2020 Finance Trends Survey: Data Security and Data Analytics Becoming Top Finance Priorities in the COVID Era

Hong Kong, 25 November, 2020 – As expected, COVID-19 has significantly disrupted finance organisations in numerous areas, showing that this function has not escaped unscathed. In the face of extreme pressure, minimising risk and protecting assets are top-of-mind in what CFOs and finance leaders care about. The newly- released 2020 Finance Trends Survey conducted by global consulting firm, Protiviti revealed that finance leaders picked data security and privacy as their top overall priorities, followed by data analysis enhancement globally as well as across APAC markets.

Top priorities for global and Hong Kong leaders

As per the latest survey findings, the top three priorities related to the finance function for the global leaders are data privacy and security (80%), data analytics (78%) and changing demands and expectations of internal customers (74%). The technology-heavy makeup of CFOs’ top priorities reflects an understanding that finance organisations on the leading digital edge were able to respond to COVID disruptions with the greatest speed, efficacy and resiliency. These priorities also underscore the crucial nature of a truly digital finance organisation girded by next generation technologies, workflows and collaborations.

“The data reveals that data security and privacy will remain as a top priority for CFOs and finance leaders to address over the next 12 months. As a result, it is crucial for finance executives to focus their finance expertise on how data security and privacy spending is benchmarked, how those investments are allocated, and how cyber risks are quantified in dollar amounts and articulated in business terms.” comments Adam Johnston, Country Leader and Managing Director. “With these priorities, it will be critical for CFOs and finance leaders to ensure the finance organisation has the right talent and skills in place to support, both in-house and with external experts and outsourced providers.”

While looking specifically at Hong Kong market, it is interesting to reveal that Hong Kong leaders have different perspectives. They are prioritising competitive intelligence (55%) over enhanced data analytics (54%) and process improvement (54%). “Competitive intelligence is important for today’s finance organisations because it helps leaders to understand competitors and the market so that accurate judgments can be made. The key is to identify challenges, advantages and white spaces to build a strategy that creates competitive differentiation.” Adam adds.

COVID upended finance operations

As the COVID-19 pandemic continues to evolve, finance leaders point to several ways the pandemic will drive more fundamental, longer-term changes to finance operations. Adam Johnston says: “The many effects of the pandemic hindered the preparation of timely financial statements, compelled the reforecasting of finance plans, impeded the ability of many third parties to meet their service level agreements, sparked supply chain upheavals, and spurred CFOs to fundamentally rethink their staffing approaches.” Over 80% of global CFOs and finance leaders think their organisations’ ability has been impacted by COVID-19. Thus, there has never been a more pressing need for organisations and leaders to rethink and reconfigure their businesses for a changing world.

Meanwhile, finance leaders recognise that numerous risk management activities need to be reconfigured in response to the shift to remote working and other fundamental COVID-related changes. Over 90% of global CFOs and finance leaders give themselves relatively high marks for being well prepared to mobilise to a remote working model, which shows that strong leaders are always able to react quickly to different situations or crises. Over 73% of finance leaders also believe that they will be likely to work remotely on a more frequent basis in the future. In addition, given that offshore business process outsourcing and shared services capabilities have been impacted substantially by COVID-19, finance organisations may look more closely at solutions such as robotic process automation, onshore managed services providers and insourcing, among other approaches.

As such, CFOs are making adjustments in their workforce accordingly. Changing demand and expectation of internal customers, enhanced data analytics, cloud-based applications that support finance, security and privacy of data, data visualisation are some the top areas where maximum number of global and APAC leaders have increased the workforce percentage. In Hong Kong, particularly, changing demand and expectation of internal customers is one area where maximum number (43%) of leaders have increased the workforce.

The new finance labour model – The need for speed

COVID-19 has sparked the largest and swiftest shift to a remote working model that most businesses have ever experienced, forcing many finance teams to adjust to mobile technologies, new workflows and virtual collaborations while adhering to reporting deadlines and internal control obligations that had not changed. While roughly one-third of respondents are reducing staff sizes across most finance areas, a surprisingly high percentage of CFOs are increasing the size of the team focusing on changing demands of internal customers, data analytics enhancements, and cloud-based finance applications.

Finance leaders who manage a diverse talent pool of full-time employees, contract and temporary workers, expert external consultants, and managed services and outsourcing providers have been able to respond to external disruptions with greater speed and agility, and with fewer compromises to core finance processes. In fact, for financial planning and analysis, 18% of finance organisations rely on managed service providers and 29% leverage staff augmentation to support these activities. The use of external parties is particularly commonplace within accounting operations, tax, risk management, and strategic finance.

Adam concludes: “With data security and privacy likely to remain top concerns for finance leaders in the foreseeable future, this suggests that this group are committed to ongoing finance transformation and equipping their departments with the foundational building blocks needed to operate digitally, flexibly and resiliently to support their organisations and to strengthen organisational agility and resilience. In addition, finance leaders are calling on their third party partners with greater frequency for a highly agile and flexible workforce and access to needed expertise in the face of COVID-driven shelter-in- place orders, supply chain disruptions and greater overall resource efficiency, among other factors, as they seek to develop and employ their ‘future labour model’.”