In the digital age, what does the future of finance leadership look like?
Today’s CFOs are on high alert, as they need to reimagine their role in direct response to digital disruption, ever-increasing volumes of data, closer stakeholder scrutiny, and ongoing regulatory change. CFOs must use this moment to design a future state for the finance function and define technology’s role within it.
It’s widely acknowledged that automation — made possible by the cloud and machine learning, in particular — will eliminate many rote tasks that finance staff currently spend much of their time performing. Account reconciliations, which are often done using spreadsheets, can already be performed automatically in the cloud. In the near future, it’s expected that intelligent process automation can automate the entire financial close, making it an ongoing process where staff only intervenes to manage exceptions.
Does this mean that accounting jobs will soon become obsolete?
In our work with professional bodies such as the Chartered Institute of Management Accountants (CIMA), we’ve found that — while certain tasks will be eliminated — finance professionals with the right skill sets will be needed more than ever.
“The historical, transactional part of finance is really a commodity, not a competitive advantage,” said CIMA vice president Nick Jackson in a recent webcast. “Part of the investment CFOs should be making is in real-time data, and the other part is in real-time analytics.”
Jackson stressed the value of real-time data as a strategic asset, one that finance professionals can understand and analyse to get answers to the organization’s most important questions.
“Data alone cannot solve our problems, no matter how good we get at automating and cleaning it. The finance department is perfectly placed to be the human interface needed to make this process work properly.”
Because of their training with numbers and mathematical formulae, finance professionals are perfectly positioned to be the “human interface” that interprets the data, makes recommendations, and guides the business forward on its next strategic step. Rather than being made redundant by technology, the explosive growth of data puts the analytical skills of finance professionals at a premium.
“There’s always another question to ask,” said Jackson. “It’s evolving the finance function as a business partner role, to interpret what drives the insight from the number that comes out from the report, to what is actually happening within the part of the organisation it relates to.
“I believe finance leaders will become change agents for the business,” he adds. “With the tools and people in place, the next key component for driving effective change is how you manage the business data that results.”
The ability to effectively manage real-data is where the cloud becomes essential. By leveraging a shared data model across cloud systems — including finance, HR, supply chain and customer experience — organizations gain a single source of truth across the organization, and can build a reliable view of each customer. Once established, a connected cloud delivers innovation across the enterprise on a continuous basis, with new capabilities and best practices rolled out regularly by the cloud provider.
This continuous innovation is one of the key benefits of cloud. In a recent Oracle survey, a whopping 85% of respondents cited “Staying current on technology” as the top benefit of finance in the cloud. Leveraging new technology (such as machine learning) to automate and scale people-intensive processes and create new services is much easier when you have immediate access to these capabilities as they evolve.
As with any transformation, however, it’s not just about technology. When considering the future of your finance organization, you must consider it hand-in-glove with your organization’s business strategy. Look at the goals of the business first; identify where your organization wants to go, and what skills your finance team will need to support that journey. Then identify the tools, technologies and processes that will help give finance the right answers — as well as automate as many rote tasks as possible, so that your people have more time to focus on what really matters.