CFOs lift lid on tech spend priorities

Simnikiwe Mzekandaba
By Simnikiwe Mzekandaba, IT in government editor
Johannesburg, 17 Apr 2024
Aucamp van der Schyff, head of finance at Syspro EMEA.
Aucamp van der Schyff, head of finance at Syspro EMEA.

Investment in business intelligence (BI) and customer relationship management (CRM) systems remain two of the top priorities for Africa’s financial leaders in manufacturing.

This is according to findings of the 2023 Syspro Manufacturing CFO Survey, presented yesterday during a virtual media roundtable.

Now in its third year, the survey was conducted in the third quarter of 2023, to assess the sentiment among CFOs within manufacturing sectors across Syspro regions, namely Africa, APAC (Australasia and Asia-Pacific), the US, Canada, the UK and Europe. Participants included financial leaders across SMEs and larger enterprises.

Aucamp van der Schyff, head of finance at Syspro EMEA, said African CFOs’ priorities differ from the rest of the world, with more saying they will continue to utilise technologies like BI, CRM and enterprise resource planning (ERP).

“With all the hurdles Africa faces, we’ve always found there’s so much optimism. When we surveyed when businesses in Africa expect to become profitable or to rebound, 91% said they would do so by mid-2024. This is the best of any of the regions surveyed.”

When asked about investing in technology, 65% of respondents revealed they would do so by purchasing it in cash, Van Der Schyff revealed. The other 35% said they would require comprehensive understanding of financial options and creative solutions for business.

In terms of where companies have invested or plan to invest when it comes to technology, 59% are looking towards investing in ERP software.

Other planned technology investments include cyber security and protecting company intellectual property, on-premises cloud data migration, managed services and outsourcing, smart technologies and robotics.

Hybrid CFO

According to the survey, there has been a shift to operational focus, in response to a series of external shocks, including post-pandemic supply chain disruptions, rising material costs, inflation and environmental challenges.

As a result, manufacturing CFOs are increasingly adopting a hybrid role, which means integrating strategic business knowledge with traditional financial expertise.

The research found that CFOs are increasingly expected to operationalise digital transformation (52%).

“This hybrid capability is essential for ensuring competitive advantage and requires a deep understanding of all business functions.”

Van Der Schyff explained: “The emergence of the hybrid CFO marks a pivotal shift towards a more integrated, strategic role, with a clear focus on leveraging digital transformation to secure operational resilience and drive sustainable growth.

“While their challenges are different to those of many other regions, the survey shows that African CFOs are embracing the hybrid CFO role and are rising to the task of digitising their organisations, while building operational insights. Eighty percent believe that a strategic outlook is vital.”

Marius Wessels, professional services manager at Syspro Africa, pointed out that since the first survey in 2020, the manufacturing sector has undergone a period of unprecedented changes, multiple overlapping and unexpected macro-level shocks.

“In the latest survey, the perception is that manufacturing CFOs are not post-crisis but somewhat between crises, and this is most likely to persist for the foreseeable future. As a result, the vast majority have recognised their role is evolving into one of a hybrid CFO.

“They have to have the skills, the data and toolsets required to provide the same degree of insights into the organisational and operational tasks.”

In pursuit of innovation

Another one of the survey’s key findings is that innovation remains undimmed, said Van Der Schyff. This is despite challenges, with CFOs prioritising investments in new equipment, inventory, expansion and digital transformation.

“Agility and adaptability are key to business survival. Respondents are continuing to invest in innovation, with diversification spend focused on expanding into new markets and new product lines.

“Investing in BI to support better clarity and information transparency across the business for better decision-making is a focus for 51% of those surveyed.”

In addition, the respondents indicated collaborating closely with the IT department and leadership as a key priority, with most of the CFOs surveyed (77%) either working closely with the CIO/IT team, overseeing and leading all IT projects or having the CIO/IT team reporting directly to them.

In Africa, the top five business priorities for manufacturing CFOs in 2024 are margins/profitable growth, cashflow, quality management, visibility into performance and operations, and governance and risk, the survey noted.