Pssst. Is that the economy humming along? According to Deloitte's "2023 Q3 CFO Signals" survey, 57% of North American CFOs rate current economic conditions as "good" or "very good"—up from 34% last quarter. If you're keeping score, that's the highest mark since the first quarter of last year.
The survey says CFOs also are optimistic about their own companies' financial prospects, including expectations for year-over-year growth.
Key takeaways from the "CFO Signals" including:
- Upbeat, but cautious — For the North American economy, CFOs are more positive than they have been since 1Q22, with net optimism for their own companies’ financial prospects climbing to +22 from +6 last quarter. Still, geopolitics—CFOs’ most-often cited external risk—cast a shadow.
- Expected growth in performance and hiring — CFOs raised their year-over-year growth expectations for revenue, earnings, and domestic hiring from last quarter, and lowered them for dividends, capital investment and domestic wages/salaries.
- A spike in CFOs considering US equities overvalued — More than half of CFOs (56%) say US. equities are overvalued, up from 39% last quarter. The majority of CFOs consider debt and equity financing unattractive and say now is not a good time to be taking greater risks.
- Experimenting with GenAIon a budget — Forty-two percent of CFOs say their companies are experimenting with GenAI, and 15% are building it into their strategy. Roughly two-thirds of surveyed CFOs say less than 1% of next year’s budget will be spent on GenAI, and about one-third of CFOs project 1% to 5%.
- Talent holds the key — For 63% of CFOs the greatest barriers to adopting and deploying GenAIare talent resources and capabilities. Talent also appears at the top of CFOs’internal risks, specifically availability and capabilities, morale, disengagement, and leadership, just ahead of execution risks.
Experimenting with generative AI
With Generative AI in the headlines almost daily, the survey also honed in on what CFOs are thinking about technology. According to the survey, 42% are experimenting with it, while 15% are incorporating it into their business strategy.
For nearly one-quarter of CFOs, GenAI is important to achieving their business strategy, compared to 42% who say the technology is not important overall. That leaves more than one-third of CFOs not yet weighing in on whether GenAI is important or not to achieving their organizations’ business strategy.
For 17% of CFOs, it is too soon to tell where their organizations stand on its GenAI journey, but nearly one-quarter of CFOs indicate their organizations are reading and talking about it.
Like other business leaders, CFOs are concerned about adopting and deploying the technology. Their top concerns include an impact on risk and internal controls (57%), data infrastructure and technology needs (52%), investment requirements (51%), and governance requirements (49%).
The biggest obstacle in adopting and deploying GenAI, according to 63% of CFOs, was obtaining the necessary talent resources and capabilities. That was followed by data and technology resources (49%), risk and governance concerns (45%) and competing priorities (42%).
To see the survey, CLICK HERE.
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