Finance departments need to play catch-up; automation offers a path for CFOs to refocus on strategic priorities and unlock valuable insights from legacy systems and organizational silos.
As companies transform themselves to be more resilient in the digital economy, not all business functions are making progress. Finance, by and large, remains a “traditional”domain, focused on narrowly defined, repetitive tasks in often-siloed areas like accounting, budgeting and compliance. This needs to change. But how are CFOs and finance leaders
navigating this tricky terrain?
Automation of the so-called transactional processes that are the bread and butter of corporate finance is perhaps the essential first step toward realizing the vision of the transformed finance department. CFOs are spending too much time managing arcane processes and gathering data – and not enough time analyzing it and delivering incisive guidance to shape the strategic direction of their organizations.
But with a multitude of information and tools on the market, finance leaders often find it tough to vet and implement an automation strategy appropriate to their organization’s needs. If this is you – and you want to get this right, you need to understand the trends and key considerations that underpin proper return on investment (ROI) in digital financial transformation.
The State of Play in Finance Today
An industry report by Workday titled Finance Redefined, the Global Finance Leader Survey, claims that digital transformation efforts in finance lag behind other corporate functions, such as marketing and HR. (1) As a result, many finance leaders do not feel equipped to deliver the strategic insights increasingly expected of them by corporate leadership.
Research by PwC paints a similar picture. The Finance Effectiveness Benchmark Report 2017, reports that only 24 percent of finance time is spent on insight-generating activities, with 61 percent on process efficiency and 15 percent on process control. According to the report, between 35 and 46 percent of processing time for several key finance processes could be mitigated through automation and eliminating waste. (3)
The Bottom Line: what Finance Leaders Need to Know
There’s no shortage of consultants and tools that promise to enable this kind of transformation. All the familiar names, including Oracle, IBM, SAP, Microsoft, Netsuite and others offer their own benefits and drawbacks that CFOs must weigh.
The right path will depend on each organizations idiosyncrasies and circumstances, but honing in on the best ROI requires a specific set of considerations. CFOs and finance leaders should be asking themselves the following questions:
1. Process efficiency – How much waste in existing processes can we eliminate? (See Fig. 1 below for PwC’s assessment by finance function)
2. User productivity – To what degree are employees enabled to “work smarter, not harder”? Will they be able to manage their core responsibilities and support strategic insight gathering?
3. In-house competencies – How far will new platforms or tools be configurable, adaptable and scalable based on internal skills?
4. Integration with exiting systems – Will new tools or platforms play well with existing ERP systems? Can they be extended or scaled to other key functions without disruption? Will it foster collaboration?
5. Speed from 0 to 60 – What has to happen before we can flip the on switch? How much remediation of existing code or software – or revamping of workflow processes is required?
6. Future proofing – If the organization needs to pivot or adapt its workflows, will it break things or result in significant downtime that impacts strategic readiness?
7. Cost – The bottom line. How is pricing determined? How will possible future organizational changes – and growth – affect the cost moving forward? ROI ultimately comes down to is a favorable balancing of cost with value.
A a finance leader, you should aim to implement a transformation that disrupts your workflow without disrupting your work. Your solution should not require a broad rethinking of your processes or significant retraining of your personnel. Equally important, you don’t want to be locked into reliance on consultants or specialized external technical expertise if something goes wrong or changes are needed.
If you’re left with one take-away, it’s this: Automating your way to an agile, digitally transformed finance function should end the tradeoff between getting basic, transactional work done and adopting the strategic posture redefining finance’s role in business. With a focus on ROI and the right answers to the questions above, finance can lead its peers in creating the agile, resilient and strategic enterprise of the future.
Fig: 1 Roughly 40 percent of finance effort could be aligned to more value driven activities through automation. Lower-cost, easily accessible technology is changing the rules—making sense of complex data and providing collaboration, insight and efficiency. (4)
 Finance Redefined, the Workday Global Finance Leader Survey.
 Do you define your CFO role? Or does it define you? The disruption of the CFO’s DNA , EY.
 Finance Effectiveness Benchmark Report 2017, PwC.
 Finance Effectiveness Benchmark Report 2017, PwC.
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