How business transformation impacts finance – and how to get ready

Today’s business landscape is changing at dazzling speed. Globalization, economic and political changes, rapidly shifting customer demands, new risks, growing regulatory compliance obligations and new technology all put organizations under high pressure and disrupt how business is done. Agility, flexibility and speed have become vital for every company to survive. And as businesses have no choice but to transform, so must finance teams.

Providing business insights

“For decades, CFOs and their teams have handled traditional accounting tasks and reported the numbers,” says Colette Bisschop, manager at delaware. “But now that the management and other stakeholders need to respond quickly to change, they demand transparent, accurate and real-time information to support business decision-making. They look to finance to deliver that. So, more than explaining the past, CFOs have to predict the future. They have to provide the insights that business leaders need to shape their strategies: what products or business models are economically viable; what customers they should target or what the long-term return of extra sustainability measures is – to name but a few examples. Just look at the imminent changes stemming from Brexit. However, it pans out, management expects finance teams to provide scenarios, taking into account possible extra costs in the form of duties, currency fluctuations, taxes or the cost of supply chain disruption in their long-term plans.” 

How technology drives and enables transformation

This new role puts finance teams under pressure. They need the skills to collect and process the data, analyze it and deliver value-driven reporting – and do it quickly and in an agile way. Technologies like cloud, Robotic Process Automation (RPA), artificial intelligence and blockchain can help. “In fact, we are in something of a ‘chicken and egg’ situation where technology is concerned,” says Colette. “On the one hand, new technologies disrupt our businesses and the way we work, thus impacting the finance function. What’s even more, the digital natives who enter our companies urge us to transform our processes and go digital. They expect advanced technology to be part of their work lives. That makes technology a driver for transformation. On the other hand, it is also a major enabler.”

Harnessing the power of new technology

Technological advances in automation can help boost the efficiency – and accuracy – of standard finance tasks such as high-volume transaction processing, accounting and reporting. By performing time-consuming, repetitive accounting tasks, software robots (‘bots’) free up finance people to apply their intellect and creativity to delivering business insights to management decision-making. Big data applications, tools for data visualization and artificial intelligence will add to that business insight by providing access to critical financial and operational data, identifying underlying patterns, predicting scenarios, etc. 

What skills does the new CFO need?

“CFOs have to wear different hats,” says Colette. “They are in the driver’s seat to execute the business strategy and even implement their company’s digital transformation strategy. So, more than being good with figures, they must be able to work with new technology, know how to handle data and truly understand the business. They also need leadership and soft skills (empathy to name one) to work closely together with IT and C-Level management. Moreover, processes and people are changing too. Finance team members need to expand their capabilities beyond traditional finance technical skills. They are expected to have a keen interest in data and analytics and an open, forward-looking and customer-driven attitude. CFOs therefore also need the skills to overcome resistance to new ways of working within their own teams.”

Just go for it

As finance transformation implies installing new processes, utilizing new technologies and adopting new skills, it is not something you can achieve overnight. Instead, it’s a step-by-step journey. “There is no need to instantly throw existing systems overboard or change the course of the finance team 180 degrees overnight,” says Colette. “Yet every company must take their first steps on the transformation journey to make sure they don’t fall behind. So, whether you’re thinking of embracing new technology, developing the role of finance further, expanding your business overseas or are preparing for a merger or acquisition: seize the opportunity to chart your course and kick off your journey.”

Need an outside perspective to see where you stand on your journey to finance transformation, where you need to be and how you can get there? Our finance transformation roadmap can help.