"Less than one-third of CFOs are confident that their technologies are aligned with their requirements for ensuring the future success of the organization." - Gartner
The concept of digital finance function is still new for many organizations. But most business leaders say digitalization initiatives are accelerating and believe that digital technologies will greatly transform their industry in the next five years. Here, CFOs play a vital role and there’s a clear mandate for them to take the lead, as they are responsible to accelerate digitalization within the organization.
According to a survey, CFOs themselves say they want to explore various digital initiatives along with their applications to finance tasks. So, here are some ways that will help CFOs accelerate the digital finance function.
What is Digital Finance Function?
Digital Finance Function is not just limited to finance, but it’s an umbrella term that describes an organization’s efforts in utilizing digital technologies to improve current business operations. This process includes various practices such as adopting cloud-based software, deploying digital platforms, and general automation by implementing cutting-edge technology.
Moreover, businesses need to shift towards digital finance practices to keep up with the latest technology trends, and meet their consumer needs. If executed effectively, digital finance function can offer multiple benefits such as:
· Improved Efficiencies
· Reduced Errors
· Accelerated Processes
· Improved Employee Performance
· Tangible Financial Gains
How to Accelerate the Digital Finance Function?
1. Technology Investment
Many organizations are still using outdated technologies and clumsy finance processes. Moreover, very few CFOs are confident that their techniques will drive results and ensure future success of the organization. So, it becomes incredibly important for them to invest in the latest value-driven finance technologies.
Finance AI is a crucial next step towards hyper automation which enables automation of process orchestration, not just tasks. Automation of complex finance processes using additional technologies offers multiple benefits. This also allows CFOs to focus on identifying new value-added services, such as set pricing according to consumer behaviour or automatically forecast long-term real estate value.
2. Data and Analytics
Nowadays, it is common practice for companies to experiment with advanced analytics to find relevant insights, helping them improve tactical decision making. Furthermore, CFOs can make efficient use of these analytics to manage standard financial transactions and core processes effortlessly.
CFOs can also team up with the CEO, board, along with other senior leaders to identify broader ways of applying data and analytics to explore new sources of business value. In fact, a CFO should clearly express the leadership role he/she wants to play in rendering burning business questions into use cases for data and analytics, such as price optimization, identification of customer churn, talent management, or explore the various other applications.
3. Cloud Adoption
Most organizations have shifted their key financial activities to the cloud. But we can’t deny that they still need to scale these processes to support business essentials. It is advisable to hire cloud service providers for their experience in handling large volumes of data. Hence, they can provide better data security than on-premises or private cloud solutions.
Therefore it is important to find the right expert, at the right time, and the right price, so they can deploy solutions in places, enhancing the speed, trust and predictive nature of insights.
4. Digital Upskilling
What’s the most important thing for a successful digital finance function? Well, digital skills become incredibly important in running a real-time, technology driven business. But only a small percentage of business leaders believe that their team have enough proficiency in digital finance function. CFOs need to understand their role in filling the digital skills gap in finance, so they can improve the organization’s potential to efficiently utilize digital technology capabilities. CFOs may also consider changing their approach to finding in-demand digital skills according to the ever-changing market needs.
The “Skill-sensing approach” is one of the most effective ways to find desired digital skills, which advises that you engage with HR partners to predict skill shifts as they are occurring – rather than predicting the future yourself and adapting to those shifts in an iterative, course-corrective way.
5. Waste Reduction
Robotic Process Automation (RPA) has helped improving speed, efficiency and cost optimization, but we still expect the finance professional to enhance decision support while also reducing costs. Hence, it’s crucial for CFOs to reassess the advantages of existing RPA programs and ensure they meet their business goals.
RPA excels in automating complex activities such as budgeting and forecasting by utilizing machine learning. This practice will also allow relevant staff to focus on critical decision support-aspects of their jobs.
This is a high-level guide to accelerating the digital finance function, with the aim of highlighting the core areas to be considered in embracing the benefits of technology into reducing or eliminating time-wasting processes.
It’s also important to review the technology competence with members of the IT function, helping you define system requirements and investments. It is also recommended to select technology that is innovative and fit for purpose.
How SOBI Analytics Can Help
SOBI Analytics is an AI powered Business Intelligence platform designed specifically for Finance Professionals who need access to ERP functionality for their mid-market clients.
Replacing manual, time-consuming, inefficient processes with real-time access to deep cross-business performance insights, SOBI improves efficiencies by almost 80%, whilst at the same time reducing the risk of data corruption from human error.
Coupled with the improved efficiencies and reduced costs, users of SOBI enjoy the benefits of having access to real-time business insights, which allows them to focus on maximising their performance results, adding value to their bottom line. Apart from our AI solution, we have deep domain expertise, and are always willing to help firms navigating the change involved in progressing their finance function.