How finance leaders can drive greater impact in life sciences

Three priorities can help finance leaders increase their impact on the decisions that shape business performance.

In brief

• As decisions on growth and investment become more complex, finance has an opportunity to play a larger role in influencing high-value business decisions.
• Many finance functions are still building the capabilities, credibility and operating models needed to help guide the choices that drive long-term value.
• Sector finance leaders who expand finance’s strategic role while investing in future readiness can better position the organization for growth.

Across the life sciences sector, decisions about where to invest, how to prioritize resources and how to create long-term value are becoming increasingly important. Yet for many life sciences finance functions, turning that ambition into reality remains a challenge. Findings from a recent EY survey of CFOs and senior finance executives across industries in the US, including life sciences, suggest that while many finance leaders want to play a larger role in shaping business outcomes, progress toward that goal remains limited. For life sciences finance leaders, this gap represents a significant opportunity to strengthen finance’s influence on the decisions that shape their organizations’ future.

Life sciences finance and strategic decision-making

These decisions often involve R&D investments, pipeline prioritization, commercialization strategies, capital allocation and other key areas that inform where organizations place their focus and how they create value over time.

While the life sciences finance function has an important role to play in helping evaluate those choices, the survey findings suggest many organizations have not yet fully built the capabilities, credibility and operating model required for finance to consistently lead these conversations. For example, only 25% of life sciences respondents say finance leads in guiding investment decisions where returns are uncertain, indirect or long term. As a result, many of the sector’s most consequential decisions often lack the full benefit of a robust finance perspective.

AI adoption and business value for life sciences finance

Likewise, 87% expect fast decision-making enabled by real-time data and analytics to become increasingly important, compared with 80% overall.

As a result, the conversation is increasingly shifting beyond automation and efficiency gains toward how AI can enable faster, more informed decision-making and better business outcomes. According to Wolk, “Rather than starting with ‘where can we apply AI?’, we begin with ‘what problem are we trying to solve?’ and ‘what value are we trying to create?’”

At the same time, there is a significant gap between ambition and readiness, with just 18% of life sciences respondents saying their finance function is AI-ready. But the challenge is not simply technology adoption. Operating model constraints; capability gaps; and manual, unstandardized processes can all limit finance’s ability to apply AI effectively and at scale. “Without the right capabilities and processes in place, finance cannot deliver the timely insight needed to support critical investment decisions,” Cernese says.

These obstacles are often compounded by broader transformation efforts that may not always deliver the expected results. More than one-third (35%) of life sciences respondents say finance transformation has been slower or less effective than expected. As organizations look to scale AI across the enterprise, progress will depend not only on the technology itself but also on whether finance functions have the capabilities, operating models and processes needed to translate AI investments into business value. “AI ambition is certainly high across the sector, but many organizations are still building the finance capabilities, processes and operating models needed to prepare the finance function to scale AI usage effectively,” says Doreen Levine, EY Americas Financial Accounting Advisory Services Health & Life Sciences Sector Leader.

The future finance workforce in life sciences

Finance leaders increasingly recognize that the future finance workforce will require different skills, leadership styles and ways of working. As AI changes how work gets done across the finance function, organizations are rethinking how finance talent is developed and deployed.

Together, these findings suggest that finance leaders recognize the need to evolve beyond traditional finance leadership models. Wolk echoes this belief: “A significant part of my focus is on the next generation of finance talent and how we bring that into the organization.”

While many organizations recognize the need for new skills, creating the conditions to develop them is often a challenge. More than half (55%) of life sciences respondents say their organization’s culture values delivery over learning, while 52% cite limited time or capacity due to role demands as a barrier to development. These findings point to a fundamental challenge: finance professionals are often expected to build new capabilities while continuing to meet the demands of their current roles. As Levine notes, that challenge underscores the need to treat talent development as a strategic investment: “Developing tomorrow’s finance talent requires the same level of commitment as developing tomorrow’s technology.”

Encouragingly, there are signs that some organizations may already be creating the conditions needed to support that investment. For example, 35% of life sciences respondents describe their culture of collaboration as open and enabling. As finance leaders prepare their organizations for a more AI-enabled future, creating the capacity and culture needed to develop the workforce of the future may prove just as important as adopting new technologies.

Three priorities for life sciences finance leaders

The survey findings point to three priorities for life sciences finance leaders as they work to strengthen finance’s role in value creation, apply AI more effectively and prepare the workforce for the future.