The silent costs of a broken tech stack
New research reveals that outdated tech stacks and undefined spend cultures hinder CFOs in their expanded roles.
New research reveals that outdated tech stacks and undefined spend cultures hinder CFOs in their expanded roles.
When the first steam engines revolutionized transportation in the 19th century, success wasn’t just about adopting new technology—it was about integrating it into existing systems like railways and ports to unlock its full potential.
Today’s CFOs face a similar challenge: navigating an increasingly digital world where fragmented tech stacks and undefined spend cultures hinder progress.
According to research by Payhawk, 93% of CFOs report their roles have expanded to include strategic priorities like sustainability and global expansion. Yet, only 35% believe their technology is up to the task, leaving a significant gap in their ability to drive growth.
Operational inefficiencies continue to challenge CFOs. Over half (51%) of finance leaders report limited data visibility, while 44% cite poor insights, and 42% note delays caused by manual processes.
For organizations with global ambitions, 42% say their tech stack limits their ability to expand internationally. Additionally, fragmented systems lead to inaccuracies, with 37% of CFOs experiencing issues with data consistency in the past year.
Beyond technology, the lack of defined frameworks for spend culture adds to these challenges. Spend culture—defined as the attitudes, behaviors, and practices that shape how an organization approaches spending—plays a pivotal role in organizational efficiency. Yet, only 31% of businesses report having a formalized spend culture policy in place, despite 41% actively working on defining one.
Fraud concerns (51%) and trust issues (44%) remain key barriers, underscoring the tension between providing teams autonomy and maintaining control.
The integration of AI into finance operations offers significant potential for addressing inefficiencies. According to the study, 87% of CFOs trust AI to manage some responsibilities, such as automating workflows and providing insights.
Nearly half (48%) of respondents have adopted AI in accounts payable processes, while 45% use it for accounts receivable, automating tasks like invoice approvals, payment reminders, and discrepancy detection.
AI tools are also being leveraged for strategic functions, such as scenario modeling and financial forecasting. However, 55% of CFOs cite inadequate training as the main barrier to wider AI adoption, followed by time constraints (48%) and cultural resistance (44%).
Despite these hurdles, CFOs are optimistic about AI’s role in enhancing rather than replacing teams, with 48% projecting a 12% increase in team size over the next five years.
Spending on CFO tools currently averages £125,000 annually for mid-to-large-sized businesses, with plans to increase this by 13% in the next year.
Over five years, investments are expected to grow by 18%, driven by the need to modernize tech stacks and address operational gaps. CFOs expect these investments to deliver a 14% increase in revenue, a 16% boost in CAGR, and a 20% improvement in operating cash flow.
CFOs are prioritizing systems that provide real-time insights, automate manual processes, and improve spend culture. Organizations that have established frameworks report clear benefits, including improved financial controls (49%), increased profitability (41%), and greater accountability (38%).
Although 85% of finance leaders acknowledge the importance of spend culture, many still lack the tools and policies to implement it effectively. Key barriers include:
While 4% of CFOs have no plans to develop a spend culture, 31% have a defined framework, 41% are actively working on one, and 25% intend to focus on this area within the next year.