FSN’s Innovation in the Finance Function Survey 2018 is one of the largest surveys of its kind covering responses from than 1,000 senior finance professionals worldwide. It is the first time that there has been an in-depth study of attitudes to innovation in the finance function and it reveals startling insights about the appetite for finance innovation, including the impact of culture, attitudes to risk, organizational politics, style of project investment and levels of confidence in measuring return on investment.
The research shows unequivocally a strong link between innovation in the finance function and performance. Those organizations that are early adopters of technology or invest in innovation in a balanced way across the enterprise outperform organizations that are diffident, less structured in their investment approach and risk averse. Innovative finance functions close their books faster, produce more accurate financial forecasts and are less tied to legacy systems and traditional ways of working. Furthermore, innovative finance functions attract the best finance talent, leaving everybody else in their wake.
Encouragingly, 34% of finance functions are actively involved in innovation with around two thirds of these, pursuing opportunities for innovation more widely across the enterprise. But the study also finds that what constitutes innovation is very much in the ‘eye of the beholder’. For around 20% of respondents it’s a new ERP system and for another 20% it’s about driving insight through enterprise performance management applications. However, 35%, remain shackled to legacy systems. These finance functions must console themselves with innovations at the margin i.e. relatively small changes in standardization, automation and integration. And for some, finance innovation is about how the finance function is organized rather than the latest digital technologies.
Regional differences, especially between economically advanced and developing nations colors attitudes to whether innovation is supported and, if it is does have management backing, where investment is most needed. Nevertheless, wherever finance professionals reside and no matter how sophisticated their investment plans, all agree that the number one priority for innovation is around the need for better business insight.
The report also identifies the principle obstacles to innovation. Chief among these is an inability to measure the return on investment in technology. There is clearly cause to be optimistic about innovation in the finance function but there are also some formidable challenges. For example, more than 65% have yet to get their ‘hands dirty’.
We hope that you find the survey’s findings set out in this document thought-provoking and interesting. But above all we hope that the contents of this report together with FSN’s “Innovation Showcase”, which describes the latest innovations in the vendor community, will inspire you to explore and discuss innovation in your own organization with your colleagues.