A report from the American Institute of CPAs and Oracle shows how finance leaders are embracing a new finance model, as well as the skill sets required of their teams.
To remain relevant in a rapidly changing business environment, organizations must embrace a new model of finance, according to a new report from Oracle and the American Institute of CPAs (AICPA). The report, “Agile Finance Revealed: The New Operating Model for Modern Finance,” offers guidance for management accountants and finance professionals and identifies the traits of agile finance leaders.
Based on a survey of senior finance executives and in-depth interviews with CFOs who have embraced new operating models, the report includes insights from 483 finance executives in large businesses and other organizations across the United States and Canada in five industries: financial services, manufacturing, retail, healthcare, and finance.
The report describes the three key attributes that CFOs and their teams need to implement a new operating model. These include having crossfunctional and integrated teams, digital technology expertise, and nontraditional finance skill sets.
Regarding integrated teams, the report found that centralized shared services, supported by cloud and digital technologies, make accounting services more efficient and improve overall business performance.
Business finance processes are becoming integrated into operational processes, said Ash Noah, CPA, CGMA, vice president of Chartered Global Management Accountant external relations at AICPA. “The greatest challenge is for finance to be engaged with the business and bring a deep understanding of the customer, markets, and external environment to the team,” he said.
According to Noah, finance teams often lack this deep understanding, are slow to adopt the latest technological solutions, and don’t have the business, people, and leadership skills to communicate and collaborate well. “Once these challenges and gaps are addressed, finance will possess greater agility and be better able to integrate,” he said.
Associations, in particular, “should be looking at their business and service delivery models to ensure that finance is brought in as a strategic partner,” Noah said. “Associations need to look at how they can enable their finance and analytics function to become more agile. Harnessing cloud technology not only transforms the internal capability to analyze, visualize, and operate with agility,” but it also enables the organization to better serve its customer base.
Expertise in digital technologies, such as big data analytics and artificial intelligence, allows an organization’s financial planning and analysis role to be more predictive and generate important insights, the report says.
The nontraditional skill sets the report identified include expertise in statistics, data analysis, data visualization, and business partnering to support rapid decision-making and new performance management models.
“The shortest path to achieving agility is to address the competency gaps,” Noah said. “Finance needs to both recruit and develop talent with a broader skill set that includes business acumen and commercial awareness.”
The report found that more than 80 percent of organizations are still in the process of implementing the initiatives required to transform their finance model. Forty-two percent of finance leaders also said they need more data analytics skills to deliver more forward-looking analysis for their business.
“The development and acquisition of skills should be top priority,” Noah said. “Associations should focus on creating capacity in the finance function—and all functions—by investing incrementally in automation and cloud technology.”