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A new report into reporting and forecasting processes in European companies offers suggestions for improvement

What are the hot topics that finance directors are facing this year? In short, it’s people, performance and processes, in that order, according to recent research by BPM International, a network of business performance management consultancies, the UK arm of which is Paragon Consulting.

The research questioned group FDs, financial controllers and planning managers in more than 130 European businesses, the bulk of which had revenues in excess of (euro) 1bn. It found that people pipped performance as the agenda-topping issue: improving the skills and capabilities of finance staff was regarded by 81% of the companies taking part in the survey as a ‘hot topic’ for 2007, just slightly ahead of the need to improve performance (80%).

People issues feature in the business units as well as the corporate centre, the research found, adding that 72% of respondents ranked ‘operational excellence in the finance function’ as a priority. But with such a high proportion chasing after excellence, the report authors said it was “astonishing how many companies have still not managed to get their basics right”. Moreover, the research unearthed the fact that there is a high potential for improvement in many businesses.

Performance management, predictably enough, was almost equally high, but further investigation by the researchers suggests that corporate performance is still not good enough: the blame would appear to lie with “external distractions” such as the demands of Sarbanes-Oxley compliance, IFRS and, for financial services groups, Basel II.

AccountancyAge: FDs tackle reporting processes