Our data shows that there’s still a big gap between the expected impact of digital transformation and finance’s level of readiness. But top-performing finance organizations are not waiting around until all the statistics look good; they are pushing ahead with exploration and testing of new tools.
Digital transformation has long been a big issue for the finance organization, and finance executives expect it to have a significant impact on finance performance and service delivery. A full 100% of top-performing finance organizations in our 2017 Digital Transformation Study believe digital transformation will drive improved finance business contribution.
But while 89% of top-performing organizations (vs. 43% of peers) have a digital strategy, finance lags in the ability to execute it. Only 24% of peers say they’re ready, versus 67% of top performers. In our survey, respondents pointed to lack of resources and inadequate internal IT support as key hurdles to closing the execution gap.
While finance has a lot of work to do to up its digital competencies, it’s not sitting idle. Most top performers in our study are already exploring and piloting new technologies across process areas. Where’s the most activity taking place? In digitizing repetitive processes and leveraging digital tools to improve analytics.
- Many finance organizations are putting an emphasis on the digitalization of repetitive processes like cash disbursement and general accounting. Using robotics and artificial intelligence (AI), these finance organizations save time and money and cut down on errors. Repetitive processes are the most popular candidates for digitalization, as finance organizations look to make their account-to-report and customer-to cash processes more efficient.
- Right on the heels is the next wave of digital projects, in planning, performance management and forecasting, and business analysis. Of top-performing finance organizations, 73% are exploring, piloting, or have completed projects in business analysis; 76% are doing the same in planning and performance management. This trend reflects the growing pressure on finance to deliver insight and decision support to business leadership. Finance is beginning to use solutions like Big Data and predictive analytics to show management not just how the business is doing, but how it’s likely to perform in the future, and also coming up with ideas on how to prepare.
Source: Digital Transformation Survey, The Hackett Group 2017
Blazing a trail versus playing catch-up
While finance may lag in matching what’s important and what’s possible, it’s certainly trying to catch up. Peers are quite behind and will have to play quick catch-up to match top performers on everything from developing a digital strategy to trying out new tools. Still, that top performers are ahead is good news. They are blazing a trail for peers to follow. They realize the effectiveness and efficiency promise of digital transformation.
By imagining multiple destinies and working back to the present, companies can prepare for anything. That’s Why Strategic Plans Need Multiple Futures.