Quality, integrated data is a top challenge for middle market finance teams

Middle market CFOs say that data integration is the “top barrier” to finance modernization efforts, according to a new report from Cherry Bekaert.

In a survey of 200 CFOs and senior finance leaders at middle market organizations in the US, the accounting firm found that more than half (55%) of respondents said data accuracy and consistency was a major challenge. Nearly half (48%) said integration complexity was the “number one challenge their company faces.”

In addition, 84% of finance executives said improving data quality and integration was their top priority in the coming year.

“Fragmented systems and manual workarounds slow decision making and erode confidence,” according to the report. “CFOs are prioritizing clean, connected data to unlock strategic insights.”

Financial planning and forecasting was the activity most impacted by lack of data, 49% of respondents said. Other significantly affected areas include operational performance monitoring (46%), budgeting and cost control (33%), and risk management and compliance (27%).

But tight budgets slowed down finance modernization efforts, the survey found. More than two in five respondents (42%) said they spent between 10% and 20% of finance budgets on modernization, but a third said they spend less than 10% of their budgets on such efforts. According to the report, “limited investment means CFOs must be highly selective to maximize return.”

In addition to improving data quality and integration, Cherry Bekaert also recommended that finance teams optimize technology, streamline processes, improve reporting, and train up their existing talent.

High-quality, integrated data is also key to successful AI adoption, as CFO Brew previously reported. According to a Workiva survey, nearly two-thirds of practitioners said a lack of “high-quality data” impacted AI use at their organizations.

“If your organization is all-in on AI and you’re not all-in on data, you might have a problem one day,” Alexander Davis, deputy CFO of Pie Insurance, said at Workiva’s annual conference in September.