How CFOs can digitalise the finance industry

October 20, 2023

Finance as a function must ensure that any data applied is reliable and everyone has confidence in the information used. If data quality becomes a challenge, managing and assessing the overall strategy and associated investments will become a concern.

The digital transformation of finance requires a shift towards automating many processes with a move to cloud-focused enterprise resource planning (ERP) incorporating areas like accounting, HR and supply chain operations. Finance must consider the automation process and ensure it operates as expected.

The process of digitisation has resulted in a complete transformation of the traditional role and expectation of the finance function in many businesses. Finance activities can be automated to some extent, generating higher efficiency and better finance organisations. Digitalised finance processes can strengthen the quality of internal processes.

The finance function incorporates operation and financial data and applies advanced analytics and AI to enhance business decisions while working as a service provider for the entire business. It becomes a trusted partner to business teams, supporting them with the decision-making process. For many companies, this transformation is already happening and has enabled finance to integrate more effectively with the business and have more influence on the overall output.

Measures applied to evaluate a project are changing rapidly. The main focus of digital transformation has predominantly focused on refining the overall customer experience, so the entire business, including finance, must consider the end-to-end customer experience. Projects are evaluated on customer experience outlook, in addition to a financial performance metric.

New data sources aren’t the only changes to reporting and forecasting. Businesses are applying constant reporting and forecasting instead of annual budgeting, which can take time to complete. While financial reporting and planning has typically focused on internal metrics, businesses are exploring improvements in accuracy by harnessing external data measures such as customer behaviours. Finance as a function must monitor what added services and solutions are required and support the business with its data analytics and continuous planning and forecasting.

One of the main changes to the finance function is its critical role in the overall data ecosystem of a business. Finance as a function will define the controls around data, it will be responsible for ensuring an organisation has the necessary data and insights to ensure the business is performing and moving in the right direction.

Structured data from ERP and EPM solutions will typically support external reporting, financial results and management reporting. When combined with external, unstructured data, it supports making informed management decisions.

Robotic process automation (RPA) and Artificial Intelligence (AI) can automate processes, manage unstructured data and combine it with structured data.

Finance as a function needs to ensure data is reliable and people working with this information have confidence in using it. If data quality becomes concerning, managing and determining the business strategy and investments will be challenging. With so much data now available, it’s not possible to ensure all information is accurate and validated. Businesses must focus attention on data verification on information most vital to decision-making.
We all have a responsibility to create a clear roadmap and prepare ourselves for future developments. In the finance sector, this means committing to having the right people and technology available to take advantage of the next wave of progression.

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