CHICAGO–(BUSINESS WIRE)–According to the 2022 Financial Maturity Study by Paro, a Chicago-based startup disrupting the way companies access on-demand financial expertise, 93% of senior finance executives say investing in finance and accounting is essential to sustain the growth of the business. However, only 24% of executives say they invest in these functions to drive growth. Instead, they say they focus their resources on efficiency, which translates into potentially limited opportunities for expansion.
Efficiency leads to investment reasons
The study found that senior finance executives view finance and accounting as a critical component of their company’s long-term success. When asked to select the function that offered their company the best opportunity to develop core skills, a majority (52%) chose finance. It is closely followed by operations and people management at 49% and accounting at 46%.
However, 38% of senior finance executives say that when their company invests in resources for the finance and accounting team, they focus on greater efficiency. 33% said investments focus on fundraising, and 5% say investments focus on recovery efforts, such as recovery strategies or tackling the effects of macroeconomic situations.
“Finance and accounting is a critical growth center for businesses, and businesses that overemphasize efficiency without proper resources to leverage it will hinder their own growth,” said Anita Samojednik, CEO of Paro. . “As businesses consider current recessionary concerns, those that prioritize a flexible model that can drive both efficiency and growth will be best positioned to meet economic challenges and create long-term competitive advantages. .”
Low bandwidth, lack of strategic direction and profitability present challenges
Senior finance executives say lack of bandwidth to seize new opportunities is the most common challenge they face (38%). This is followed closely by the response to investor requests (36%) and the lack of strategic advice for decision-making (34%). Additionally, 60% of senior finance executives also say profitability is a financial challenge facing their company.
To meet the challenges, financial service providers are often seen as a solution. When evaluating these vendors, the most important criteria include having a system that provides an innovative technology platform (36%), providing data and insights to help make decisions (34 %), help plan and optimize next steps for the business (34%), and provide customized solutions to a business problem (32%).
Recruitment still seen as a barrier to growth
Many senior finance executives (39%) cited staffing, hiring and retention as the biggest barrier to business growth. This may explain why 79% are open to increasing their company’s headcount to take advantage of spikes or expand solution offerings. However, only a small fraction (16%) already do so.
A majority (53%) see flexible staffing and resourcing as an effective strategy to protect their business from threats of market volatility. In fact, 69% of senior finance executives say their company relies on split resources for their finance and accounting teams, while only 19% say their company’s finance and accounting team is made up entirely of dedicated resources. full time.
“It’s clear that senior finance executives recognize the importance of flexible operating models to capitalize on market opportunities and hedge against volatility,” Samojednik said. “However, there is a clear activation gap between the desire to do so and the ability to leverage and deploy an agile talent management strategy that can enable them to develop their potential.”
The Paro 2022 Financial Maturity Study was conducted by Wakefield Research (www.wakefieldresearch.com) among 500 senior finance executives in the United States between June 6 and June 15, 2022, using an email invitation and an online survey.
Paro is an AI-powered marketplace that provides finance and accounting solutions to businesses through a combination of expert fractional talent, data-driven tools, and guiding insights. By harnessing the power of people and technology, our growth platform offers flexible options, from transaction processing support to business development and funding strategy, to solve key business challenges and drive the growth. The result allows companies and experts to go beyond their highest goals.
Learn more about Paro.ai.