The nature of Finance is continually changing. New technology is giving organizations greater visibility and control over their data. Thanks to automation and dashboards, business leaders can call up information with a click, freeing Finance from its archaic role as information gatekeeper.
Today, financial teams can move beyond checks and balances. With the right tools, Finance can play a pivotal role in helping business leaders make decisions faster — decisions informed by richer historical data and predictive insights.
But getting there is not just a matter of having the right technology. Finance transformation is about preparing your financial team to take on shifting roles as data analysts and business coaches. The more empowered they are to collaborate with other functions, the better they can create a network of opportunity and results for the organization.
Here’s the opportunity ahead for Finance and Accounting teams:
In this role, Finance will proactively seek to understand other functions (e.g., Sales, HR, Operations and the Executive Suite) and the key performance indicators (KPIs) that make those functions effective.
CFOs and other Finance leaders will become advocates for business operations outside of Finance. Instead of pushing data to these disparate functions, they’ll solicit key bespoke data that aligns with the traditional financial data of the past (e.g., income statements, cash flows, budget vs. actuals, etc.). Finance will then take things a step further helping interpret what the information is saying. And, where possible, Finance will lead the charge toward newer processes and tools to gain even further insight into operations.
In this role, Finance will proactively model other function’s operations. When special ventures are on the table, Finance will help develop that vision with measurable leading indicators. Those numbers will then be tweaked in endless what-if scenarios. As the ventures progress, the strategies around them will progress and the models will be continuously tweaked real-time, supporting any necessary pivots from the original vision. Further, these ventures and their supporting models will be scrutinized for how well they support the organization’s larger strategic vision.
In this role, Finance will buck the trend of what has historically been a “dump on finance” request cycle. By proactively sharing insights with the other functions (instead of passively waiting for requests), Finance positions itself to:
- Share the responsibility of analysis where it’s best shared and
- Influence the analysis of the enterprise’s overall financial strategy (i.e., financial strength).
Leadership through collaboration
So how does Finance position themselves for this evolving role? By leadership through collaboration.
Traditionally, Finance has made a modest attempt at collaboration by integrating with human resources, through payroll systems and HRIS. But going forward, Finance needs greater integrations with other functional areas to develop business agility. This is facilitated through the activities, processes or applications that position Finance to collaborate proactively with other business functions. Consider some of these integrations:
- Accounts payable with marketing to better understand the cost of acquisition
- Accounts receivable with sales to better understand the true profitability of an acquisition
- Inventory with manufacturing expenditures to better understand pipeline overhead
- Billing with operations and project management to better understand employee contributions
Finance needs to move closer to the front-line transactions of other business functions, pushing the envelope on streamlining communication and collaboration. When this happens, the time it takes to get answers plummets. Finance learns more quickly what is and is not working in the enterprise, and needed adjustments are brought to the surface sooner.
Finance is uniquely positioned to play a transformational role in the organization. It’s the core supporting organization inextricably linked to every other through its paramount responsibility of harvesting and interpreting the transactions of the enterprise. By automating manual processes, Finance gains the time and opportunity to lead more than support and become strategic partners, not just to c-suite but, throughout the organization.
Contact us to learn how, or continue reading on:
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