• Patrick Fenton, Leadership |

As organizations around the globe found themselves upended by the pandemic and the pace of digital transformation that followed, the finance function was often the first to feel the pinch. This ‘financial heart’ of the business was seeing the real effects of change before many of its counterparts, and in turn, had to rapidly manage either disruptive business growth or catastrophic revenue decline.

Not all finance functions were ready for this accelerated world; those best positioned have been those that are digitally enabled. To be future-fit – that is, ready to react, control and support – finance itself often requires a transformation. Finance must develop a world-class service and the technology-enabled backbone to drive value across the entire enterprise. We’ll consider here how to make that happen, and why it matters.

The low-hanging fruit of change

Let us first consider how the finance function can be transformed and optimized. Consider that the time could not be more right for making the best use of technology that is rapidly advancing. Look first at automation. If systems and services within the finance function can be automated and machine learning introduced to support staff, this will bring greater efficiency, new insights and better resilience. Next, seize the digital opportunity to gather and learn from data. This is more than just collecting data, it’s about focusing on the analytics, interpreting the output and predicting which moves you need to make to achieve the business strategy.

If finance leaders can tell that data story, then the C-suite can make better, more informed decisions. Put simply, finance uses its data and technology to become a change-agent, not just a number cruncher.

At KPMG we strongly believe that introducing technology should be about more than just the tech – it’s about business outcomes. And this is where we draw our second bow – in order to optimize, finance needs to reset its operating model. If it focuses only on the tech, the bigger organizational picture may be missed or ignored; but if finance transforms with a new target operating model that considers people, governance and service delivery among other pillars, then it will keep a true business focus and can deliver on transformation goals. Technology is still a vital component but is just one of many vital cogs in a fresh, highly performing finance function.

The trickle effect – spreading the impact for greater benefit

The benefits we’ve covered so far begin to address the ‘so-what’ of transforming finance, but the good news is, there are even more advantages to come.

With the introduction of a new operating model, such as that brought to the table by KPMG Powered Enterprise, and the integral use of technology and data, finance staff have the time and know-how to be more strategic. Teams will have the newfound capacity and skills to actually understand and analyse the aforementioned data, and this in turn is game-changing for the business. Further, where people are valued and feel crucial to the future, staff retention is a natural and welcome consequence. And when finance staff see that they’re part of an interesting and challenging future, this has positive repercussions for organizational culture, resource management and cost.

So in fact, we’re confident that when the structure, technology and people of finance are right, this function becomes a critically strategic component of the business.

Impetus for wider change

Finally, to go one step farther (and to slightly adapt a well-known ballad), if you lead, they will follow. A finance transformation will not only improve business growth, it’s likely to also be an impetus for wider, cross-functional change. Once finance has shown it has sponsorship and commitment to make a change, other functions will pick up the torch. Finance can lead the way and be the flag bearer for a stronger future.

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