Over the past few years, software companies have been on a journey, helping customers create value for their organizations by applying technology to solve some of their most complex challenges. Now, as technologies such as artificial intelligence, machine learning, the Internet of Things (IoT), advanced analytics, and blockchain become mainstream, companies have the opportunity to enable the workforce to focus on higher-value outcomes. In short, they can evolve to become intelligent enterprises with new capabilities that support their business aspirations.
Welcome to the intelligence era
In the era of the intelligent enterprise, the ability to automate is much more sophisticated than ever before. Whereas historically, we have been able to drive automation through analysis of numbers, today’s intelligent technologies can provide deeper insights based on a greater variety of data sources, such as text, video, and imagery. Furthermore, this automation can be administered far more cost-effectively as new tools make emerging technologies more consumable by embedding intelligence within business processes.
Company growth in the crisis era and related architecture challenges
After the financial crisis of 2008, many companies have grown by acquiring competitors, thereby optimizing their supply chains and expanding into new segments with new customers. Acquisition strategies have also allowed them to optimize asset utilization, resource consumption, and R&D costs and to mitigate and balance operational and financial risks.
However, these acquisitions are pushing companies to rethink their organizational structures, and many are shifting from the “legal entity” approach to the “optimized SBU model.” Instead of a structure where all business processes are shaped in accordance with each legal entity perimeter, they are spreading the business processes of each strategic business unit (SBU) across several legal entities. The objectives of this choice are to:
- Improve customer satisfaction
- Optimize and standardize processes
- Reduce costs
- Provide the proper business flexibility to each SBU
- Improve governance and ownership
- Adopt a common accounting and controlling model
In the figure below, you can see how this model combines finance, HR, and non-strategic procurement functions across three strategic business units, while procurement, sales, logistics, and services continue to be managed in individual business units to maintain adequate flexibility.
Each company has its own history, mission, values, and capabilities, so transformation programs can take a long time. This lag time risks eroding market share, customer loyalty, and brand value, and can contribute to margin compression, organizational conflict, and delays in taking advantage of the latest technologies.
CFOs can take the lead
To revitalize the company’s transformation program, helping guide it away from a “legal entity” organizational model toward an “optimized SBU” structure, CFOs can take the lead in building a new finance platform. With an integrated finance platform built on a digital core, they can quickly reshape, harmonize, and centralize finance and controlling processes with no impact on other business processes. This way, they can demonstrate internally how easy it is today to capitalize on the latest technologies.
In this scenario, CFOs have a great opportunity to transform their own role, becoming a strong partner with their peers to shape long-term business and IT strategy. They can not only execute their daily transaction-focused activities with a high degree of competence but also guide other business units’ strategic decision-making:
- Having strong influence beyond the finance function
- Driving strategic growth initiatives
- Improving efficiency with automation
- Being effective at core finance processes
- Collaborating regularly with business units across the entire company
- Working closely with the GRC team and excelling at handling regulatory change
With an integrated finance platform, the CFO can:
- Increase the accuracy, efficiency, and effectiveness of finance and controlling processes
- Accelerate finance processes innovation while reshaping the internal/external resource balance
- Reduce organizational and technical impacts stemming from M&A
- Enable the company to take the first step towards the intelligent enterprise era, with low business impact
- Reposition his/her role in the company, taking charge of the transformation program, helping their peers in their transformation action plan
For more information, watch these videos:
- The Way to the Future of Finance
- Fast Path to Innovation
- Quick-Start Your Finance Transformation Journey
Why have AI, machine learning, predictive insights, and digital assistants become the must-have new tools of forward-thinking CFOs to drive business performance? Watch the Nov. 6 webcast.