Internal complexity is a greater challenge for CFOs than external forces

Finance chiefs find regulation less of an issue than dealing with systems and stakeholders

Internal complexity is the biggest challenge facing CFOs today, a report by Accenture suggests.

According to the study, The CFO as Architect of Business Value: Delivering Growing and Managing Complexity, the internal challenges facing finance functions are greater than those posed by external forces.

CFOs reported falling levels of concern over regulation (53% in 2011 to 39% in 2014); permanent volatility (46% to 38%); and talent (40% to 21%).

Instead, four out of five of the top challenges that CFOs face are due to internal complexity. These include dealing with legacy systems and environments (55%); managing the complex needs of all stakeholders (48%); addressing new and complex business risks (46%); and supporting increasingly complex operating models (28%).

But, on a positive note, the study found that the influence of CFOs is increasing as a result of their involvement in growth-related and business-transformation activities.

Almost three-quarters (73%) reported that the CFO’s influence in supporting strategic decision-making has increased in the past two years. Meanwhile, 60% say that the CFO’s influence in providing insightful analytics has grown and 61% report that the CFO’s influence in partnering with enterprise functions has also risen.

Despite their greater influence, however, only a minority of CFOs play a consistent role in the vision, design and implementation of key business initiatives beyond functional cost reduction. For example, relatively few CFOs are involved in developing the company’s vision as it relates to workforce rationalisation (18%), supply chain optimisation (18%) or the digital revolution (10%).

Commenting on the results, Christian Campagna, global MD – Accenture Strategy, finance and enterprise performance, said: “Following the economic downtown, many CFOs were forced to take a defensive approach to managing the external challenges. Now we’re seeing finance executives proactively addressing new internal sources of complexity, which in many cases are the by-products of growth and strong performance.”

He added: “While complexity will never be eliminated, the most proactive CFOs understand that they not only need to manage complexity in all of its forms, but also embrace it as an opportunity.”

About the author

Sally Percy is editor of The Treasurer

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