October 18, 2016 | Written by: Mark Dudgeon
Categorized: Thought Leadership
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In the recent IBM study, CFOs identified industry convergence, competition and commotion as having the biggest impact on their business. To face these challenges, CFOs must take on new responsibilities and use data to spot opportunities and challenges. Top CFOs are rising to the challenge and finding success in the age of disruption CFOs identified the following themes as key to success:
Drive integration of information across the enterprise.
Organizations must have governance in place that assures common business processes and data definitions in one place. This is the one place in your system environment that satisfies all your financial information needs and is the single source for all of your interfaces. Many organizations are struggling with this and, as a consequence, are not able to provide the required business insights.
With the introduction of SAP S/4HANA Finance, SAP created “one ledger” called the universal journal where all details supporting tax, legal, and management accounting can be found. As a consequence, all the data is available in one place, with flexible analysis tools and embedded analytics simplifying interfaces and allowing finance to change from simply reporting results to analyzing business performance.
Develop talent in the finance organization.
With the changes in technology, the finance organization needs to develop talent with a new set of skills. However, acquiring the right technological know-how is only one of the issues CFOs know they’ll have to contend with – and many are preoccupied with more immediate challenges, such as whether their own finance teams are ready to weather the storm. Three-quarters of CFO respondents said it’s vital to integrate information and resources across their enterprises. Yet less than half told us their people are up to the job. There are almost equally large gaps between the importance CFOs attribute to various other priorities and the proficiency with which they said their employees perform these tasks
Organizations must transform their workforce by:
- Transforming competencies to more value-add activities to support evolving role of finance
- Focusing qualified professionals on driving business value and innovation instead of wasting efforts on less value-add activities
- Developing junior employees in decision support and not just relying on management to perform data analysis
Shift of focus from cost to identifying and tracking new revenue growth opportunities.
As a result of simplified finance data structures, CFOs can have better insight during the period. Organizations have easy access to real-time profitability on a very granular level. As a result, finance can perform end-to-end analyses and define new responsibilities in many areas. New data insight and cognitive capabilities is important to help identify new trends in revenue, customer intimacy, determining the next best action for existing customers, identifying new customers and new markets.
CFOs know they need to prepare for a future in which disruption is pervasive: a future in which technological advances are blurring the distinctions between different industries and new competitors are emerging “from left field.” So how can they help guide their organizations through the tumult as safely and profitably as possible? In our joint POV, IBM and SAP show how CFOs can embrace technology in the era of digital transformation and achieve success for their organization. Read the ebook “CFO Perspective: Finance in the era of digital transformation”