In the era of digital transformation there isn’t a finance department on the planet that doesn’t get the dangers of being overly dependent on Excel spreadsheets and paper trails, but not all of them are making the connection between abandoning old ways of doing things and the benefits that will come from embracing digital.
If the CFO applies a data-driven approach to how everyday finance functions operate, the rewards will be quick and tangible. Statement reconciliation for example, is one of those processes that is typically manual and time intensive. Worse still, a discrepancy between internal systems and supplier statements can result in money sitting in accounts uncollected. It’s always a risk with siloed systems, disconnected spreadsheets, and people-driven processes.
Most modern CFOs will understand that the solution is technology-driven but may be understandably wary of embarking on another IT project that never seems to end, costs a fortune, and doesn’t deliver on the goals. A core part of the Glantus proposition is that it no longer has to be that way, that the transition to becoming a data-driven organisation can be an iterative process that delivers quick wins and a return on investment upfront.
Think business not technology
First, there must be a change in mindset. Implementing data-led solutions must be thought of as a business strategy not an IT project. A new chapter in the way that IT services are delivered and consumed has made it possible to align technology to business goals in a way that was unimaginable a decade ago. This is why C-level executives have enthusiastically embraced the Cloud because it makes IT services simpler and more transparent, liberating their premises from complex systems and legacy hardware.
I speak to many CFOs who welcome the change and relish their role at the heart of it. No longer seen as number-crunching stereotypes, the modern CFO has taken on new responsibilities and become a strategic voice within the organisation. They are increasingly recognised by the rest of the board as instrumental in creating value, with a new-found responsibility in driving business transformation across all areas of the organisation. Data is the key ingredient in making this happen.
The goal for the Finance department should be to transition from siloed paper-based processes to integrated digital insights. This is about liberating people from repetitive, low value, time-consuming tasks and freeing them up to focus on work that is much more valuable to the business. Reducing the dependency on people and paperwork has other benefits, such as increased quality and accuracy through automation, for example, and secure centralised access to organisational data.
The last points are of special interest to CFOs who are on the frontline of a company’s regulatory responsibilities. We find that having a holistic overview of the information that runs the business, based on real-time updates, quickly goes from being aspirational to indispensable. It’s just another reason why CFOs need to reevaluate the way that the company “has always done things.” In terms of compliance alone, the risks of sticking with the status quo are much higher than pursuing a new data strategy, and with it comes tangible value, quickly.
Continuous process improvement
Embracing change is all about future-proofing your business to make sure it stays relevant and competitive. Skills shortages are becoming a common challenge, so the more you can automate and simplify data-driven processes and analytics, the better your chance of maintaining a healthy bottom line. Once you have a business that’s digitally enabled, you’re well on the road and can focus on continuous process improvement to keep making gains.
For most people, it will be reassuring to know that ‘big bang’ implementations are no longer the order of the day. The iterative Glantus approach means minimum disruption to the business, picking off processes, one-by-one, delivering a return and giving the business a successful outcome. In the earlier example of Statement Reconciliation, a laborious manual task can be transformed into a digital process that triggers an automated alert when numbers don’t match up, or even better, resolves the discrepancy without the need for manual intervention. Next up could be something like Procure-to-Pay or other Accounts Payable processes, all based on a common data platform.
This is about quietly getting on with the business of increasing efficiency, turning digital transformation into a silent advance. It’s about migrating one process after another, a journey of milestones rather than a single destination. Further down the track, when legacy processes have been swapped out and the business is digitally enabled, data becomes even more valuable as the CFO begins to explore predictive analytics and machine learning techniques. But that’s another story.
Joe Keating, Chief Data Officer, Glantus