Article credit: Sage 

In the past, the CFO role might have been more comparable to someone focused on crunching the numbers, rather than the C-suite figurehead we know now.

CFOs were more focused on history – generating reports about the past through business processes.

Today, if you are in the CFO role, your business needs you to focus on strategy, analysing both current and future growth prospects.

You need to have a more holistic view of business operations and market development, being in tune with customers, products and services, all the while increasing value.

But how can you deal with these increasing demands both now and the future? With technology.

Technology is what you to transition from being the manager of finances via a view of the past to become the person in charge of unlocking of the most valuable future opportunities.

Technology is integral to modern businesses.

Without technology, digital transformation is impossible, and your finance function won’t be ready and equipped to meet the challenges both now and one, five and 10 years down the line.

You need to embrace innovation and arm your finance team with the right tools to improve and increase effectiveness.

Finance leaders agree that technology is the top way to improve the effectiveness of the finance function.

So what should you be focusing on when it comes to using technology to improve your finance processes? We cover some key areas in this article.

Data quality and data science

What is it?

Data science, as applied to finance, is where you build systems and processes to extract data, which allows you to draw insight you can use to predict the future, and make evidence-based decisions and suggest improvements.

Why should you adopt it?

According to executive search firm Leathwaite, 51% of finance functions are already using data quality and data science, while 36% are planning to use it.

With data science and better data quality, you can better understand customer needs and dig out patterns that help you know where you should put your investment.

Steps to take to adopt it

To put data at the heart of long-term business success you should focus on six areas:

• Make a case for data as integral to the business strategy by identifying proof of concept projects
• Align the analytics capability and delivery with priority business requirements
• Help instil the right leadership and culture
• Provide training to help individuals recognise decision biases – the psychological assumptions that often lead to poor decision-making
• Provide easy-to-use tools for users of data
• Transform the analytics-based insights into actions, and align incentives, rewards and measurement accordingly.

Automation

What is it?

Automation, as it relates to finance, is the use of financial software to automate tasks such as accounts reconciliation and preparing financial statements and reports, without the need for humans to spend lots of time doing so.

Why should you adopt it?

Automation can relieve your finance team of menial and tedious tasks, allowing you and your team to spend more time on more strategic tasks.

Steps to take to adopt it

1. Understand what kind of automation you need

Every business is different, and it’s crucial to get the best value for the automation you implement and the best for your business needs.

There are different types – from variations that help businesses automate daily tasks, to more advanced types that combine with machine learning to perform more complex actions in response to human interaction.

2. Start automation in the right departments

You’ll know from a bit of analysis which tasks automation would help. Automation could undoubtedly help in back-office processes in the finance department.

It could automate processes in areas such as marketing, legal, sales and the supply chain. Aim for quick wins allowing you to visualise a future roadmap.

3. Ask if automation makes economic sense

When looking at the opportunities for automation within departments, you should question how economically viable these opportunities are for the business.

For instance, you should investigate the return on investment. Get the relevant stakeholders in from the departments in question and try and create a business case.

4. Get management buy-in

You need to get information straight from stakeholders on what they understand when it comes to automation and how it would be able to benefit them.

You and other members of the leadership team should help the wider business understand what automation can do and how it could make their working lives more comfortable, letting them focus on more critical, less repetitive tasks.

5. Work at the right speed

The IT team can provide technical expertise and to make sure the implementation runs smoothly and at the right pace.

The technical leadership need to adopt a strategy of starting small, getting the business used to the technology, and expanding it out when the company gets used to the changes.

AI/machine learning

What is it?

Artificial intelligence (AI) is an all-encompassing term that covers all technology that can mimic human intelligence and has been in development since the 1950s.

A type of AI, machine learning allows systems to learn and improve through experience, without needing to be explicitly programmed.

Why should you adopt it?

Machine learning means computers can handle new experiences through analysis, self-training, observation and experience.

It allows computers to learn automatically without human intervention or assistance through complex algorithms so you can analyse massive amounts of data.

21% of finance teams are already using AI/machine learning, while 46% are planning to use it.

Steps to take to adopt it

Initially ask these fundamental questions:

• Can the application of AI/machine learning make your business run more effectively and efficiently?
• Can AI/machine learning solve your business problems?
• Can AI/machine learning make your business more profitable?

The likelihood of AI solving some of your biggest challenges grows as the technology gets closer to maturity. You must have a clear focus on what AI/machine learning can do to achieve your business goals – this must be the driving force.

If you’re thinking about practical AI/machine learning business applications, you could look at how computers process and identify patterns in data.

They do this much more effectively and efficiently than humans, allowing much better insight.

Standardised, ‘off-the-shelf’ AI/machine learning services might address simple scenarios such as image recognition and voice to text.

But advanced predictive scenarios that provide more business value require much more sophisticated and customised solutions tailored to their specific business and operational needs.

