The Hackett Group’s Finance Key Issues
Research Identifies Priorities and Challenges for 2022
Digital transformation is now the top priority for finance in
2022, according to new Finance Key Issues research from The Hackett
Group, Inc. (NASDAQ: HCKT). But finance executives’ confidence in
their ability to meet business expectations is low, in part due to
technology and process complexity and skills deficits. Rising
finance workload combined with declining budgets and headcount will
also create productivity and efficiency gaps that are likely to
limit the ability of finance to meet its 2022 objectives.
The full research, “The Finance Agenda: 2022 Key Issues,” is
available on a complimentary basis, with registration, from The
Hackett Group® at this link:
http://go.poweredbyhackett.com/22finkey2201sm. Key findings from
the research include:
Inflation a Major Concern – With
inflation accelerating to 7.9% in February 2022 and projected to
persist into the foreseeable future, many companies were caught by
surprise and are now scrambling to understand the impact on their
business, and develop responses to manage the risk. In The Hackett
Group’s Finance Key Issues Study, conducted in Q4 of 2021, 31% of
respondents cited inflation as a major concern and another 53%
cited it as a moderate concern. The current inflationary
environment was triggered by a confluence of factors that can be
traced back to the pandemic: pent up demand, supply chain
disruption, labor market disruption, loose monetary policy and
fiscal stimulus. The unfolding conflict in Ukraine has added
additional uncertainty to business conditions and could accelerate
inflation through higher energy and commodity prices. Organizations
that are agile and well-equipped to respond to the disruption can
turn their advantage into real economic gain. That will require
good analysis and coordination.
Digital Transformation Now the Top
Priority – Digital transformation has now become finance’s top
priority, with many of the function’s top priorities dependent on
the ability to accelerate it. But executives’ confidence in the
ability to meet business expectations is low, with specific cited
challenges that include technology and process complexity, skills
deficiencies, and organizational resistance to change. Finance
executives are placing emphasis on improving analytical, modeling
and reporting capabilities with 86% of organizations citing this as
a critical or high priority. Additionally, finance must be prepared
to invest in technologies, such as cloud, robotic process
automation, analytics and others to reduce cost and create new
capabilities. About two-thirds of all finance organizations are
also expanding process automation, while over one-half have an
initiative to expand the use of self-service tools.
Budgets and Staffing Continue to Tighten
– Finance organizations face continued emphasis on greater cost
efficiency in 2022, with workload expected to increase by nearly 5%
while budgets and head counts are declining by 0.7% and 0.6%,
respectively, the study found. Finance is counting on technology
and service delivery model improvements, including centers of
excellence and global business services, to bridge the productivity
and efficiency gaps. Overall, cost reduction moved down the
priority list by four spots to sixth place in 2022, as companies
have navigated the pandemic and extracted savings. But it remains a
major priority, and may rebound in importance if inflation
continues to accelerate in 2022.
Three Critical Areas for Development –
In three of the top 10 priority areas, there are significant gaps
between their importance and finance’s ability to meet
expectations. The three priorities with the largest gaps are:
accelerating finance digital transformation; up skilling and
retaining finance talent in the face of the “Great Resignation”;
and enabling finance agility by fostering a nimble mindset.
Talent/Upskilling on the Rise – In the
face of the “Great Resignation,” finance organizations are thinking
critically about building the next-generation workforce. If finance
is to achieve its goal of becoming a more effective strategic
advisor to the business, it must acquire or develop new skills in
areas, such as teamwork and collaboration, and evolve business and
industry acumen. The goal of aligning skills and talent with
evolving business needs moved up several spots in the 2022 Finance
Key Issues Study. Nearly half of all companies have plans to
acquire new skills and talent – significantly more than other
planned workforce initiatives. Given the challenges that companies
are experiencing in finding candidates with the right skills and at
the right cost, there will also be a premium on retaining existing
employees. Pandemic-triggered disruption and accelerated digital
transformation are also sparking a reevaluation of the finance
operating model, with 30% of the finance workforce expected to work
from home by the end of 2022, and another 52% relying on a hybrid
arrangement.
