2022 CFO Outlook Survey: CFOs Are Optimistic, Despite Ongoing Growth Obstacles

A recent survey of middle market CFOs contains both good and bad news for business leaders. First, the good news: More than a third (66%) of CFOs expect their businesses to be thriving a year from now.

The bad news? Most middle market CFOs say their companies’ growth didn’t meet expectations last year. Just 38% of them said that their company experienced strong financial performance in 2021. These are just a few results of the 2022 BDO Middle Market CFO Outlook Survey, which is conducted annually.

Hurdles to Business Growth

The path to business growth in 2022 and beyond will not be without hurdles, according to the survey respondents. The biggest concerns voiced by CFOs in the survey are:

  • Ongoing supply chain disruptions (84%)
  • Talent shortages (79%)
  • Tax reform (79%)
  • Potential COVID-19 resurgences (78%)

While challenges abound, so do opportunities. This is especially true when it comes to embracing new priorities at the forefront of business and stakeholder agendas like impact, purpose and sustainability. About one-third (64%) of the CFOs who responded to the BDO survey said they believe that implementing an environmental, social and governance (ESG) program will improve their long-term financial performance.

While just one out of three (36%) CFOs said their companies are actively pursuing a sustainability strategy now, virtually all of them (99%) said their company has at least one stated ESG objective this year.

BDO CEO Wayne Berson put it this way: “The next ten years will be driven by a mindset of sustainability and stewardship that prioritizes the needs of all stakeholders while accelerating digital innovation to create lasting business value.”

More Survey Responses

Digging deeper into the survey responses, CFOs view rising material costs (cited by 41% of respondents) as the greatest supply chain-related threat. This was followed by supplier delays (36%), supply shortages (35%) and transportation costs (35%). Accurate demand and inventory management was listed as CFOs’ top supply chain priority this year.

The top workforce challenge listed by CFOs this year is retaining key talent (42%), followed by attracting new talent (39%). To address workforce challenges, CFOs say their companies plan to invest in flexible work arrangements (42%) and increase employee compensation (40%).

Innovation was listed as the number one business priority for 2022 by the survey respondents. Their top strategy for achieving this is collaborating for greater network value (48%), followed by pursuing a joint venture (25%).

Mergers and acquisitions also appear to be a part of CFOs’ plans this year. On the heels of the hot M&A year in 2021, about one-third (31%) of the survey respondents say their companies plan to pursue M&A in 2022, which is up from 24% who said this last year and 25% who said it in 2020. 

The number one strategic goal cited by CFOs for pursuing M&A deals is enhancing their digital capabilities. Over half (53%) of CFOs said their companies plan to pursue digital transformation this year.

Using FaaS to Achieve Growth Objectives

One way CFOs can achieve business growth objectives in 2022 is by managing their finance and accounting function in the cloud. Finance as a Service, or FaaS, makes use of the best finance operation management practices by leveraging advanced technologies like artificial intelligence, machine learning, cloud computing, automation and more to streamline finance and accounting. This can result in lower costs and greater scalability and financial visibility to improve decision making for CFOs.

FaaS is also flexible and provides more control over finances than traditional accounting systems. This will enable you to spend less time on administrative tasks by eliminating the need for manual data entry while eliminating work cycle delays that occur due to waiting for accounts payable or payroll department approvals.

The (79%) concern for talent shortage is easily solved with the Consero FaaS solution. Consero offers a fully managed software & services platform that’s equipped with a skilled finance team along with pre-integrated, enterprise-grade finance and accounting software, featuring digital processes and workflows. With Consero’s FaaS cloud-based finance and accounting solution, you can complete a full digital transformation in 30 to 90 days — much less time than it would take to build an in-house finance and accounting function. 

CFO’s report 1/3 of their workweek is dedicated to managing a finance team. With Consero’s FaaS, business continuity risk is also lowered because companies leveraging FaaS do not need to recruit, hire, train, retain and backfill the finance team. This leaves executives more time to focus on what they do best, growing the business.

To learn more about the benefits of FaaS and Consero’s integrated finance and accounting platform, please request a complimentary consultation.

Consero FaaS: Disrupting the Outdated Traditional F&A Model

  • Cash to GAAP conversion
  • Clean-up work
  • Interim oversight & support
  • Accounting software Implementation

Build it Yourself Solution

  • CFO / Interim CFO
  • Consultants / VARs

Consero FaaS Solution

  • CFO / Interim CFO
  • or Consero Interim CFO
  • Consero Setup/Transformation
Ongoing F&A
  • Monthly financials
  • Daily accounting support
  • Management reporting
  • Integrate add-on acquisitions

Build it Yourself Solution

  • CFO
  • Controllers & Accounting Team
  • Enterprise Accounting Applications

Consero FaaS Solution

  • CFO
  • or Consero Fractional CFO
  • Consero FaaS Enterprise F&A Software and Services

New PE Platform Investment F&A Challenges

Founder Owned Company Accounting:
  • Existing accounting done on a cash/hybrid basis
  • Run on SMB accounting software and other disparate applications
  • Inability to produce auditable financials
  • Lack of know-how to develop projections & KPIs
  • No consistency/structure to customer contracts
  • Underqualified staff
  • Non-scalable manual processes
Carve-Out Accounting:
  • Required to move off parent company accounting applications in a timely fashion
  • Have to build an entire F&A team
  • No documented operational policies and procedures
To Optimized Finance & Accounting:
  • Monthly financials available in 5-10 business days
  • Audit and diligence ready support details
  • Integrated enterprise grade accounting software
  • Budget and forecast reporting
  • Business KPIs
  • Efficient & scalable processes for rolling in add-ons