The finance function of the future: from “fixers” to “pioneers”
  • Svilena Tzekova, Partner |
5 min read

Finance functions are increasingly under pressure to deliver fast, reliable, digitally enabled insights that support decision making and drive business outcomes. All that, alongside the traditional roles that Finance is expected to perform. In fact, more than 70 percent of the work I do is about redefining the role of finance to meet the expectations of the business and connect stakeholders across the enterprise.

Digital transformation is undoubtedly a powerful tool to help Finance deliver against the business expectations in our new reality, but is it as easy as just putting in a new technology and hoping for the best?  To try and answer this question, we held a panel session as part of the recent Our Digital Future event.

I was joined by some fantastic speakers:

  • Mike Clark – Vice President, Enterprise performance management, Coca-Cola European Partners
  • Anita Andric – CFO Microsoft Switzerland and Global Lead of Microsoft’s Forecast Simplification project
  • Larry Gundrum – Global Head of Technical Design and Architecture, Willis Towers Watson
  • Paddy Parke – Pattern and Finance Technology Lead, KPMG in the UK

There were lots of interesting points raised, here are some of my key takeaways from the session that I’d like to share.

Connected and in the cloud

Finance functions need to embrace technologies that drive innovation and productivity while delivering information for fast decision-making. But to do this well, Finance needs to connect seamlessly to all functions in the business - from the front to the middle and back office. I describe this as convergence of the functions, all working together to drive business performance.

As a panel, we all agreed that one of the fastest ways to accelerate to this level of seamless integration is to adopt cloud technology and adapt to the ways of working that the platform offers. Larry said this was an approach he took during a complex transformation at Willis Towers Watson, as “with cloud products, a lot of the best practices are built into the technology.”

Clean data is key

Clean, reliable data is a foundational step to a successful digital transformation in Finance and the broader enterprise. But as Mike reflected, we can all find it one of the least exciting things to work on and engage with; “…it's often hard work, but there's no substitute for doing it,” he said.

Mike shared the following helpful tips on getting the data basics right:

  • Make sure data is made available automatically and on a timely basis
  • Have consistent definitions of KPIs across the business
  • Enable access for the right people, at the right time
  • Understand what business questions need to be answered

A comment from Mike that stood out for me was that while “data democratisation” (making data widely accessible across an organisation) has many positives, ownership of the decision making needs to be well defined. This will avoid inconsistencies in interpretation and application of the data sources.

Automation : removing the bias and improving the experience

I was not surprised that the power of automation came through as a strong theme in the discussion. Digital transformation is often associated with the benefit of removing repetitious, manual, non-value adding work. But in addition to that – it was exciting to hear that there is more to automation – as better insights emerged and the overall experiences of those responsible for running a process, as well as those at the receiving end improved.

Anita shared her learnings from a programme she ran at Microsoft to bring automation and machine learning to the forecasting process. For a while, after the new process was launched, Finance continued to run the old manual forecasting process alongside the new digital process, utilizing machine learning technology. Without fail, the new process produced more accurate forecasts and removed bias. But there is still a role for the Finance function - Anita describes the current situation as a merger of “human and machine learning input that generates real insights”.

At Willis Towers Watson, Larry described their digital transformation in Finance as largely focused on record-to-report, procure-to-pay, and contract-to-cash processes, but with a focus on improving the experience of both staff and clients along the way. Larry called out some tangible outcomes as processes were automated:

  • A move from manual to fully automated end-to-end billing processes, and on-demand billing
  • An improvement in cash flow by decreasing days of sales outstanding from 75 days to around 45 days
  • Clearer visibility over client profitability and better pricing decisions as a result of the enhanced analysis of bill rates, discounts and trends over time

Most importantly though, the process automation has created a much better experience for the clients, as well as the staff associated with running these processes.

Overcoming barriers

Our panel was in agreement that while there are many benefits to digital transformation, there are inevitably barriers to face along the way. This was reflected in an audience poll during our discussion:

Paddy made a good point that to overcome the hurdles, clarity about the objectives and priorities is key. This informs the operating model across all functions, and critically helps define the skill sets as well as cultural and organisational changes that need to be considered.

Larry emphasized the importance of visible and vocal support from senior leadership. He said that digital transformations rely so much on people engagement at all levels, so leadership needs to drive a clear change programme to bring people along on the journey.

In summary:

For Finance to meet the expectations of the business in an ever changing and fast paced world, digital transformation undertakings are a key enabler. For these programmes to land well, key lessons learned include:

 

  • Understand what the business is looking to achieve, what questions need to be answered and align the transformation programme to these priorities
  • Clean, consistent data is essential to success
  • Automation can improve both efficiency and effectiveness of the process, as well as improve the experience of those involved in it
  • Cloud technology offers faster path to the new operating model and access to best practices codified in the technology platform