CFOs who adopt a composable technology strategy will achieve higher revenue growth than peers who take more traditional routes with their technology investments, according to Gartner, Inc. By 2024, 60% of finance organizations will seek composable finance applications in new technology investments.
Gartner has identified a new model for CFOs based on a composable technology paradigm that focuses on modular technology solutions delivered by best-fit vendors that enable specific finance capabilities. The framework is built upon three distinct layers of composable platforms (groups of related finance applications) based on the main purpose and the strategic value they deliver (see Figure 1).
CFOs are near unanimous in their intentions to invest more in technology in 2023, yet most will be held back from achieving their objectives by legacy mindsets in their approaches to upgrading their technology systems. Traditionally, most finance department technology planning prizes elements that are not compatible with agility and innovation, such as selecting large complex systems that can be used by multiple departments and favoring a single vendor approach for technology selection.
“The needs of the business and dynamic nature of new technologies have outrun the traditional technology planning models relied upon by CFOs,” said Nisha Bhandare, VP analyst, research, in the Gartner Finance practice. “What may appear to be efficient and practical on the surface actually keeps CFOs stuck in outdated and siloed systems, in what we call the ‘trap of traditional thinking’.”