Study calls on companies to re-examine traditional data collection tools and processes
NEW YORK; Nov. 30, 2004—More than half of corporate financial officers say that their biggest challenge is the amount of time it takes to collect appropriate data for accurate forecasting, according to results of a survey released today by Accenture (NYSE: ACN).
The study, designed to identify the issues and trends that affect decisions within the corporate finance function, involved interviews with 200 executives in the United States and United Kingdom responsible for the financial, treasury and cash management decisions of their organizations, which span more than a dozen industries.
When asked to select the area that poses the biggest problem for forecasting, the greatest number of respondents—51 percent—selected “time required to collect data.” The next two biggest problems identified were “getting agreement on objectives and what needs to be done” and “inadequate data capture tools,” cited by 45 percent and 44 percent of respondents, respectively.
Similarly, when asked to select from a list of elements of the budget and forecasting process they would most want to change or improve over the next 12 months, 58 percent of respondents cited “time it takes to collect data” among their top three concerns. “Data gathering tools” and “Process by which data is collected” were the next-most-selected items, each with 48 percent of respondents citing each among their top three concerns.
“While companies are now able to generate more data than ever before, thanks to advances in technology, it’s just not getting to the right people quickly enough,” said Michael Sutcliff, global managing partner of the Accenture Finance & Performance Management service line. “The problem is of particular concern for CFOs, who are increasingly dependent on accurate data to generate financial management strategies that create long-term shareholder value.”
Sutcliff believes that the survey findings bring into question whether fundamental processes and tools used to collect and analyze data should be re-examined. “Substantial investments have been thrown at the finance function to facilitate more accurate data capture and improve CFO accountability, yet most companies are not achieving their goals for the finance function,” said Sutcliff. “Incomplete data, lack of consensus around forecasting objectives and outdated collection tools are not just problems isolated to the finance function anymore—these are issues that every area of an organization needs to address.”
While finance executives in the United States and United Kingdom were mostly in agreement about forecasting problems and improvements, the survey identified significant differences between respondents in the two geographies regarding how their organizations were affected during uncertain economic times. For instance:
Nearly four times the number of U.K. finance executives said their businesses had been affected significantly by volatile economic times than did their U.S. counterparts—15 percent versus 4 percent.
- U.K. finance executives were at least twice as likely as their U.S. counterparts to have postponed or eliminated software upgrades such as CRM and reporting tools (22 percent versus 10 percent), hardware upgrades (22 percent vs. 10 percent) and additional enterprise resource planning rollouts (18 percent vs. 6 percent).
- Twice as many U.S. finance executives said new compliance requirements have affected their company’s success than did their U.K. counter parts—44 percent vs. 22 percent.
About the CFO Survey
International Communications Research, on behalf of Accenture, conducted an phone survey July—August 2004 of 200 finance executives in the United States and United Kingdom from more than a dozen industries. Respondents, split evenly between the two countries, held senior-level finance positions at their organizations, including CFO, Treasurer and Financial Director, among others. The majority of respondents work for companies with more than US$[1.1] billion in annual revenues.
Accenture is a global management consulting, technology services and outsourcing company. Committed to delivering innovation, Accenture collaborates with its clients to help them become high-performance businesses and governments. With deep industry and business process expertise, broad global resources and a proven track record, Accenture can mobilize the right people, skills and technologies to help clients improve their performance. With more than 100,000 people in 48 countries, the company generated net revenues of US$13.67 billion for the fiscal year ended Aug. 31, 2004. Its home page is www.accenture.com.