Digital Transformation and Business-Finance Integration: Mechanisms, Challenges, and Pathways in the Era of Intelligent Finance

Abstract

As digital technologies fundamentally reshape corporate management paradigms, the integration of business operations and financial management-commonly termed "business-finance integration"-has emerged as a critical pathway for achieving value creation and competitive advantage. However, systematic understanding of how organizations can bridge the persistent divide between operational execution and financial oversight remains limited. In this paper, we systematically investigate the theoretical mechanisms, implementation challenges, and strategic pathways of business-finance integration within the broader context of digital transformation. Adopting a multi-method research design, this paper integrates theoretical modeling, systematic literature synthesis, and case-based analysis. Drawing upon synergy theory, data governance theory, and dynamic capabilities theory, we construct a dual-cycle conceptual framework characterized by bidirectional data flows, wherein operational data informs financial intelligence and financial insights reciprocally guide operational optimization. The analysis yields four principal findings. First, business-finance integration creates value through a forward cycle transforming operational data into structured financial information and a feedback cycle channeling financial signals back into operational decision-making. Second, three interrelated barriers impede integration: technological fragmentation, organizational inertia, and capability deficits in hybrid talent. Third, integration effectiveness is contingent upon organizational scale, industry characteristics, and digital infrastructure maturity. Fourth, successful integration requires a tripartite strategic approach encompassing intelligent platform deployment, agile organizational restructuring, and systematic talent cultivation. This paper contributes to the literature by proposing an integrative theoretical framework that synthesizes previously fragmented perspectives, providing a systematic barrier diagnosis extending beyond technological determinism, and deriving actionable strategic pathways for practitioners. These findings offer evidence-based guidance for corporate managers navigating digital transformation journeys and highlight the imperative of cultivating interdisciplinary talent pipelines to support enterprise-level transformation.