Transaction processing. Reporting. Compliance.
A traditional finance wheelhouse primarily concerns itself with these three areas, all of which share a common trait: they focus on things that have already happened.
During a recent webinar, The Future of Finance, hosted by Sage, it was clear that the role of the Chief Financial Officer, and the team that supports that office, is rapidly becoming more strategic and prestigious.
Professor Herman Singh, CEO of Future Advisory, used an aviation analogy to explain the new demands on the finance function.
“Every business needs a flight plan and must regularly test its parameters. And if the aircraft deviates from the plan, the CFO must be able to adjust course.”
Sage Intacct Power Session – Embrace the future of finance
What lies ahead for the finance function? In this Power Session, Fifi Peters (Financial Anchor, CNBC Africa), Professor Herman Singh, CEO of Future Advisory and Gerhard Hartman, VP of Medium Business for Sage Africa & Middle East, unpack the trends that impact the future of finance.
Getting everyone on board
Attendees were asked in a survey to choose which option best described what the ‘future of finance’ meant to them. The majority ticked the ‘smart combination of people and technology’ box.
Speaking during the webinar, Gerhard Hartman, Vice President of Medium Business for Sage Africa & Middle East, said that, for finance teams to become more strategic, they need to free themselves from the monotony of mundane tasks.
Embracing the likes of artificial intelligence, machine learning, and automation is central to achieving that outcome. But it’s a transition that needs to be handled carefully.
Is there an optimal way to ensure your people embrace technology and their changing responsibilities? Creating and communicating a roadmap of how your business plans to adopt technology is an excellent place to start.
Plot your course
Digital transformation refers to any business function that deploys technology to improve how you do things. It’s a journey that isn’t walked in a night, nor do you need to digitise everything at once. But you should apply your mind as to which tasks and processes would benefit most from digitisation and then create a plan detailing how the transformation will happen.
Some of the critical areas any finance function should focus on include:
- Use of automation and robotics to streamline finance processes,
- Data visualisation that gives users access to actionable, real-time insights, and
- Analytics that support strategic decision-making within the business.
How does this digitisation manifest? It’s a long, exciting list:
- Cloud-based financial planning and budgeting functions that are agile, centralised, accessible, and up to date,
- The automation of report generation and data reconciliations,
- Easy-to-use dashboards packed with insight for improved decision-making,
- The ability to collate data from multiple sources for a unified view of financial positioning,
- Forecasts powered by constantly improving algorithms, and
- More sophisticated working capital management, to name a few.
As exciting as these prospects are, they are unlikely to run the course of their full potential without a plan in place. As Professor Singh said towards the end of the webinar, “The three most important things in any business are direction, alignment, and commitment.” All three require good planning.
The bigger picture here is that by pledging to digitise your finance function, you’re putting it on course for a higher purpose – your newfound ability to offer strategic direction means you become responsible for shaping the destiny of your business.
The irony, and conundrum, is that all businesses today must embrace rapid technological progress to keep up with the demands of their consumers when it is often those very trappings of technology that cause their shifting expectations in the first place. To remain relevant, then, you’ll need to accept that ongoing change to your business, particularly in the realm of technology, is not only inevitable but is key to your survival.
With the volume and richness of data that now flows through finance functions everywhere, the most significant potential impact from digitisation lies, arguably, within your department. But only those who employ agile systems will be able to evolve at speed necessary to maintain that higher strategic status.
Harking back to Professor Singh’s aviation analogy, the finance function of any business must have:
- A flight plan that everyone is on board with,
- A digitised dashboard, fed with real-time data that highlights deviations from that plan, and
- The necessary insight and conviction to suggest corrective action.
In conclusion, he offered a brief explanation of how finance teams must evolve to stay relevant and, indeed, elevate their standing: “We must transition from a focus on hindsight to the pursuit of insight, and eventually, foresight.”
Discover how Sage Intacct takes the stress away and can make financial management fun and empowering.
CFO 3.0: Digital Transformation Beyond Financial Management
Discover how CFOs are playing a key role in leading the digitalisation of medium-sized businesses and learn how to move from a 'historian' to a 'visionary' within your business.