Legacy systems and manual processes prevent CFOs from leveraging the wealth of data about their organizations’ operations and outputs.
A business function that stands to benefit the most from digitalization is finance. The finance chief must adapt swiftly to changing circumstances, make decisions within multiple timeframes, and improve efficiency. Nevertheless, legacy systems impede many companies from completing their daily tasks seamlessly.
It is for these reasons that finance leaders are making digitization a priority. Improved performance, identifying business opportunities, and remaining competitive are all hindered by outdated technology and unreliable data processes.
However, digitization requires more than just technology adoption – it also requires cultural and organizational changes to ensure the right people are in the right places. Leadership teams must bring data-driven growth agendas together so the company is able to scale in an agile and sustainable way.
The end of manual processes
Many companies still manage their data manually in a spreadsheet, despite relying heavily on data aggregation and analysis in finance. A recent study found that 88% of spreadsheets in field audits contained errors. Spreadsheets are the “preferred technology” for companies supporting a broad range of planning processes.
Changing your workforce
The top investment plan for the future of work is digital transformation, which reminds us that technology and people are inextricably linked. Our partner’s centralized digital ERP enabled us to identify and correct errors immediately. Because all relevant information is accessible through a single system, the company’s new data management strategy requires significant cultural and organizational changes.
Cultural change is essential to the success of any digital transformation. A centralized ERP system, for example, needs to be used by employees and managers properly. By analyzing price shifts and incorporating those changes into the relevant terms and conditions, our partner, for instance, can now make predictions based on year-over-year changes. Data-driven predictions allow the finance team to avoid sudden changes in delivery schedules, costs, and other critical changes that could undermine supplier and partner trust. As a result, rebate income and margins are more transparent, cash collection is centralized and streamlined, and deal performance is better understood. As a result, it can negotiate more advantageous deals for both parties.
Taking a proactive approach
In addition to fiscal discipline and tracking how resources are being allocated, CFOs are becoming proactive regarding strategic planning. As a result, companies now have greater visibility into costs, efficiency, and quality of services due to the rise in demand for clean, reliable, and focused data.
Effective CFOs use data to diagnose problems and determine how to resolve them. Access to more details about the company’s operations and outputs has never been easier. The company recognizes that this information is essential for a more agile and evidence-based finance function. Overseeing digital transformations will be an immediate challenge for finance leaders. This will include gathering and analyzing large quantities of data and replacing outdated and inefficient tools with technology-enabled cultures.