Adopt use tech to be more effective

As a CFO, you’re in the prime position to oversee the technology needed to support and grow your business, drive digital transformation, and commit your company to change.

Of course technology by itself won’t lead to improvement – that’s why you’re there to set clear goals and make sure the right tools are used in the right way.

Support your business in investing in the right technologies through your knowledge of what they can do to drive your company forwards.

Article credit: Sage 

With South Africa complying to lockdown requirements from the government, businesses continue to face challenges.

Lord Sorrell, founder of advertising agency WPP and once CFO for Saatchi & Saatchi, says this about coronavirus: “It’s not like the dot-com bust, it’s not like 9/11, it’s not like the great financial crisis; it’s almost like a war.”

As the CFO, in the combat against coronavirus, you’re playing an important role.

You may be fortunate to be in an industry that’s experiencing high growth during these pandemic times. Lockdowns and working from home have resulted in a boom in sectors that provide products and services such as DIY and home entertainment.

Driving digital transformation

Businesses and the way they operate are undergoing a process of evolution. Customers and employees are changing and have access to a plethora of business tools that weren’t available before.

Who is driving this digital transformation? Well, according to our recent research, it’s you, the CFO.

CFOs help to shape and drive business direction and strategy. You’re more aligned with managing directors and CEOs – you don’t just crunch the numbers. You’re now required to provide up-to-date information, financial analysis and forecasting at rapid speeds

Today, the financial profession plays a key role in their organisation’s digital strategy in medium businesses, with 9 in 10 financial decision-makers doing precisely that. Meanwhile, 15% say they are fully responsible for digital transformation.

Currently, it’s not only about looking backwards into the rear-view mirror and analysing past performance. It’s about becoming a future CFO and looking forwards.

Three things to change within the finance function

When it comes to moving with the times, digitalisation is critical, with data changing the dynamics of decision making.

Technology and tools are now available to automate your financial processes. You can add the ‘why’ to what happened, using data for strategic insight.

It’s a new era where advanced technology such as artificial intelligence and machine learning are finally becoming genuine options for your business.

Here are three things to keep your finance team moving in the right direction.

1. Move from spreadsheets to software

Spreadsheets have associations with finance – think of the CFO stereotype burning the midnight oil, buried deep into the intricacies of Excel.

Today, you don’t have the time to spend hours interpreting data to create meaningful charts and graphs. And you certainly don’t want to deal with the frustrations of tying the data you have in spreadsheets together.

The right financial software can automate these processes, saving you hours in building the reports you need to present to the business.

It provides the data visibility that will help you add value to business strategy and set a suitable course in the future.

You’ll find excellent value in business intelligence, in the form of insightful dashboards and reports you can auto-generate.

2. Implement automation

Digitalisation holds great promise, but it’s no good if you spend your time collecting and preparing data, rather than analysing it. We’ve found 70% of CFOs agree that administration harms team productivity.

Your financial team’s strategic responsibilities mean it’s essential you give the grunt work to machines.

You can automate menial tasks that involve data entry such as invoice-chasing, payroll and expense management, freeing you up to make smart decisions quickly that can lead to benefits for the business.

3. Invest in financial technology

Businesses are already well aware of the impact financial technology has on improving productivity – more than 80% believes it plays a crucial role in tomorrow’s finance function.

Business leaders are aware of the benefits through centralisation with increased cost efficiencies, flexibility, integration and security. So, it’s no wonder that it can empower business.

And think about where can you be most effective. By enabling a connected operating environment that provides greater automation and advances in real-time insights, your business can truly prosper.

Take the right steps to implement change

Having the right technology is all well and good. But before you rush in and implement it, you need to understand whether your team is culturally ready for automation and other cloud technologies.

According to our research, it shouldn’t be a huge problem – 82% of financial decision-makers are already comfortable with using automation for daily accounting tasks.

However, there will be challenges.

Our research revealed 27% of financial decision-makers didn’t think their business was culturally ready for more automation.

Even though you may feel you understand the value of disruptive technologies, other employees and even those on the board may not feel that way.

Start by involving key players within the business in detailing a new automation strategy, so all parties can agree on what you can or should automate.

Take them through the process, so the team are developing and upskilling together.

Indeed, 73% of financial decision-makers believe the introduction of new technology needs a detailed implementation and roll-out plan to ensure it carefully aligns with the culture of an organisation.

The reluctance to further adopt technology may be down to more than just culture.

Amid the growing use of technology within businesses, your team may be worried about the extent to which roles will be automated in the future.

For companies to get the most from technology, there needs to be an alignment between strategy and the culture and reassurance that roles won’t be lost but will instead change focus towards positions that add move value to the business.

Final thoughts

Shaping the strategy is akin to shaping the business, and you are the visionary. You’re responsible for predicting the direction of the company, uncovering hidden opportunities and closing gaps within an organisation that is increasingly data and insights-driven.

As such, it’s worth making investments in digital platforms, tools and systems today so your business can prosper both now and in the future.

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