A CFO’s Quest to Digitalize Finance
In these challenging economic times, finance leaders must cut costs and modernize practices. Too often, finance is still seen as a blocker rather than an enabler of the business. Adopting advanced digital technology can transform finance into a function seen as an inventive, value-adding part of the business. Finance leaders are looking to move the dial in 2023; let’s take a look at what they have planned.
Top 10 CFO priorities in 2023
CFOs in 2023 are focused on rethinking the finance function, according to Gartner’s recent survey that ranked the top 10 priorities for CFOs for this year. Four of the five priorities all relate to redefining and remodeling how the finance function supports the business for the future.
Incorporating new technology and data into finance processes can elevate the function into a real-time provider of strategic insights and data for a business. CFOs see incorporating digital technology as critical to improving profitability in volatile times.
How to digitalize a finance department
The quest for greater cost-efficiency is driving more automation in finance. Digitalization is necessary for any finance chief, given its potential to reduce costs, shorten processing times and boost productivity. Still, CFOs must take several key factors into account to digitalize the function successfully, reports Raconteur.
To create a fully digitalized finance function, you first need a solid foundation to build its essential features. CFOs are prioritizing back-office automation to boost efficiency in revenue management, general accounting, and internal IT services. One of the critical aims of technology adoption – freeing people to do more exciting and valuable work – ought to make jobs in finance more appealing to talented professionals. Adopting advanced digital technology can help transform finance into a function that the rest of the organization sees as more of an inventive, value-adding business partner.
Data-driven decision-making at the center of 2023 CFO actions
CFOs who spent 2022 modernizing their businesses expect to reap further data-driven benefits in 2023. PYMNTS found that providing value through cutting-edge analytics is an important priority for finance leaders in the coming new year — regardless of industry or geography.
Data provides certainty, and certainty is key for CFOs looking to stay profitable by making more intelligent decisions. Leveraging organizational data is vital to unlocking greater value from existing business models by increasing visibility and allowing greater control over spending and further accountability over standard processes.
Artificial intelligence (AI) and machine learning tools can help finance leaders re-evaluate how they use their resources by uncovering key opportunity areas. The most competitive companies now focus on digitally-driven modernization of their operations, from data management to expense monitoring.
CFOs still prioritizing digital transformation
Facing economic headwinds as 2023 begins, CFOs are focusing on costs, looking to reduce discretionary spending where possible. They continue to view digital transformation as strategically important for their businesses, but there are definitely some cost and spending pressures associated with digital transformation.
CFO Dive notes a potential recession could change finance leaders’ strategies when it comes to digital investments and technology spending. Budgets will not necessarily shrink in 2023, but there might be a redistribution of expenditures. Companies may increase investment in automation technology while at the same time taking steps to reduce the number of platforms they leverage.
AI-based process discovery keeps the lights on
A large US-based diversified electric power provider wanted to explore the efficiency of the procure-to-pay (P2P) process to help reduce risks and costs. In today’s deregulated marketplace, minimizing the total cost of procured goods is a critical goal. Plus, any delays in parts procurement can impact grid performance. The company turned to IBM AI-based process discovery for answers.
Among the model’s key outputs was the finding that just 20% of materials-related purchasing activities, such as buying spare parts, followed the optimal procurement path. For the 80% of activities that did not conform to the happy path, the average order lead time was more than 30% longer, due largely to the extra time spent on invoice matching and order reworking.
Start now, think big, go fast
As finance leaders strive to reduce costs and modernize practices in a challenging economic environment, a robust intelligent automation platform supports a shift from tactical financial management to strategic partnering with the business.
If you want to learn more about how IA helps you win in the market and delivers operational excellence to the enterprise, let’s talk .