Three Characteristics Of Intelligent Finance

Olivia Berkman

FEI Daily spoke with Jim Enzor, a former CFO and current managing director at Accenture, about the data, disruption, and talent challenges CFOs are facing along the transformation journey.

FEI Daily: The report outlines three main characteristics of the intelligent finance function, one being harnessing the power of data. What are the challenges today’s CFOs face when it comes to data?

Jim Enzor: Data often stands in the way of a CFO making the step towards transformation. Getting the data right is always very difficult for a lot of reasons: acquisitions, the implementation of tools, and as you look across regions, different business units that approach the business differently. That is a big, big challenge.

In the past, CFOs have tried to boil the ocean. They try to go in and fix all of the data issues and try to get the organizational aligned. And what’s probably more powerful is to fix the data that you need to fix, find a way to automate your approach, and then fix it as you go. So, you’ll have an option to go into your master data files and correct it. Or, with the machine learning, you’re able to create the report, create the analysis the right way, without having to necessarily go and fix it at the source.

FEI Daily: Another characteristic is leading with new digital technologies. We hear about AI, machine learning, blockchain. Can you give real-life examples of these technologies being used in the finance function?

Enzor: We have a four-step process for transformation. The first step is building the foundation. The second is automation. The third is introducing the analytics, and the fourth is introducing artificial intelligence.

You really have to approach it in those four steps to get the real power of analytics and artificial intelligence. I’ll give you an example: Travel and expense. We all travel, we all have expenses, and we have to put our expense reports in. If you don’t have policies in place, if you don’t have policies that are enforced, policies that are communicated, it’s really hard to then try to use artificial intelligence to drive any improvement. The first step is to mature the process. And now that we’ve matured the process, and people are following it accordingly, now you can start to talk about automating.

There are lots of tools out there for automating the T&E reporting process. Now that I’ve got a well-documented process and a policy that’s in place, now I have data that I can start to analyze. I can look across my organization and see where I have potential issues. I might have people that are noncompliant. I can actually view 100% audit of all of the reports by evaluating the reports against that pool of data. And then I can actually start to look outside of my own data, and bring in external data that starts to look at the cost of a night in New York City, for example. How much should it cost to travel from this location to another location using Uber?

When I start to bring in that external data, it helps inform where I may have potential opportunities to change my policy. I may have potential fraud. I may have people who are taking advantage of the system.

FEI Daily: What about developing future F&A talent? Tell me about the new generation of finance leaders. What skill sets are they bringing to the table? How are CFOs keeping these employees happy? 

Enzor: I think about finance in eight steps. Five of those steps are more transactional in nature: accounting, controlling, handling compliance, and reporting. Those five steps are kind of the basics of finance. And we’re trying to digitize those five elements of finance, and identify where there are exceptions, focus expert talent on those exceptions, and address them and continue to drive that into a digital environment. What does that do? It allows more time to focus on the other three aspects of finance that are critically important. These are the areas where I have more time, more capability to truly drive enterprise value. Those three areas are the planning process, the analyzing process, and the advising process.

Today, resources are really focused on those first five: the blocking and tackling. And what I need to do now is move my organization, so that employees have those analytic capabilities, so that they understand the impact of planning and holding the organization to account, and they can truly be in a position to advise. So, I have to understand the business to partner with my operating leadership. I have to be able to bring insights from the data and translate those insights to impact the operation.

In the future, I’m going to need data scientists, people who understand big data and how to manipulate and use it. Then I need people who can truly partner in the business, which requires some leadership skills. It requires an understanding of finance and how finance can impact the business. It also requires an understanding of the industry that I’m working in. Those are the future finance leaders who are going to make a difference.

FEI Daily: And how companies are keeping them happy and engaged?

Enzor: I think about the business as being split between rules-based activity, “If this, then this,” and the parts of the business that require me to think, “I’ve got to make a decision, evaluate some circumstances, and make a choice.” I call that the brain-based decision. Then I think about leveraging technology versus manual workforce labor. For the things that are rules-based, I’m trying to digitize and drive automation, and leverage robotic process automation for those processes. And by doing that, you’re building a skill for people to try to find those opportunities that deploy that robotic process automation. That’s creating a very interesting environment.

Now I’ve developed an environment where we’ve got a very interested, engaged workforce, who understand the business. Now you can think about the career path that takes you to the planning, analyzing, and advising role within the organization.

It’s not the old, mundane, “I’m going to be doing accounts payable for the rest of my life.” It’s talking about how you’re going to become active in the business, drive digitalization, drive automation, become an expert in the workforce, and ultimately become a senior leader.

This article originally appeared in FEI Daily and is republished by permission.

Olivia Berkman

About Olivia Berkman

Olivia Berkman is the managing editor of FEI Daily, Financial Executives International’s daily newsletter delivering financial, business, and management news, trends, and strategies.