What Digital Disruption Really Means For The Future Of Finance

What Digital Disruption Really Means For The Future Of Finance

While it may be tempting to imagine the finance organization as completely automated, analysts believe that most likely it will not become a reality anytime soon. Technology will indeed play a significant role in increasing the speed and efficiency of many finance-related tasks while generating insights that drive better decision-making. However, people will still need to participate – albeit in different roles – to optimize cost reduction, opportunity engagement, and risk mitigation.

The Americas’ SAP User Group (ASUG) Webcast “How Finance Is Driving Growth in Digital Age,” hosted by OpenText, examined this premise with an insightful panel featuring Paul Hamerman, vice president and principal analyst at Forrester Research; Matthias Niessen, program manager for OpenText; and Glen Wedel, associate partner from Ernst & Young.

Digital disruption: An opportunity for reinventing the value of finance

Digital disruption gives finance an unprecedented opportunity to improve growth and profitability. Hamerman suggested, “With real-time in-memory systems, robotics process automation, and a whole host of technology, we can engineer those processes – such as financial closing – to be continuous. Combining the system of record with analytics can help show what’s happening right now, while the inclusion of planning systems and predictive solutions can detail what the business will face in the future. We can also leverage better collaboration and system integration to change the company’s historical orientation from batch and periodic to real-time and predictive.”

By reimagining how other organizations and customers interact with the finance function, Hamerman believes that dramatic improvements will soon follow. “[Finance] can turn insight into action through analytics, which can deliver real cost savings and revenue growth,” he stated.

Delivering on the promise of fast, accurate, and compliant

To realize the full potential of digitization, finance organizations should embrace the growing demand for the digital workplace, flexible cloud deployment, and interoperability. Niessen said, “With a seamless information flow, all stakeholders – internal and external – can gain full access to a 360-degree view of everything from the financial close to disputes and contract terms. And governance and compliance can be managed much more easily in the digital world, but, more important, it no longer just happens by default.”

As a result, the business can reimagine service delivery from a finance perspective by focusing on where it is heading and what opportunities are emerging. For example, finance teams can collaborate with sales teams to define revenue models that work well financially and help drive a high level of customer satisfaction.

New and more effective revenue models require a flexible system – and selecting the right one is not an easy task. “There are so many on the market, especially on the cloud, and certain important aspects are overlooked,” cautioned Niessen. “It is key [that the finance function] analyzes the end-to-end process and use this information to optimize processes and develop ideas and concepts that create additional value not only for the business, but also for the customer and the customers’ customer.”

Three technology innovations set to transform the finance function

Accelerating their digital journey that began over 20 years ago, CFOs can deliver greater insight through enterprise resource planning (ERP) systems and fundamentally transform the level of value the function offers the business.

“Finance leaders need to understand key emerging technology to make pragmatic decisions on when is the optimal time to invest, when to run pilots or other initiatives to test innovations, and which new people and skills are required to be successful,” advised Wedel.

According to Wedel, there are three technologies that play a critical role in transforming the finance organization:

  1. Advanced analytics and forecasting to process large amounts of data, track new types of data, and incorporate that information into new business models as they emerge
  1. Robotic process automation to improve the speed, efficiency, and quality of the revenue cycle while providing additional information that drives greater customer insight
  1. Cloud and software as a service (SaaS) to provide the capacity needed to access ERP, other systems, and the latest innovations hosted by third parties through the Web, instead of internally managed physical servers

A bold digital strategy that encompasses any or all of these technologies requires CFOs to invest in skill development and seek complementary talent. This approach helps ensure the success of adoption by enabling finance employees – disparate or not – to seamlessly share information and make connected, data-driven decisions.

“Better partnering and softer skills will be required to align finance efforts with the business, as the organization, as a whole, strives to become more nimble and more innovative and to adapt to an increasingly volatile marketplace,” concluded Wedel. 

Check out the OpenText eBook to learn how to automate business processes and launch ahead of the competition

or listen to the replay and presentation of the ASUG Webcast, “How Finance Is Driving Growth in Digital Age.”

 

This article was originally published by Digitalist Magazine.