CFOs know they can boost productivity with generative AI. They’re less convinced current employees are using it optimally

The Q1 2024 Deloitte CFO Signals survey released this morning finds that among the finance chiefs surveyed, GenAI adoption was encouraged most in IT, business operations, customer/client services, finance, and sales and marketing. And 70% of CFOs expect productivity hikes of between 1% and 10%, according to the report.

But GenAI has yet to have a measurable effect on finance departments. According to the report, 61% said the tech is having either a minimal impact or no impact on current finance talent models, and 44% reported a minimal to moderate impact. Talent seems to be a large hurdle as the top two concerns among CFOs are GenAI technical skills (65%) and fluency (53%).

“They all know that it’s coming, they know they need to lean into it—both at the finance level and enterprise level—but they’re really just starting to understand the use cases,” Steve Gallucci, Deloitte’s global and U.S. CFO program leader, told me. The majority (93%) of CFOs surveyed said bringing in talent with GenAI skills over the next two years is important, with more than half of respondents also saying it’s important to further develop current employees.

For the small number of CFOs using GenAI in finance, it’s typically for transactional services, routine and repetitive tasks, and financial planning and analysis, according to the report. Certain sectors ahead of the curve are financial services and tech, according to Gallucci.  

The findings are based on a survey of 116 CFOs in the U.S., Canada, and Mexico, with 67% from public companies and 33% from privately held firms. The vast majority are from companies with more than $1 billion in annual revenue. 

The survey also found that 58% of finance chiefs said they’re “somewhat” or “very much” being pressured by the board to implement GenAI across the enterprise, with just 34% saying boards specifically want the technology used in the finance function. (And 33% said their boards aren’t encouraging the adoption of GenAI in finance at all.)

GenAI implementation won’t happen overnight. Overall, 62% of CFOs surveyed said they expect less than 1% of their company’s budget to be allocated to tech next year, with 37% expecting an allocation of 1% to 10%, and 1% expecting that figure to be 10% to 25%.

‘Uptick in optimism’

Compared with the last several quarters, “there clearly was an uptick in optimism,” Gallucci said of the Q1 data.

More than half (59%) of CFOs rate the current North American economy as good or very good, with 54% saying they expect conditions to improve in a year. Net optimism, as measured by Deloitte, nearly tripled quarter over quarter (up to +31 from +11), and many CFOs also have raised their year-over-year growth expectations compared with projections from Q4.

“CFOs are continuing to see the economy improving, and their own company prospects improving,” Gallucci said. “But at the same time, they’re still concerned about the uncertainties that exist within the economy.”

CFOs are mostly losing sleep over macroeconomic and geopolitical concerns, including upcoming elections around the world and in the U.S., where, Gallucci told me, “There’s a high degree of uncertainty in terms of where that will land, and then what the resulting policy decisions will be.”

Sheryl Estrada
sheryl.estrada@fortune.com

María Soledad Davila Calero curated the Leaderboard and Overheard sections of today’s newsletter.

Leaderboard

Anastasia Marras was promoted to CFO of ZMC, a private equity firm focused on the media and communication sector. Marras has been at ZMC for seven years and was previously the firm’s director of finance. Additionally, Marras has also worked for SS&C Private Equity Services, Inc. and Citi Private Equity Services.

Alice Pope will take over as executive vice president and CFO of healthcare network NovantHealth on May 13. Pope’s resume has over 35 years of experience and previous experience in the healthcare sector including Inova Health System, HonorHealth in Wellmont Health.

Big deal

In February, 10 U.S. bank deals were announced, equaling January's tally, according to S&P Global Market Intelligence data. The year-to-date deal value is $939.3 million. 

In comparison, over the first two months of 2023, there were 15 bank deals announced for a combined $342.5 million. "The slow start to bank M&A in 2024 comes after 2023 was a historically low year for deal announcements," according to the report. 

Going deeper

In the latest edition of Wharton's Ripple Effect podcast, “Creating More Gender Equality in the Workplace,” Professor Maurice Schweitzer explains how shifting perspectives on gender are affecting women at work. “You can think about gender differences that reflect how people act, and then how people are treated, and then how people are evaluated based upon their behaviors,” Schweitzer says. “And there’s evidence to suggest that women incur some costs in all three of those categories.”

Overheard

“We don’t actually take ourselves seriously. We don’t think we’re extreme. We’re kind of making fun of all that extreme marketing.”

— Liquid Death CEO Mike Cessario told Fortune about the marketing strategy for his water in a can. Rather than going for the traditional style, Liquid Death’s can and marketing style closely resemble those of alcoholic drinks. This approach has lead the company to now be valued at $1.4 billion.