More funding in this area than any other in 2021.
The COVID-19 pandemic has forced the acceleration of digital, leading to CFOs planning to increase technology investments, with 82 per cent saying they intend to increase investment in digital capabilities in fiscal year (FY) 2021 compared to FY20, according to survey by Gartner. The survey of 115 CFOs was conducted by Gartner between July – December 2020, and it also revealed that 70 per cent of respondents intend to increase spend in information technology in this fiscal year.
“As COVID-19 lockdowns were imposed, most finance organizations tried to digitize as many processes as possible to move to a virtual work environment,” said Alejandra Lozada, senior director analyst in the Gartner Finance practice. “CFOs also view technology as a competitive differentiator that can widen the performance gap between their businesses and those of their peers.”
Lack of Clarity on Digitalisation
“While CFOs are planning to increase their digital investments (see Figure 1), our survey also showed that they are less clear on what digital business means and the technologies with the most significant impact on their businesses. This could be a challenge.” said Ms. Lozada. “CFOs need a clear digitalization language and vision to focus their teams on the key investments and initiatives required to accelerate transformation. This clarity is needed to make coherent technology investments that enhance one another.”
Gartner experts have three recommendations for CFOs planning their next digital steps:
1) Maintain a balanced technology investment portfolio: The technology portfolio must balance technology opportunities that can yield long term business value with low-effort, low-complexity initiatives (such as piecemeal automations) that have shorter payback periods.
2) Select technologies based on finance’s needs: Instead of picking technologies based on market trends, CFOs should begin with defining their business and finance objectives and then look for technologies that will assist in achieving those objectives.
3) Involve cross-functional stakeholders early: Limited visibility into the wider organization’s IT efforts will lead to overlaps and conflicts with other business units. CFOs can avoid this by consulting with other business units and central IT at each step of the technology roadmap, and this has the added benefit of facilitating buy-in at later stages.