In today’s tough economic environment, CFOs have limited options to drive growth: take market share away from existing competitors, grow through mergers and acquisitions, or create entirely new categories of products or services. To find out how emerging technologies are helping CFOs execute on these growth strategies, Oracle conducted four real-time surveys with 250 CFOs over the course of 2012, most recently at the Oracle CFO Summit at The Executive Edge at Oracle OpenWorld 2012. The combined survey results provide surprising insights into CFO attitudes toward - and adoption of - emerging technologies such as big data and business analytics, and mobile, cloud, and social computing.
According to McKinsey research, C-levels worldwide believe that just four emerging technologies – big data and business analytics, along with cloud, mobile, and social computing – will help boost operating profits by over 10 percent by 2015. CFOs surveyed by Oracle Chairman Jeff Henley agreed with that assessment, with 46 percent ranking mobile computing as the technology they believe will deliver the most business value to their organizations, followed by clouding computing (33%), big data (14%) and social business (6%).
When it came to identifying the main challenges to realizing the potential of these new technologies, almost half of CFOs (49%) cited organizational shortcomings, such as lack of internal leadership or functional talent, as barriers to success. Lack of IT capabilities, from data quality of optimized business processes, was identified by 39% of CFOs as a barrier, with only 12% citing lack of company funding, indicating that CFOs are willing to loosen up their purse strings for technologies that can increase operating profits. When it came to deploying a technology at the top of most CFO wish lists – mobile business intelligence – CFOs cited the lack of a mobile device management policy as the biggest adoption barrier, followed by cultural challenges (33%), technology skills (22%), and security concerns (11%).
Big Data expert and MIT Sloan Professor Andrew McAfee believes that CFOs and finance organizations are natural owners of big data projects, because CFOs have the most insight into the business and collecting, synthesizing and interpreting data is second nature to the finance function. Yet when surveyed by Oracle on this subject, only 22% of CFOs agreed that they should own big data projects. The overwhelming majority – 77% - would prefer to be very involved by providing guidance to the business on the problems that big data can solve. Only 3% indicated that CFOs should have limited involvement and let IT take control. When it comes to the analytical talent needed to staff big data projects, only 27% of CFOs noted that they don’t have the talent in place now to make use of big data, with the remaining 73% saying that they had all, most, of some of the talent already in place to work on big data projects.
CFOs were also asked if their organizations make decisions based on data, or on intuition and experience. Only 13% responded that decision-making was heavily or mostly based on data, with the remainder (87%) relying on intuition and experience to varying degrees. In his keynote at the CFO Summit at the Executive Edge, McAfee urged CFOs to change this mix, as data-driven decision-making is increasingly linked to market success. Along similar lines, only 26% of CFOs surveyed identified business analytics as a source of definitive competitive advantage, while 67% of CFOs rely on business intelligence to serve as a reference point for management.
Cloud computing was ranked by CFOs surveyed by Oracle as having the second biggest impact on business value at their organizations, thanks to the financial flexibility and freedom that enterprises receive from using the cloud’s modular, pay-as-you-go approach to accessing the latest technology innovations. Almost 70% of CFOs said that they would consider moving to a cloud-based version of their core enterprise software, citing reasons such as the resource allocation flexibility that comes with avoiding large upfront investments in the early phases of an ERP deployment; the ability to avoid fixed capital investments during periods of corporate or economic uncertainty; and timely access to the latest software capabilities.
CFOs whose organizations had already adopted a cloud solution cited cost savings as the primary benefit (60%), followed by increased performance (43%), and more flexibility to adapt to changing business requirements (30%). Based on these benefits, CFOs are also becoming more actively involved in the selection and deployment of cloud services, with 68% of CFOs indicating that they or their CEOs were responsible for the acquisition or deployment of cloud services.
CFOs have been less involved in social computing decisions because of the perceived difficulty in accurately measuring the business value of social technology investments. For example, only 14% of CFOs surveyed by Oracle identified social media as a top priority for their organizations today, with 43% citing it as a medium priority and 41% as a low priority. CFOs ranked the ability to interact with consumers and recruit new employees as the top two benefits received from social investments (each ranked at 22%), followed by the ability to create brand awareness (20%), lower call center and customer service costs (16%), validate forecasts with consumer sentiment (11%), and improve engagement with investors and other stakeholders (10%). When presented with these potential benefits, 77% of CFOs indicated that they would take steps to discuss with their management teams how social technologies could positively impact their business strategies.
These CFO surveys and their findings are part of a year-long effort by Oracle to better understand CFO attitudes toward emerging technologies, with the goal of helping CFOs better understand the transformational impact of these technologies on their business success. To learn more, check out Oracle’s two-part webcast series with Financial Executives International entitled “What CFOs Want from IT”, or go to the Executive Insights page on Oracle C-Central for exclusive interviews and case studies on more insights and case studies on how CFOs are successfully exploiting exploit big data, business analytics, and mobile, cloud and social computing to unlock new growth.
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