SYSPRO, a global provider of ERP software, has today released its third annual Global CFO Survey, which reveals that the role of the manufacturing chief financial officer (CFO) has seen a strategic inward focus aimed at bolstering operational resilience and efficiency in the wake of some unprecedented macro-economic shocks.
The study, which was conducted from July to September 2023 and commissioned by SYSPRO, assessed the sentiment among CFOs within manufacturing sectors across Europe, Middle East and Africa (EMEA), the Americas as well as Asia Pacific (APAC). The participants included financial leaders across both SMEs and larger enterprises, with the results reflecting the insights of a wide selection of decision-makers in the manufacturing sector.
Key insights from SYSPRO’s Global CFO Survey:
The study revealed that manufacturing CFOs believe we are not post-crisis but rather between crises and that this is a situation that is likely to persist. As a result, the vast majority have recognised that their role is evolving into one of a ‘hybrid CFO’.
Shift to operational focus: In response to a series of external shocks, including post-pandemic supply chain disruptions, rising material costs, inflation and environmental challenges, manufacturing CFOs are increasingly adopting a hybrid role. This approach emphasises operational efficiencies to mitigate future economic shocks.
The research demonstrated that CFOs are increasingly expected to operationalise digital transformation (52%), which again points towards a greater involvement in operational areas.
The rise of the hybrid CFO: The survey highlights the evolving role of CFOs, who now integrate strategic business knowledge with traditional financial expertise. This hybrid capability is essential for ensuring competitive advantage and requires a deep understanding of all business functions.
Survey responses from all regions, including Africa, showed a high degree of consistency in terms of identifying the core skills and competencies required for a modern manufacturing CFO. The research showed that 80% believed that strategic business knowledge is vital for CFOs to ensure their businesses remain competitive.
Fiscal conservatism and digital transformation: Amid ongoing economic uncertainties, the survey reveals a trend towards fiscal conservatism, paired with a commitment to digital transformation. This strategy aims to manage risks while fostering sustainable business growth.
Sixty-three percent said they have opted for a more conservative business strategy considering the current world economy, and over half of respondents (57%) anticipate a return to profitability by the end of 2023, while an additional 24% expect to reach this point by mid-2024.
The majority of CFOs (85%) are either part of or lead the digital transformation project team demonstrating their commitment to their ongoing digital transformation journey. However, for African CFOs, fiscal conservatism is influencing their plans for digital transformation, with 65% of respondents planning to fund digitisation initiatives using cash, and 60% identifying cost efficiencies as the primary benefit of their digital transformation investments.
Internal resilience as a strategic priority: Building internal resilience through cost efficiencies and improved margins is identified as a key strategy for countering external threats. Almost 100% of respondents reported that pandemic-induced business modifications have enhanced their resilience against future disruptions.
Continued investment in innovation: Despite challenges, CFOs are prioritising investments in new equipment, inventory, expansion and digital transformation. Investing in business intelligence to support better clarity and information transparency across the business for better decision-making is a focus for 51% of those surveyed. Respondents also show a clear leaning towards investing in ERP as a means of delivering operational efficiencies.
Collaborating closely with the IT department and leadership has emerged as a key priority, with most of the CFOs surveyed (77%) either working closely with the CIO/IT team, overseeing and leading all IT projects or having the CIO/IT team reporting directly to them.
In Africa specifically, the top five business priorities for manufacturing CFOs in 2024 are:
- Margins/profitable growth
- Cashflow
- Quality management
- Visibility into performance and operations
- Governance and risk
“Our Global CFO Survey highlights the adaptive strategies and priorities of manufacturing CFOs in navigating complex and volatile economic landscapes. The emergence of the hybrid CFO marks a pivotal shift towards a more integrated, strategic role, with a clear focus on leveraging digital transformation to secure operational resilience and drive sustainable growth,” said Aucamp van der Schyff, Head of Finance at SYSPRO EMEA.
“While their challenges are different to those of many other regions, the survey shows that African CFOs are embracing the hybrid CFO role and are rising to the task of digitising their organisations while building operational insights. Eighty percent believe that a strategic outlook is vital,” added Van der Schyff.
For more information on SYSPRO ERP Software, please visit https://za.syspro.com/.
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