CFOs face execution gap as accountability outpaces control

RGP has published research showing a gap between the accountability Chief Financial Officers carry for business strategy and the control they have over execution. The survey found that 96% of finance leaders report high accountability for enterprise strategy.

The study, based on 400 Chief Financial Officers and equivalent finance leaders at organisations with annual revenue of at least USD $250 million, found that only 55% said they had high control over executing that strategy. Nearly half, 49%, said their transformation agenda exceeded their organisation's ability to deliver it.

The findings point to a tension in large companies: finance chiefs are taking on broader responsibility for enterprise performance while still lacking direct authority over the teams, systems and processes needed to carry out major initiatives. Only 31% of respondents said at least three-quarters of major strategic initiatives had delivered their intended business results on time over the past three years.

Even so, confidence in near-term trading remained relatively strong. Some 89% of respondents were positive about their organisations' financial outlook for the next 12 months, suggesting optimism about business conditions is coexisting with concern over internal delivery constraints.

Execution gap

The survey suggests governance structure is a key dividing line between companies that complete strategic programmes successfully and those that do not. Just 13% of respondents said their organisations manage major initiatives through enterprise-wide governance with a single point of accountability.

Among those organisations, 58% said at least three-quarters of initiatives delivered intended results on time, compared with 14% at organisations described as operating in silos.

Organisational alignment also emerged as a recurring problem. Nearly 89% of respondents said misalignment slows execution at least sometimes, while 43% identified execution or organisational factors as the biggest constraint on enterprise value over the next three years. That compared with 11% who cited technology, data or AI maturity and 7% who pointed to access to capital.

In growth initiatives, the accountability gap was wider than for enterprise strategy. While 89% reported high accountability, only 38% said they had high control over execution. On AI adoption, 64% said they carried high accountability, but only 18% reported high control.

Across all enterprise areas measured, 88% said they faced high accountability without matching control in at least one area, and 69% said that imbalance applied across three or more areas.

Scott Rottmann, President of Consulting Services at RGP, said the changing role of the finance leader has created pressure to deliver outcomes without equivalent decision-making authority.

"CFOs have spent the past several years earning a bigger seat at the table. Now, they're being asked to deliver on the decisions made there," Rottmann said.

"But greater accountability doesn't always come with greater authority. The next scarce resource is the organizational capacity to turn investments into results. Companies have learned how to allocate capital, but they haven't learned how to allocate change. That's the gap CFOs are now being asked to close," he added.

AI returns

The research also highlighted a disconnect between expectations for AI and the returns seen so far. While 52% of respondents said they are already seeing positive AI returns, only 10% described those returns as significant.

Expectations for the next two years were much higher, with 54% saying they expect significant positive returns within 24 months. At the same time, 37% identified AI and automation as an area where organisations invest too much relative to the value created.

The barriers to generating value from AI were mostly practical rather than financial. The most commonly cited obstacle was integration into existing systems, at 23%, followed by scaling successful pilots, at 14%, and data quality or readiness, at 13%. Fewer than 1% said funding was the primary barrier.

Capacity constraints also appeared to influence AI outcomes. Among finance leaders who said their transformation agenda exceeded organisational capacity, only 24% reported positive AI returns. Among those who said capacity met or exceeded demand, 79% reported positive AI returns.

Change management

The survey found another mismatch between what finance leaders see as causing delays and where they would direct extra spending. Some 44% ranked change management and employee adoption among the top three sources of delay between strategy and business impact.

However, only 6% said they would allocate a hypothetical additional USD $10 million to that area to improve execution. Even among respondents who identified an organisational issue as the main reason initiatives fail, 46% said they would direct more money to technology, AI or data instead.

The research also examined how Chief Financial Officers spend their time. Nearly six in 10, or 59%, said shaping strategy with the Chief Executive Officer and executive team should be their single biggest use of time, but only 7% said that is currently the case.

Financial planning and analysis was named by 63% as one of their top three current uses of time, while 59% cited reporting and controls. Meanwhile, 27% said their executive teams still view them primarily as financial stewards, compared with 11% who described themselves that way.

On staffing, 63% said AI has reduced finance workloads, but only 2% said they planned to use those efficiencies to reduce headcount or avoid future hiring. Instead, 47% said they expected to redeploy employees into higher-value roles, while 61% anticipated talent gaps in strategic finance and business partnering, 59% in data and analytics, and 54% in AI-enabled finance.