Impact Factors of the Maturity of FSSC in the Digital Age: A Study Based on Structural Equation Modeling

Since the mid-1980s, many multinational companies (MNCs) have transformed their finance functions into financial shared service centers (FSSCs), in order to cut costs and optimize internal operations. When it came to the 21st century, breakthroughs in technology have witnessed the rapid growth of the digital economy, promoting the digital transformation of enterprises and the digital transformation of finance. The construction of a FSSC has laid a solid foundation for the digital transformation of finance and has gained popularity in large companies. However, the practices of FSSC in China are deeply associated with the development of IT. Some scholars see it as a kind of IT application in the finance function, as evidenced by the active involvement of IT companies in the establishment of FSSCs. In this paper, the authors launched a questionnaire to measure the maturity of the FSSC in Chinese companies. Data was analyzed by using structural equation modeling (SEM), aiming to study the factors that have impacts on the maturity of FSSC and the influencing path of the factors. Influencing factors were designed based on the TOE (Technology-Organization-Environment) theory, and the maturity model of FSSC was modified from the PwC (PricewaterhouseCoopers) maturity model of FSSC. And then a structural model was constructed. Various tests for SEM were used, and the study showed that the technological and organizational conditions of enterprises have promoted the construction and development of FSSCs, while the external environmental conditions indirectly influenced the maturity of FSSC through affecting the organizational and technological conditions. The paper also showed the influencing path of the factors.