Will it be business as usual in your finance department over the upcoming 12 months, or are you planning a significant overhaul of your personnel and processes?
For a growing number of Australian organisations, it’s the latter. Digital transformation is fast becoming an urgent imperative, as leaders look to their finance teams to add value, by providing quality business insights, strategic advice and exceptional customer service.
Delivering the goods will be challenging for accounting teams that continue to operate in analogue mode; using spreadsheets and siloed legacy systems to try to optimise cash flow, balance the books on time and extract the information business leaders need to make timely, data driven decisions.
Moving from manual to automatic mode
For that reason, we’re likely to see widespread adoption of automated finance solutions over the next 12 months.
The term ‘financial automation’ refers to the use of technology to automate many of the repetitive, routine tasks associated with the finance function – think reconciling accounts and producing statements and reports at the end of each month and quarter.
Financial automation can slash the number of human hours required to complete these tasks and reduce the error rate down to almost zero.
Saving time and money
The time saved can be spent on value adding activities, such as ensuring business leaders have accurate, up-to-date financial intelligence at their fingertips.
Automated accounts receivable technology, meanwhile, can take the hard work and hassle out of collecting and processing payments and chasing debtors; enabling businesses like yours to optimise their cash flow by speeding up the payment cycle.
In addition, the customer insights automating your accounts receivable function can unlock – think an up-to-the-minute view of the payment status of each and every customer on your books – can help to reduce the incidence of overdue accounts and bad debts. That’s because your AR team will be able to take pre-emptive action to limit or terminate the credit facilities of persistently tardy payers before, not after, they end up in terminal financial trouble.
Making a smooth transition,
Unfortunately, businesses aren’t guaranteed a smooth transition from analogue to digital technology. While automated accounting platforms may be user-friendly and can usually be rolled out in a matter of weeks and months, the technology isn’t ‘plug and play’. There can be pitfalls for new players when integrating an automated accounting platform with an extant ERP solution.
Furthermore, turning investments in digital technologies into genuine capability improvements calls for commitment from top management and ongoing cooperation between C suite leaders, most notably the CFO and CIO.
Fail to attain this across-the-board buy-in and the positive outcomes you’re seeking may fail to materialise too.
Charting a course
So, how best to proceed if your organisation has committed to going down the digital transformation path?
Whether your focus is solely on finance automation or encompasses a multitude of facets, including data analytics, cloud computing, workforce upskilling and risk management, detailing your objectives and establishing clear parameters and concrete metrics is critical. You can’t manage what you can’t measure is an oft quoted tenet of project management and it certainly holds true where transformation is concerned.
Deciding what success looks like – improved financial reporting accuracy, greater efficiency during the close process, reduced overheads in the finance unit or an enhanced capacity to supply business intelligence to decision makers across the enterprise – will help you determine whether your project is on track, as you work through the various implementation phases.
It can also pay to take an ‘education first’ approach – many organisations have found this is the best way to foster cooperation and collaboration among finance team members whose roles will be most affected by any transformation initiative. Without their support, you’ll face an uphill battle to embed new processes and practices, irrespective of their putative benefits.
Finally, teaming up with a specialist partner during some or all phases of the implementation can help ensure your project stays on budget and on track.
Gaining a competitive edge this financial year
Australian businesses will continue to contend with uncertain economic conditions over the next 12 months, as rising costs and slowing demand put the squeeze on profits. An efficient, proactive finance department is likely to prove a source of competitive advantage for many. If yours is yet to go down the digital transformation route, there’s never been a better time to start planning your journey.
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