Finance leaders globally are recognizing the importance of breaking financial functions out of silos to operate more collaboratively across businesses. A study from Oxford Economics showed that CFOs who work closely with other lines of business, such as marketing, sales, R&D, and customer service, achieve greater revenue growth and better alignment with their business goals.
To achieve better collaboration across the business, financial leaders acknowledge the value of new technologies such as cloud-based applications, data analytics, and machine learning. These intelligent technologies have the potential to automate back-end operations, modernizing rigid legacy systems while driving efficiency across these business functions.
According to the study, 73% of financial leaders agreed that automation provides the finance function’s efficiency at their company while 97% of finance leaders view enterprise resource planning (ERP) platforms as vital to successful financial performance. These intelligent technologies automate and optimize labor-intensive processes to save money, organize data, improve data visibility, enhance compliance, and improve efficiency. Automation of repeatable tasks also means these functions no longer require human oversight to ensure quality, which means CFOs can reallocate talent to more value-adding or innovative tasks within the business.
For example, chemical company BASF Group increased payment and invoice-matching process efficiency from 40% and 94% using machine learning. The CIO at BASF Group, Wiebe van der Horst, highlighted how cloud-based platforms have had a positive impact on both front-end operations (sales) and back-end functions (accounting). “This is fully integrated into our ERP landscape and works like a charm,” he added.
Mr. van der Horst noted that machine learning exponentially develops alongside the business. The longer this technology in use, the better attuned it gets to the BASF Group’s present and future needs.
Clearly, the time to incorporate intelligent technologies is now. Digitalizing a company’s financial function, rather than another line of business, is a good introduction, as there is a large amount of methodical data produced that is often collated within context. Furthermore, the processes and outcomes can be quarantined to the finance function, which will quarantine risks to wider operations as compared with other lines of business.
Faster closing, planning, and analysis
By incorporating intelligent processes and technologies, CFOs can simplify their data structures to enable easier and faster closing, planning, and analysis. Swiss RE, a wholesale provider of insurance-based solutions, understands the importance of modernizing finance technology while abiding by the increasingly complex demands of regulators and other stakeholders.
New technologies handle critical, resource-intensive tasks more quickly and accurately than humans, reducing both time and risk, which gives CFOs peace of mind and the freedom to focus on more value-adding functions. According to Ventana Research, one-third of the repetitive and rule-driven work done by financial teams can be eliminated with machine learning, artificial intelligence, and blockchain automation.
With the increasing need for CFOs to take greater responsibility for a companies’ strategic direction, intelligent technology can facilitate this change as new solutions free up their time and attention. Technology is changing at an exponential rate. CFOs should start working smarter, not harder, and they should start today.
For deeper insight on How Finance Leadership Pays Off, download the Oxford Economics study.