Digital Finance

The finance function is evolving rapidly, and nowhere are the shifting priorities and demands of financial leadership clearer than in a financial leader’s first few months with a new organisation. It is during the first few months that financial leaders absorb their new organisation’s operations and make the first steps toward bridging the gap between where the business is now and where it needs to be to remain competitive in the future.

Digitisation enables the finance function to automate processes and free up finance roles to focus on more value-added, impactful tasks, and digitisation is now a realistic goal for the finance function, because of a range of technological advances. These include the widespread availability of business data, teams’ ability to process large sets of data using now-accessible algorithms and analytic methods and improvements in connectivity tools and platforms, such as sensors and cloud computing.

What are the challenges for a new finance leader in creating a digital finance function?

Nowadays, technology is central to most organisations, and finance function transformation. With the emergence of a new generation of technological tools, resources, and platforms, including the cloud, big data, AI, and robotic process automation, digital finance transformations have the potential to reach more widely, improve performance and deliver more significant benefits.

The use of technology is central to everything we do, both inside and outside of work. Therefore, finance needs to have a clear roadmap for how they see their IT architecture evolving. The roadmap should also look at how teams will interact and change their ways of working to make the workplace a more collaborative environment which enables finance leaders to get the best out of their new technology solutions. However, there can be challenges and obstacles to digitising the finance function.

Obstacle – Overall digital finance vision not clearly defined

Solution: – Bring together representatives from the finance team, your customers and other business representatives in your organisation, to feed into and come up with joint digital vision

Obstacle – Digital finance initiatives not linked to overarching business strategy

Solution – Link specific initiatives to elements of broader corporate strategy, identify linkages in strategy discussions, and monitor outcomes

Obstacle -Not having the skills to support digital finance transformation

Solution – Finance leaders should evolve the digital competencies of their staff to enable them to use the technology at their disposal. Getting a digital transformation partner on-board will help guide the finance function’s digital strategy and create a roadmap for the future.

Obstacle – Backlash within finance function over changes resulting from digitisation initiative

Solution – A strong programme of cultural change is required. Getting employees involved in the process of digitisation early is key to getting buy-in. Establish or redefine employee incentives so they align with digital agenda

Obstacle – Lack of understanding between digital finance teams and departments

Solution – Work in cross-functional squads, integrating various departments perspectives as well as a customer view. Align each department a representative or finance business partner to build this relationship

The lesson for new financial leaders is clear. They should invest in tools that empower their team to participate in the data democracy by giving them access to the information they need when they need it. Below are some of the actions a new finance leader can take to help shape and digitise the finance function.