Finance processes need more than just new tech: they need a rethink

The pandemic has been a pivotal moment for finance teams. Under intense pressure, COVID-19 forced leaders to adapt – fast. But now, we’re at a crossroads. The technology that enabled us to balance the books whilst working from home is embedded, and working well. However, we’re now facing the prospect of heading back into the office – so what happens next?  

The answer lies in reviewing the building blocks of your finance team. It’s critical that we do more than just plug in new technologies and hope for the best. It’s about fundamentally changing how the finance team runs, works, and succeeds, to ready your business for the future. After all, the cost of not rethinking the ways you do finance could be too great.  

Embedding new technology 

A recent Oracle study found 87% of business leaders believe the risks that come from not rethinking finance processes include falling behind the competition, being more stressed, inaccurate reporting and reduced employee productivity.  

The pandemic has already shown this to an extent. For companies who had already embraced cloud, the past year has been about hard work and great collaboration. For those still working with on-premise and legacy technologies, it’s been about work spilling over into the weekends, a lack of clarity, and a constant barrage of mismatched transactions and data creating more problems than solutions.  

We’re seeing a wave of investment into AI and robotic process automation, as more leaders accept that these new technologies represent the way forward. But these technologies should not be introduced to secure one-off cash savings. To reap their benefits, and sustain them, they should be embedded into core financials – simply becoming the new ways of finance. Doing this properly puts such technology to work; allowing algorithms to learn from behaviours, to pre-empt and predict. This also enables finance leaders to manage risk more robustly and identify trends more readily.  

Tidying up your data 

At the crux of every finance process is data – ideally a single-view of data. This is the holy grail for many finance organisations, providing everything needs to report objectively, efficiently and responsibly. But achieving and sustaining a clear data set can be especially problematic as a company grows, either organically or through acquisitions. When this happens, businesses can find themselves with a labyrinth of finance systems and processes resulting in complexity and unreconciled data. All too often, this doesn’t get tidied up – and hybrid working environments only complicate matters further. 

Moving to cloud and having a single chart of accounts removes overlaps, gaps or mismatches in data. This allows finance teams to focus their time on analysing what the data is actually telling them, rather than wasting time sorting out what the numbers are in the first place.  Finance can, therefore, generate better insights to inform the business and to advise the boardroom on options available, and recommending optimum courses of action. This is a role reversal from the finance processes of yesterday – where number-crunching was the primary order of every day, especially for junior team members. Now, it’s all about finance deriving insights, demonstrating understanding, and influencing decision-making.  

Future forward 

Failing to rethink your financial processes means failing to prepare for the future – but this goes far beyond solving day-to-day inefficiencies or even balancing the books. The future is focused on several key areas, one of which is ESG – the expectation that businesses take a multi-stakeholder view on their impact across the dimensions of Environment, Society and Governance. So far, so not really for finance – or so you might think. But in reality, as stewards of an organisation’s data, we as finance professionals must take responsibility for reporting against the ESG agenda; and, by association leading on promoting its adoption across the organisation.  

Reporting ESG requires a joined-up approach between financial and non-financial data – for example to demonstrate where investment is consistent with fair treatment of workers, demonstrating that materials are sourced sustainably, and showing how they are moving away from fossil fuels. With the expectation that more regulation related to ESG is coming, finance needs to not be caught off guard – this requires constant access to the underpinning data, the ability to quickly and repeatedly analyse it and support prompt decision-making off the back of it. Again, this is something new for finance teams. But it will be absolutely vital to every business’ future. 

Finance teams have taken huge steps over the past year to digitise, but innovation mustn’t stop there. Technologies that help us make better use of our data will allow us to find and create the most value for the whole business – whether that’s managing risk and understanding trends more efficiently, or accurately reporting against ESG standards. The finance role is evolving, and we mustn’t play catch up. New technologies can help us stay ahead.