It’s clear that organisations across the UK and Ireland (UK&I) have made exceptional progress when it comes to digital finance transformation. According to a new Workday report, almost half (49%) of all organisations across both countries have developed and deployed a digital finance strategy. 

This must be celebrated. The digital transformation of the finance function can provide businesses with a broad range of benefits including the reporting of non-financial data, improved procurement, streamlined financial close, consolidation, and enhanced statutory reporting. Amid the ongoing economic volatility faced around the world, the benefits unlocked by solid digital transformation strategy can provide a clear competitive advantage. 

Now for the bad news. While British and Irish businesses are taking great strides forward into digital finance, Workday’s research uncovered organisational challenges that hold back progress. And as a result of these challenges, only 33% of UK and Ireland’s finance and IT leaders would describe their organisation’s current finance technology as durable. This needs to be changed.  

The biggest threat: a lack of alignment   

For the full benefits of digital transformation to be realised, both finance and IT departments need to work in lockstep, with a clear and unified strategy, towards a common goal. However, this is rarely the case, and the lack of alignment is clear. 

According to the research, nearly half of senior finance and IT executives admit that there is a low degree of alignment and collaboration between these teams. What’s more, we found that just 34% of leaders in the UK and Ireland say that IT regularly advises on emerging technology and leading platforms for finance, while half of respondents say that finance and IT jointly select the analytics, reporting, and visualisation tools needed to make critical financial decisions. Alarmingly, just half (51%) report that finance always helps IT to understand the business strategy and metrics on which finance is measured.  

As a result, businesses run the risk of missing out on the benefits of modernised finance. It’s increasingly evident that a gap is emerging between the businesses which understand the value of nurturing strategic alignment, and those that have continued to take a deeply siloed approach.  

Time to bridge the gap 

If these findings are setting alarm bells ringing, the good news is that there’s never been a better time to act. The barrier to growth is surmountable. 44% of executives surveyed said that they are currently in the process of developing a digital finance strategy, meaning that they can ensure the gap between functions remains non-existent.  

 Here’s how to succeed: 

1. Adopt a skills-first mindset. We found that just under four in ten (39%) of leaders believe that their organisation has the skills required to keep pace with emerging digital finance technology. This means swathes of organisations are falling behind, and a growing skills gap is emerging. By hiring finance professionals with a good grasp of digital, leaders can help to address this growing issue. Businesses can also look to upskill existing finance team members in digital technologies. The result is increased understanding between IT and finance departments, where both understand the same language and benefit from increased collaboration. 

2. Prioritise data strategy. Just under half (49%) of finance and IT leaders in the UK and Ireland say that their organisation has a single, unified view of all financial, operational, and people data. This provides a blinkered, inefficient view of business performance, and hampers effective collaboration between departments. By adopting technology platforms that can enable seamless and easily accessible data, organisations can bridge the gap not only between IT and finance, but other departments too. 

3. Bring the CIO to the board table. Currently, 44% of UK&I organisations report that the CIO does not join critical finance meetings — even when technology is essential to solving a business challenge. This must be addressed. By extending the boardroom table and nurturing conversations between the CIO and CFO, businesses can ensure that functional alignment starts at the highest levels. 

Businesses will only succeed when the entire workforce can coalesce around a shared common vision and work together towards it. By openly sharing (and building on) this vision, both the finance and IT functions can better understand how their priorities align with the wider organisation’s success. 

Amid ongoing economic uncertainty, finance leaders and their teams need the transformative benefits of robust digital strategies now more than ever before. The lack of alignment between finance and IT departments must be addressed and bridged in order to charter the best route through challenging economic headwinds. Doing so could just be the difference between success and failure.