If you’ve visited this site, the chances are that you’ve heard of digital finance. But do you actually know what it means in a practical sense?
Essentially digital finance utilises the latest technology to help streamline processes, remove errors, compile rich, real-time data and deliver actionable insights for every area of the business. It also frees you and your team up to do more analysis, create richer, more accurate forecasts, and offer more support to stakeholders throughout the business.
There is a lot to it, but it doesn’t necessarily mean you need to incur huge costs in order to make it work. You know where your own problems are within our own business – you don’t need a consultant to come in and tell you that. Where you do need support, however, is in matching the right technology to solve those issues.
How to identify your issues
A lot of the common challenges are actually fairly mundane but, from an efficiency and risk perspective, can help you build a compelling business case for adopting digital finance. These challenges include:
- a lack of controls
- overly manual processes – e.g. a large number of manual journals
- budgeting and forecasting inaccuracy/inefficiency
- internal and external reporting takes up too much time
- the data is too high level and comes too late to be of use
All of these challenges create the risk of errors in reporting (especially in external reports). Business decisions end up being made based on inaccurate information. In turn, audits cost more, due to the perceived risk. The finance function is also generally inefficient.
This creates a pretty compelling business case for embracing digital finance. There are several technologies that you can use to solve these issues, such as cloud-based planning, controls automation, robotic processing automation, data visualisation and business intelligence, advanced predictive analytics, and machine learning/AI.
If you think you need an outsider’s perspective on how your finance function is performing in order to build a case for the right solution for the business, you can arrange for a workshop to help you review your processes and discover where your business cases may lie.
Sit down with your team and discuss some of your issues – find out how it’s affecting them and incorporate that into your business case. Once you have compiled your list of issues and their impacts, that’s the right time to engage with a consulting partner who can guide you through the minefield of competing technologies.
Fidenda worked with a retailer that had an overstretched finance team. The company were facing new regulatory reporting requirements that were threatening to overwhelm them completely. On top of that, the team was under pressure to reduce costs. They were stuck between a rock and a hard place.
Creating a roadmap
The finance team turned to Fidenda to help them find a way out of its predicament. Fidenda reviewed all of the team’s challenges, putting them into priority order and assessing the state of their current IT capabilities.
Fidenda created a technology roadmap, using a combination of the existing system and new cloud platform, to address the issues. This improved the controls framework, and increased the accuracy of forecasts and reports. By introducing as much automation into the processes as possible, the team was able to meet additional responsibilities without increasing headcount.
This blog is co-authored by Christopher Argent of Generation CFO and Tristan Colgate of Fidenda. Join Fidenda at the Anaplan CPX London at Central Hall Westminster, 30 September-1 October. Sign up here.