From Back Office To Business Leader4 min read
Morris Kupfer is VP of Finance at HighRadius, a global SaaS Fintech Company for the Office of the CFO.
Until recently, the CFO’s role entailed working in the background leading teams of finance professionals focused on reporting, compliance and risk management initiatives. It was a predictable path based almost entirely on historical data. But the modern finance leader is no longer confined to these old barriers.
Today, instead of sustaining our organizations based solely on outdated data, we use artificial intelligence and emerging technologies to bring new strategic value. Still, being in charge of financial operations, we drive further improvement across our organizations where finance teams are no longer waiting for crises to occur and instead prepare in advance for how to respond to them.
Staying Fresh For Higher Expectations
With such a significant shift in the finance function and finance leaders’ roles, it’s no surprise that we’re in the spotlight. Thanks to the digital tools we use, today’s finance department is more innovative and delivers higher output than a decade ago.
By harnessing the power of data and technology to drive efficiency and growth, we’ve not only become digital-first departments and strategic partners to the CEO, but we also measure current KPIs such as the impact of economic, social, governance (ESG) factors in real time for better investment decisions.
Digitization Fast-Tracks Excellence
In my early days, our tasks were repetitive and prone to human errors. The traditionally siloed finance roles within organizations often led to delays in operations due to a lack of communication and visibility. But armed with the latest technologies, I’ve witnessed newly minted “digital CFOs” turning their teams into the most significant function of their organizations.
At the same time, other finance leaders hesitant to adopt new-age technologies point to five main constraints keeping them from embarking on their digital journeys:
1. Concerns around potential security breaches and compliance.
2. Lack of digital skill sets across the finance function.
3. Insufficient understanding of the digitization opportunities in finance.
4. Minimal ROI generated due to confusion in understanding how to measure the impact of finance automation.
5. Time constraints with finance departments operating within strict deadlines.
Initially, I had similar concerns. But once I understood that we could showcase and measure ROI to draw truly valuable insights, I knew digitization was a strategic move toward business agility.
No To Unstructured Data, Yes To Accurate Forecasting
Finance functions hold massive arrays of unstructured data. This raw data is nearly impossible to properly collect, organize, format, analyze and process. Sure, finance teams that are accustomed to monotonous, pre-analysis work and data ingestion can take the time to do it, but how much “cents” does that make?
Since data-driven insight is now the most in-demand corporate currency, finance heads need a proactive strategy for converting data into business intelligence. Digitally transformed organizations that convert raw data into business insight achieve better, more impactful outcomes.
Real-Time Risk Management For Growth
Previously, risk analysts measured and segmented customers into risk categories, which were often manual, tedious and error-prone. But with the help of digital transformation, real-time credit risk monitoring has been made simple and effective to identify the short- and long-term risks while guiding sustainable development.
When finance disruptors improve the performance and efficiency of their organization’s economic engine, the CFO can focus on the business’s core values and analytics.
Streamlined Workflows, Better Returns
Finance leaders must be meticulous when it comes to operational excellence and cash management. But their teams are frequently swamped with requests from internal stakeholders who require information or access to critical reports and dashboards. Why force analysts to spend unnecessary time on such repetitive manual tasks?
A well-equipped finance team can optimize costs, automate repetitive manual tasks, reduce human errors and bring cross-functional collaboration leveraging technological advancements.
With the advent of automation, today’s finance teams reduce the time spent procuring, analyzing and sending vital data to the stakeholders. Outfitted with digital tools, I’ve seen how we’re able to strategize better, make better-informed decisions, control deductions, improve DSO and enhance other critical metrics.
Rise Of Smart Finance
In this digital era, we are the new business guardians. Our role has become more dynamic, strategic and, without a doubt, data-driven. CFOs must embrace these new responsibilities, look seriously at the cost and benefits of going digital and determine which tools will deliver the most advantages.
The finance department’s days as a cost center are over. Many suggest the CFO’s evolution to Combining Finance and Operations has become a reality thanks to the digital tools that help us identify new growth opportunities, streamline processes and make better investment decisions for tomorrow.
The fear that automation, digital platforms and other innovations are taking our jobs is misguided. Instead, automation saves us from mundane and routine activities, which are strenuous and tedious. By requiring fewer resources, finance teams can focus on adding business value, such as being proactive in planning and forecasting to eliminate problems, anticipating change and planning for the future.
The bottom line is, the finance function’s end-to-end, holistic view brings new efficiency and financial stability to the organization. I, for one, am honored to play my part.
Forbes Finance Council is an invitation-only organization for executives in successful accounting, financial planning and wealth management firms. Do I qualify?