An effective and efficient finance operations function is central to the smooth functioning of a company. Accounts payable and receivable, working capital, supplier management, expense management, and compliance all need to be harmonized and seamless to ensure optimal business execution.
But a recent global survey of 323 finance executives, carried out by CFO Research in collaboration with SAP, found that most finance executives believe that finance operations staffs will need better information tools and simpler processes in order to unleash their full potential. They say their staffs have to overcome serious obstacles put up by poor processes that create inefficiencies and information systems that are difficult to use.
For example, in the survey a director of finance from a technology company in India writes, “Upgrading the information system has worked the best [for improving finance operations]. It has resulted in faster financial processing power.” At the same time, half of the survey respondents report the need for still more upgrades to systems and processes in order to reap the full value from their skilled finance operations staff.
In fact, despite the investments their companies have already made in technology, three-quarters of the respondents report that their finance operations systems still require a great deal of manual intervention. “Finance performance is negatively impacted by the current out-of-date ERP in place (still from the mid ‘90s),” the controller at a U.S. manufacturing company wrote. “Lack of technology results in rework, duplication of efforts, and a lot of manual processes that are not efficient or effective.”
And a large number of companies appear to be falling short in their consideration of a comprehensive solution set. Only about one in five are looking to expand use of either outsourcing or shared services centers as the means to improving finance operations.
At one Brazilian technology company that has already taken this path, a vice president of finance extols the benefits the company enjoys as a result. Writing about Writing about the shared services capabilities his company had developed, he said, “Everything became more efficient, rapid, and integrated across all BUs.” A vice president in the U.S. wholesale/retail trade also pointed out the enterprise-wide value of a shared services model that he believed “would contribute greatly to success in all areas of the business.”
The right solution, taking advantage of the right technology, can deliver radical results for a company. For example, a vice president at a U.S. financial services firm wrote that “a flexible billing system [would] enable the business to change revenue models to address competitive pressures.” Companies simply can’t afford to overlook finance operations as an new enabler of transformation and driver of success.
Read the full report: Build High-Performing Finance Functions.
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