The Hackett Group: Finance Leaders See Unprecedented Digital Transformation Opportunity, But Struggle with Execution
March 30 2017 - 9:30AM
Business Wire
While finance leaders fully recognize the unprecedented
opportunity to drive performance improvement via digital
transformation, most lack a comprehensive strategy and are not
clear where or how to deploy digital technology to their best
advantage, according to new Key Issues research from The Hackett
Group, Inc. (NASDAQ: HCKT). In addition, The Hackett Group found
that significant skills and competency gaps are preventing finance
organizations from taking full advantage of digital
transformation.
Digital transformation will result in dramatic changes in the
business, as well as the finance service delivery model itself,
with both moving forward at unprecedented speed, according to the
study. The Hackett Group’s research warns that finance
organizations that fail to meet the challenge of closing the
digital transformation skills and competencies gaps will quickly
fall behind in performance and put execution of the enterprise
digital strategy at risk, potentially compromising their ability to
compete.
A complimentary version of the research is available for
download, following registration, at this link:
http://www.thehackettgroup.com/research/2017/social-media/key17fn/.
“This study shows an emerging problem within finance
organizations. They recognize the tremendous potential to change
the way they operate. But in this early stage of the digital
revolution they are struggling to determine how to move forward,
and how to truly attain the greatest benefit,” said The Hackett
Group Senior Research Director Nilly Essaides. “There’s a
significant opportunity for companies that can figure this out and
make the necessary changes to technology, processes and
people.”
The Hackett Group’s research showed that more than 90 percent of
finance organizations believe that digital transformation will
fundamentally change the way finance services are delivered,
including the way it services internal and external customers,
suppliers and partners, as well as the talent and leadership roles
it must develop. Adoption of digital technologies in finance --
including cloud-based applications, advanced analytics, robotic
process automation (RPA), mobile computing, and big data – is
expected to grow dramatically in the next two to three years, the
study found. Yet only 44 percent of finance organizations have a
formal digital strategy and only 35 percent have the right caliber
talent. What’s more worrisome, only 15 percent are planning to
revise job profiles or competency models this year to address
digital business transformation needs.
Finance organizations expect to remain heavily focused on
reducing costs and headcount in 2017, as companies move from
defensive postures to more aggressive growth through innovation.
Despite projected revenue growth of 4.1 percent, finance
organizations expect their headcount will fall by 4.4 percent and
budgets by 3.8 percent, on top of declines of 3.3 percent in
headcount 4.0 percent in budgets last year. According to The
Hackett Group’s research, digital transformation is likely to
provide significant support for this effort to improve efficiency.
Many emerging technologies offer opportunities to improve
productivity and quality levels beyond what can be achieved with
traditional ERP-based business process automation.
The research also found very high levels of exposure to a broad
range of business risks and sharp projected increases in these same
risks over the next two years. The top four areas of projected risk
– cyber-security, intensified competition, disruptive innovation
and access to critical talent – are all related to structural
transformation of the business, which in today’s world is
inevitably digital in nature and driven by technology
innovation.
While adoption levels of emerging digital technologies in
finance are low at present, they are projected to grow dramatically
over the next two to three years, according to The Hackett Group’s
research. Mainstream adoption of cloud-based
(software-as-a-service) applications is expected to grow by more
than 2.5x, to nearly 40 percent, in the next two to three years.
Mainstream adoption of advanced analytics is expected to grow by
more than 4x, to 35 percent of all finance organizations. The
Hackett Group’s research found similar projected sharp increases in
adoption of several other key digital technology areas, including
robotic process automation and mobile computing.
Advanced analytical and business intelligence capabilities, key
elements of digital business transformation, are particularly
critical for finance organizations to improve, as they enable
finance to more effectively support enterprise strategy and provide
the business with better and faster insight. Improving analytics
was listed as one of the top enterprise-level finance goals by
companies in the study.
“To maximize its value contribution to the business, finance’s
priorities must be aligned with enterprise strategy and growth
objectives, which are increasingly being shaped by technology-based
innovation,” said The Hackett Group Finance Transformation Practice
Principal Richard Cardillo. “Finance leaders must develop a sense
of urgency and seize this opportunity. The potential is clear -
digital transformation can enable entirely new business models,
allowing companies to leapfrog the competition. Finance leaders
must develop digital transformation strategies that leverage
emerging technologies and align with their company’s overall
approach, and develop a structured program to hire and/or develop
the talent they need to succeed.”
The Hackett Group’s 2017 Finance Key Issues research, “Finance’s
Top Four Strategic Priorities in the Coming Year” is based on
results gathered from executives from more than 180 large companies
in the US and abroad, most with annual revenue of $1 billion or
greater.
About The Hackett Group
The Hackett Group (NASDAQ:HCKT) is an intellectual
property-based strategic consultancy and leading
enterprise benchmarking and best practices implementation
firm to global companies. Services include business
transformation, enterprise performance
management, working capital management, and global
business services. The Hackett Group also provides dedicated
expertise in business strategy, operations, finance, human capital
management, strategic sourcing, procurement, and information
technology, including its award-winning Oracle EPM and SAP
practices.
The Hackett Group has completed more than 11,000 benchmarking
studies with major corporations and government agencies, including
93% of the Dow Jones Industrials, 86% of the Fortune 100, 87% of
the DAX 30 and 52% of the FTSE 100. These studies drive its Best
Practice Intelligence Center™ which includes the firm's
benchmarking metrics, best practices repository, and best practice
configuration guides and process flows, which enable The Hackett
Group’s clients and partners to achieve world-class
performance.
More information on The Hackett Group is available at:
www.thehackettgroup.com, info@thehackettgroup.com, or by calling
(770) 225-3600.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170330005193/en/
The Hackett GroupGary Baker, 917-796-2391Global
Communications Directorgbaker@thehackettgroup.com
Hackett (NASDAQ:HCKT)
Historical Stock Chart
From Jun 2024 to Jul 2024
Hackett (NASDAQ:HCKT)
Historical Stock Chart
From Jul 2023 to Jul 2024