Research shows that CFOs leading new technology initiatives are optimistic about the future of finance and are working to modernise their finance teams.
The Advanced Business Trends Survey found that 64% of finance professionals saw their companies roll out new technology over the last 12 months. These shifts in the ideals of finance also uncovered a further 91% agreeing that the speed of implementation increased because the technology adopted was more user and design-friendly.
On the other hand, we found that 70% of finance professionals continue to have limitations in their current technology which limits when working remotely. Fear of the unknown, unfamiliar or unresearched, could very easily be holding back these finance teams in the dark ages.
So, what is holding CFOs back from modernising their finance function?
Over a third of respondents claimed that disruption to staff productivity is the main thing that would hold them back from adopting new tech. However, 91% of finance professionals agreed that the speed of implementation of new technology increased because the technology adopted was more user and design-friendly.
With the benefits of digital transformation including cash flow optimisation, automated real-time reporting, decision-making agility, and increased workplace productivity, the gap between early adopters and late adopters will widen. Over time, this will bring significant competitive advantages to those organisations with a technologically skilled CFO and modern finance team.
What is modern finance?
In modern finance, the goal is to automate mundane, repetitive finance and accounting processes and adopt best practices for increased efficiency. It means changing how finance creates an impact across all departments. Rather than handling transactional activities, today's CFO focuses on providing strategic insight that helps drive better business decisions.
With Cloud accounting software, modern finance teams can automate and enhance control and visibility over mission-critical accounting and finance processes, so that they have more time to:
Develop a wider business perspective
The modern finance function can dig deeper and gain a broader understanding of business processes and patterns. The automation of time-consuming manual processes has allowed finance teams to focus more on strategic tasks such as cash flow management and forecasting to influence business decisions.
Analyse data instead of manually entering it
Finance teams can focus on analysing information and creating knowledge rather than collecting data. When it comes to account reconciliations, for example, the Cloud helps identify discrepancies by gathering information from all sources, such as ERP systems, bank files, and bank statements. The finance team can then focus on analysing discrepancies instead of performing reconciliations by hand.
Partner with other departments
The responsibilities of the CFO have evolved into a more collaborative role requiring greater communication in modern finance through the implementation of Cloud technology. Therefore, it makes sense for finance teams to work with colleagues from other departments, like marketing and IT. Relationship-building across departments enhances collaboration, smooths processes, and gives practitioners more influence.
How to improve the modern finance experience
For many years, the CFO was generally responsible for reviewing and organizing financial statements, reports, and other information to present to the rest of the management, the board, and the company at large.
As a result of the pandemic's ripple effect, digital transformation accelerated as a necessary component for both operational efficiency and competitive advantage in the last 18 months. The role of the CFO therefore rapidly evolved overnight to address the changing nature of finance and business demand.
Among the benefits of digital transformation are enhanced cash flow, automated real-time reporting, and decision-making agility. The gap between early and late adopters will widen as a result.
To lead their finance teams into the brave new world of modern finance, CFOs must consider essential management strategies.
Your role is changing, so understand it
CFOs today require new skills and tools to take their finance departments into the digital age. A successful CFO should be able to integrate their financial goals with their organization’s overall business strategy. This involves collating and analysing financial data to help drive organizational improvements through process optimization, performance management, and pursuing opportunities to cut costs while increasing value.
The ability to adjust your own sails will help you steer your fleet to waters rich with opportunities for growth, strategic development, and competitive advantage.
Review what changes are necessary
It takes clear knowledge of where you are, what you're doing right, and what you need to change in order to build a modern finance function that is more successful and value-driven.
CFOs should assess what changes are necessary to shift finance further into value creation and organization support. This includes addressing challenges associated with making these changes along with the required resources and business processes to make them happen.
Adopt digital transformation
To address the opportunities and disruptors that define business today, you need access to tools and technologies that transform big data into actionable insights, optimized business processes, and profitability.
Your finance department has a direct impact on every part of your business. Everything else in the business depends on a well-organized finance department, from obtaining essential raw materials and finished goods to securing funding sources for strategic goals like capital investments.
In the Cloud, data analytics and metrics can reveal new opportunities for supply chain optimisation, asset allocation, and strategic development, turning key suppliers into trusted business partners.
Analysis and process automation are natural partners for identifying and reducing risk. To manage risk for their organisations, modern finance teams can leverage digital transformation to provide immediate and demonstrable value.
Automation and analytics powered by AI are the first step toward optimising and modernising your finance function. As a result, it enables your financial planning to align with your organisational goals and drive digital transformation - as well as major gains in productivity, efficiency, and profitability across your entire business.
Facilitate modern finance strategies
Financial managers of tomorrow will need to have a wide range of skills across business units as well as strong human resource and conflict resolution skills, as well as a detailed understanding of business strategy.
In order for the finance function to adopt new roles and skills, you must offer both support and instruction. Consider empowering your finance staff with ongoing education in financial management and skills training.
Automating financial planning and forecasting will free up your team's time and talents to focus on more strategically valuable tasks. Your company's financial performance data can help you improve your balance sheet, guide new business decisions, and inform new business strategies, so be sure they have the expertise and tools to leverage analytics effectively.
What to look for in a modern finance company
With 62% of finance professionals’ biggest priority being business growth and development, it comes as no surprise that fresh approaches, technical understanding and Cloud adoption are the three key components to look for in a modern finance team.
Today's modern finance teams are focused on much more than just maintaining liquidity, budgeting or increasing returns on investment (ROI). They are now in fact recalibrating their expectations concerning such a return.
The priority remains cost savings, but modern finance teams are also interested in proactive cash flow management, generating value from smart investments and integrating performance management with financial management. Located at the heart of their organisations, finance staff use new technologies, such as Cloud accounting software, to optimise business processes and drive value across the board.
Increasingly, CFOs are cooperating with CEOs and senior management to guide their organizations' strategic and financial futures, as their roles continue to grow in strategic importance and influence.
In a nutshell, today's CFOs are setting the stage for a future where modern finance is not just about driving operational success, but also providing strategic guidance and lasting value to the organisations they serve.
“We cannot underestimate the power of Cloud technology in elevating the role of the modern finance department. A sophisticated and intuitive finance management system can automate many tasks, allowing finance teams to provide value-add analysis. The right technology can even strengthen the relationship between the CFO and CEO, whereby the CFO acts as the CEO’s ‘sounding board’.
It is a role that is becoming more significant as technology brings ever greater levels of understanding and insight. Now is the time for the finance department to invest in technology - or risk being left behind.” – Andrew Hicks > CFO, Advanced
Engage modern finance processes
It’s clear that the shift to modern finance processes will determine tomorrow's success.
In the same way that a CFO sets the course for finance, an optimally run and managed finance department can drive your business to new heights of success through improvements in efficiency, financial performance, and competitive advantage thanks to Cloud technology adoption.
Cloud Financials accounting software is here to help your finance function reach the potential to become a strategic and value-driven powerhouse for your company today -- and prepare it to achieve even greater success in the years to come. Get in touch with our team today to learn more about how Advanced can help.