Part 3 in the 4-part Finance and IT Collaboration series
Automation is already reshaping the future of work in the finance function, and the opportunity to boost performance is fueling the trend. A report from McKinsey & Company states that currently available technologies can fully automate 42% of finance activities and mostly automate another 19% using software robotics and advanced cognitive-automation technologies, like machine-learning algorithms and natural-language tools.
Tech-savvy CFOs who are considering automation to propel a new wave of efficiency and performance will be well-positioned to thrive. The finance organization at SAP has been undergoing a transformation for the past several years, enabled by the guidance of our IT team and SAP technology. We often use our own organizational processes as an example to others of how a best-run business can thrive in the digital era. Here are some of the top ways we’re using technology to get ahead.
Automation at SAP
Automated workflow is a big part of what we do in finance. We have a lot of processes that are governed by delegations of authority, which means that different people review and approve tasks in certain orders. When I first joined SAP, we all sat behind our computers working a GAF system for commercial deal reviews that was neither flexible nor mobile-enabled. Now we have applications that work on our phones and tablets, notification emails when we own a task, and transparency well in advance into what approvals are coming our way. The whole process is so much more efficient and transparent and gives us the agility to plan ahead and work on the move. It has made a huge difference for our team’s productivity.
To a large extent, we have centralized our analytical capabilities in an Enterprise Analytics Group. We now have access to standard reports based on SAP analytics technology and the SAP Cloud Platform that bring together key metrics and data and help ensure consistency in the way we steer the business. This allows our people to make decisions faster across the company. Rather than ask IT for support or do it ourselves, the reports are readily available so we can immediately use the information to better manage the business. That’s another big productivity gain for us.
Machine learning in the shared-services organization
We are looking at ways to use machine learning to further streamline our processes. For example, IT is currently running cash-matching trials that we’ll build into our shared services environment. That’s going to be the next horizon of automation becoming mainstream in the coming years.
We’re looking at how to match our bank receipts to customer invoices. This typically requires an intensive manual effort simply because of the unstructured nature of the data involved in the process. It becomes more complicated when there are partial payments, multiple invoices are issued simultaneously, different currencies are involved, and so on.
We’ve taken a process that was very manual, applied machine intelligence to it, and now have over 65% success rate on the matches. This automation alleviates a good deal of the workload for simpler tasks, enabling the people in finance to better use their time.
Travel and expense management
Everyone knows the traditional way to process travel and entertainment expenses. People make copies of receipts, scan them, package them up, and submit them for reimbursement. The whole process is time-consuming and manual and, quite frankly, pretty tedious for everyone involved. To automate travel and expense management, we implemented solutions from SAP Concur and coupled them with some policy changes in the finance organization. By automating each phase of travel – such as preapprovals, booking travel, reimbursement, analysis, and expense reporting – the whole process is much more streamlined and efficient.
For example, Concur Expense automatically facilitates compliance by linking to our preferred hotels and airlines, including online travel booking sites. The solution populates expense claims using electronic receipts from those suppliers without requiring employees to capture an image of a receipt or enter expenses manually.
With rigorous T&E processes that are easy to use, our employees are more likely to plan ahead and comply with policy – and in so doing, realize the macro- and micro-level benefits that can have a positive impact on business performance.
Dedication to ongoing improvement
These projects are not the end goal for us. They’re just a starting point to explore what new technology can do for us across the company. Every routine task that we can automate gives us the ability to scale our operations and keep pace with the growing demands of our business – and that has a significant impact on performance.
Read the next post in this series on April 30 to see how finance is pairing up with IT to set an example of how to be a purpose-led organization.
Read why finance leaders are pioneers in using technology in the infographic “Next-Gen Finance Solutions.”