The Controllers Council and Sage recently released the results of the 2023 Controller/CFO Sentiment Study, which surveyed 300 North American CFOs and controllers.
The study uncovered how macro-economic trends are shaping corporate finance planning, strategy, priorities and outlooks. Among the findings, the majority of respondents expect topline revenue to increase in 2023, but very few plan to make large investments in headcount for their financial operations to manage such growth.
Let’s look at the key findings:
Nearly two-thirds of CFOs and controllers expect increased revenue in 2023
The study found that 61% of respondents expect increased revenue in 2023, with 44% saying they expect improved financial performance this year.
Building on the lofty expectations, 48% of respondents expect increased profits in 2023, while only 17% expect decreased performance.
“This is a pretty bullish group of people,” Mark Floisand, EVP of Global Product Marketing at Sage, commented during a webinar presenting the findings. “The optimism that exists in the smaller end of our economy is reflected in that revenue number.”
Fewer than 20% of CFOs plan to increase spending and budgets in 2023
Despite high expectations, the study found that only 18% of respondents said they plan to increase spending and budgets in 2023. Forty-seven percent said they will maintain spending and budgets and 33% plan to reduce them.
Floisand commented: “There’s a tension in here. There are high expectations to capitalize on growth, to strike while the iron is hot, to gain market share and fly in the face of all the negative headlines. And yet to do so with a much lower investment in running the business. … Improving automation and figuring out how to equip folks with better productivity tools goes a long way to bridging that gap.”
Honing in on human capital, 69% of respondents said they will keep the same headcount in their accounting/finance department, and 7% said they will decrease accounting/finance headcount.
This is where Floisand said technology can help finance teams, especially controllers in leadership roles, meet the goals of a high-growth business.
“What we see in these numbers is the opportunity to help equip organizations with the kind of capabilities that enable them to manage those expectations and bridge the controlling gaps,” Floisand said. “It’s not as though everyone’s got the luxury of being able to go and triple their finance teams. They don’t.
“But the expectation is for those finance teams to support very high expectations and growth. So, there’s this balance and expectation of how do you tool up your finance and control teams to support the expectations of the business.”
What does this CFO survey tell us?
According to the panel, the study highlights the need to enable finance professionals to be impactful, satisfied employees who drive results. If companies don’t plan to increase headcount, they have to get the most out of the workforce they have.
“What we have to do is help folks in this profession recognize that there are tools that enable them to take advantage of their skills and liberate them and have them work on more meaningful, challenging projects and programs … not the administrative stuff that can be automated,” Floisand said. “You have to make it compelling.”
According to the survey, many organizations recognize the need for finance innovations as 36% of respondents plan to increase investment in back-office operations including accounts payable (AP) and accounts receivable (AR), which Floisand called a “significant number.”
“I could interpret this as having an intrinsic belief that to grow you need to invest in technology to fuel it – not necessarily just keep piling on headcount because that doesn’t scale very well,” according to Floisand. “It makes complete sense that notion of automating AP, automating AR and taking away some of the time that’s consumed in manual data entry for every piece of documentation that flows in and out of an AP or AR department. That’s all productivity and efficiency gains, but is only enabled by investing in those systems.”
You can watch the full panel discussion based on the 2023 Controller/CFO Sentiment Study here.