Blog 2 of 2 from the CFO of ZALORA, part of the Digital CFO Series,.
As a five-year old startup in the fashion e-commerce business, ZALORA Group understands that change is the only constant. Our initial regional operations across multiple countries in Southeast Asia have evolved into a unified corporation with headquarters in Singapore and a shared services organization and consolidated warehouse in Malaysia.
As I wrote in my previous blog, business growth and maturing expectations have helped ZALORA to focus on business transformation under the guidance of our finance organization. But how can other CFOs know when to make this transition, how to use digital technology to support change, and what role the finance team should play in the transformation?
Choose the right moment and manage change carefully
Deciding when to launch a transformation requires good timing and sensitivity. At ZALORA, one of our biggest goals was to enhance performance management. We wanted to ensure that the finance team established the right environment for the organization to drive performance. We also needed finance to play an active role in driving business results and being responsible for achieving them.
Early on, we lacked the business data needed to make this goal a reality. As we began to deploy analytics and other tools, our financial information became more current, accurate, and useful. For the first time, decision-makers could see category, country, and business model performance, as well as historical data, target thresholds, and margins in an interactive manner.
Even then, people needed to become accustomed to using the tools and the data that they produced. Becoming a more performance-oriented organization isn’t a goal that can be achieved overnight. Instead, we see it as an evolutionary process, where we guide team members into looking at data and business results in a new way.
Deploy the right digital technology
Another common concern is how to use digital technology to support a transformation initiative. A recent Oxford Economics study reported that 75% of finance professionals are using digital tools to enhance the performance of the finance function. ZALORA’s business intelligence team is no different. They use several data visualization tools to bring information to life. They are also experimenting with dashboard solutions that can help executives quickly dig through data from our data warehouse.
Instead of the previously used static spreadsheets, users now have granular data that can be used to drive business results. And it’s not only the management who use these dashboards. Merchandise buyers can display daily, weekly, or monthly information about everything from operational data to gross margins and targets. All the information comes from the same database, making it a single source of truth for our operational management reporting.
Considering the vast complexity of our operations—with our different business models, huge number of categories, and operations in multiple countries—we could not have made this change without using digital technology. Our technology adoption rates have been phenomenal, and we’re very pleased with the results so far. You know you are on the right path when the category director starts her Monday morning looking into the dashboards that the team has developed.
Build for the future
Technology will also help finance play an active role in shaping ZALORA’s future. As we make the transition from our focus on increased efficiency, my team will investigate using new technologies to help finance add value to the business and support innovation.
For example, artificial intelligence and machine learning may help us streamline formerly manual tasks such as invoice reconciliation. We may also use predictive modeling to support finance and business decision-making.
With the huge volumes of data and the fast pace of the fashion industry, ZALORA needs instant insights. Having all this technology available—plus new innovations still to come—will help us understand, make decisions, and take action faster as a business.
I often say that business transformation is not a once-and-done project. It’s important to remain as flexible as possible during the transformation, because your plans will develop and shift over time. Yet with our finance background and the expertise of our leaders, I feel sure that our finance team can be instrumental in leading the way to ZALORA’s long-term success. Are you ready to lead your business into the future?
To learn more about ZALORA’s business transformation, read “Steady Leadership Through Transformational Change at ZALORA.” For more information on how ZALORA works with SAP, read about finance solutions at www.sap.com/cfo.