Today’s world is changing rapidly, as businesses must constantly find new ways to adapt. Digital transformation has the potential to play a vital role in overhauling entire business operations. One way digital transformation can make a significant impact on the business world is within a company’s financial department. CFOs play a key role in helping to drive digital transformation further across finances and beyond.
Digital Transformation & the CFO
Choosing to oversee the digital transformation of financial tools, tasks, and practices impacts all organizations. CFOs need to be the leaders for digital transformation. They have the ability to help businesses create innovations. For instance, these innovations can improve efficiency and boost operations.
Here is an overview of the top trends shaping digital transformation for finances, now and in the future.
Re-evaluating Current Business Model
Performing digital transformation for the sake of making changes doesn’t benefit anyone. However, digital transformation offers many advantages for your company and your customers. This is possible by making these changes with a clear goal of improving your business model.
Sometimes, this may involve creating an entirely new business model. For instance, many companies implement digital innovations to focus more on customers. This method often upgrades business processes in various ways to further enhance customer service.
You can also use digital transformation to find ways to improve internal operations. This could be whether you’re streamlining finances or improving the use of internal resources to maximize efficiency. However, the benefits of making these changes need to impact your customer. This could result in cost savings to help you stand out from the competition or even improve your company’s service quality.
Legacy technology often doesn’t lend itself to innovative business models. CFOs need to examine further how digital transformation can create new opportunities to change business operations.
Expansion of Automation and Machine Learning
Automation is often used in finance departments, but the reliance on automation continues to expand. Many of the top financial software options are using automation in various ways. For example, they use automation to minimize errors, accelerate business processes, and save time, allowing employees to focus on more essential duties.
Tools can now access data across an entire enterprise in real-time. Meanwhile, they can also organize this information into simple reports for CFOs. Automation makes it possible to create dynamic modeling and consolidate financial documents as well as help with data collection and preparation for taxes. The use of automation will only continue to expand and provide greater assistance for the office of the CFO.
Machine learning is another important aspect of automation tools, as it can easily handle complex situations and make the best decision for a variety of scenarios. The use of machine learning also helps to expand further the analytics capabilities of CFOs, which results in greater insights into all of the financial data collected throughout the organization. These valuable insights can play an important role in making strategic adjustments to improve efficiency and enhance capabilities for all types of businesses.
Deliver a Better Customer Experience
More business models are shifting towards a customer-first approach. This may be because many finance departments are under increasing pressure to oversee digital transformation and create a much better experience for customers. For example, automated data collection makes it possible to deliver information more quickly and provide better insights for customers in real-time. The implementation of new technology can further enhance the user interface for different customers. Additionally, it can enhance businesses’ ability to gather important information.
CFOs need to understand how digital transformation indirectly impacts non-financial areas of the customer experience. For example, marketing and sales may not be directly impacted by the digital transformation that the finance department conducts. However, the improved flow of information and machine learning insights, provided by analytics, can offer additional help. This can influence how the marketing and sales team further enhance customer engagement. Furthermore, it can lead to higher conversion rates and improved retention rates.
Expanded Collaboration Between Teams
Most departments inside an organization can’t access specific performance information related to other departments. These departments often operate within themselves, whether it’s human resources, IT, marketing, and other areas.
However, finance is different because each department’s performance is shown through financial data. These metrics can provide a detailed view of the success of each department. The office of the CFO can play a key role in making strategic adjustments with this information. This includes adjustments such as using cross-functional teams to work on specific tasks by gaining detailed information from financial data.
Increase of Self-Service Analytics
Self-service analytics is becoming even more popular with CFOs that are finding ways to gain more valuable insights from financial data. Gaining faster insights is especially important in creating changes and improving agility throughout an organization.
Self-service analytics enables CFOs to easily handle analysis related to finances without the need for reaching out to IT or having to wait on receiving assistance for these tasks.
Oftentimes, the request for IT assistance takes up to one business day to receive a response. Afterward, it can take a few days or even two weeks to collect the data, create a report, verify the information, and provide analysis. However, self-service analytics makes it possible to collect data, build reports, and perform instant validation to enable CFOs to take advantage of the speed and performance to make better decisions.
Self-service platforms also provide a simple user interface for finance professionals. They can leverage this information to gain more significant insights and more visualizations that can be created at any time.
Less Dependence on IT
Using self-service analytics is an excellent way for finance teams to lessen their need for IT. But, CFOs can also implement new financial software to utilize automation services fully. Automation makes it possible to deliver data in real-time, eliminate manual tasks, and give finance teams the ability to operate with more independence. This helps to improve workflow and enhances productivity for everyone.
These CFO dashboards and reports make it possible to provide top-quality tech service that wasn’t previously possible without assistance from the IT department. Now, IT can spend more time on high-value tasks within the business while letting finance teams use these new tools to meet their needs.
Digital transformation allows CFOs to reimagine current strategies and implement new approaches to replace inefficient and outdated business procedures. Using this unique approach helps the entire organization identify and take care of any operational issues to improve efficiency further. CFOs can utilize digital transformation to accelerate development and gain access to the latest information to help improve decision-making throughout all aspects of the company.