of 17%. Over 70% believe that cloud computing and other real-time information-sharing technologies will most enhance collaboration.
Automation within the finance function can also address the issue of limited time for collaboration. A higher share of respondents in Spain than in other European countries anticipate that 30-50% of the role of the CFO will be automated over the next five to ten years—52% in Spain compared with 39% each in Germany and the UK and Ireland.
A higher share of respondents in Spain than in other European countries anticipate that 30-50% of the role of the CFO will be automated over the next five to ten years—52% in Spain compared with 39% each in Germany and the UK and Ireland.
Despite this, Spain’s finance function places great value on its human workforce. Should automation free up 30-50% of their time, nearly two-thirds say they would spend more time training the team on more advanced financial/technical skills and over a third (36%) would offer employees additional time off. They see finance team members adding value by building on outputs of advanced technologies—evident in the non-traditional skills they believe are imperative for future finance executives. Data science and analysis is the top skill, cited by 52%, significantly higher than the global average (37%).
It’s clear that Spain’s finance function enjoys a backing from department heads and a culture that appears to support collaboration, albeit with a need for better internal communication on company goals and leadership mandates. With this in mind, CFOs in Spain must forge ahead in defining a role that will allow them to steer the business as the industry around them evolves.