Strengthening Business Partnering –
Acting as a strategic advisor to the business is now the number two
priority for finance, requiring an emphasis on business partnering,
the research found. Nearly 60% of finance organizations have a 2022
initiative designed to improve the interaction model between
finance and business stakeholders, making it one of the most
prevalent finance initiatives of any type. Between one-third and
one-half of finance organizations also have initiatives aimed at
bolstering individual business partnering capabilities, and nearly
one-third plan to dedicate full-time staff to business partnering.
The focus on business partnering will be critical to achieving
other finance priorities, including optimizing working capital, and
enhancing control and compliance capabilities. It is also critical
for managing inflation risk.
ESG Accounting a Growing Concern – The
environmental, social and governance (ESG) agenda is rapidly
becoming a strategic priority for many companies, and this has
far-reaching implications for finance organizations. The research
found that while more than 60% rank the need to develop and support
ESG strategy as important, only 32% rate their ability to meet
business needs in this area as “high.” As reporting and disclosure
standards continue to emerge, finance must evaluate how prepared it
is to support future requirements from a people, process and
technology perspective. Finance also has an important role to play
in helping their businesses understand the financial implications
associated with ESG-related programs and initiatives. Finance
organizations must make their expertise in financial planning and
analysis (FP&A), forecasting, compliance, and statutory and
management reporting available to the organization in order to
support the ESG strategy and execution of operational plans.
The Hackett Group’s 2022 Key Issues research is based on results
gathered from more than 250 executives in IT, finance, HR,
procurement, supply chain, and global business services at a global
set of midsized and large enterprises.
About The Hackett Group
The Hackett Group, Inc. (NASDAQ: HCKT) is an intellectual
property-based strategic consultancy and leading enterprise
benchmarking firm to global companies, offering digital
transformation, including implementation of leading enterprise
cloud applications, workflow automation and analytics that enable
Digital World Class™ performance.
Drawing from our unparalleled IP from nearly 20,000 benchmark
studies with the world’s leading businesses – including 97% of the
Dow Jones Industrials, 94% of the Fortune 100, 70% of the DAX 30
and 51% of the FTSE 100 – captured through our leading benchmarking
platform, Quantum Leap® and our Digital Transformation Platform
(DTP), we accelerate best-practice implementations.
More information on The Hackett Group is available at:
www.thehackettgroup.com, info@thehackettgroup.com, or by calling
(770) 225-3600.
The Hackett Group, quadrant logo, World Class Defined and
Enabled, and Quantum Leap are the registered marks of The Hackett
Group.
Cautionary Statement Regarding “Forward-Looking”
Statements
This release contains “forward-looking” statements within the
meaning of Section 27A of the Securities Act of 1933 as amended and
Section 21E of the Securities Exchange Act of 1934, as amended.
Statements including without limitation, words such as “expects,”
“anticipates,” “intends,” “plans,” “believes,” seeks,” “estimates,”
or other similar phrases or variations of such words or similar
expressions indicating, present or future anticipated or expected
occurrences or outcomes are intended to identify such
forward-looking statements. Forward-looking statements are not
statements of historical fact and involve known and unknown risks,
uncertainties and other factors that may cause the Company’s actual
results, performance or achievements to be materially different
from the results, performance or achievements expressed or implied
by the forward-looking statements. Factors that may impact such
forward-looking statements include without limitation, the ability
of The Hackett Group to effectively market its digital
transformation and other consulting services, competition from
other consulting and technology companies that may have or develop
in the future, similar offerings, the commercial viability of The
Hackett Group and its services as well as other risk detailed in
The Hackett Group’s reports filed with the United States Securities
and Exchange Commission. The Hackett Group does not undertake any
duty to update this release or any forward-looking statements
contained herein.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220505005707/en/
Gary Baker, Global Communications Director - (917) 796-2391 or
gbaker@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