The role of Chief Financial Officers (CFOs) has moved beyond traditional financial and accounting supervision. They now operate in the centre of the organisation delivering relevant insights on business performances that underpin and guide the entire company functioning. CFOs are increasingly becoming key advisers to business, making near real-time, data-enabled decisions.
As data becomes more distributed, dynamic and diverse, data no longer resides in a single enterprise repository. Instead, it is likely to be housed and processed in multiple parallel operating locations, such as ERP systems, billing systems or commerce platforms.
It is imperative to develop advanced forecasting capabilities and new finance management technique which provides the opportunity to take analytics capability and data beyond the finance function to support the enterprise holistically.
Along with developing new talent and skillsets, and through investment in technology, using analytics in finance enables CFOs and finance teams to generate a competitive advantage and growth for the entire enterprise.
Analytic Process Automation (APA) is the key. APA enables easy data sharing, automates tedious processes and unlocks predictive insights that drive timely attainment of goals. It eliminates the need to use multiple discreet tools to manage data, processes and people, making it easier and faster for governments to take care of the citizens.
APA is an effective tool for the public sector industry to track and fight the pandemic outbreak, improve data accountability, increase transparency in procurement and facilitates effective disaster recovery and relief.
By intelligently automating the hundreds of repetitive and complex analytic processes, the finance team can save hours of manual work and be able to spend more time on delivering vital outcomes. On top of that, the accuracy and flow of data would significantly be improved in its operation as APA streamlines entire data-driven processes in a preferred consumption format.
The full visibility of data across key financial management systems enables every function in the finance team to take advantage of data and easily collaborate across departments, where the analytic effort can be shared and reused.
Knowing this, the core question remains: how can CFOs and the finance team leverage Analytic Process Automation without dependencies on the IT department?
This was the focal point of the OpenGovLive! Virtual Breakfast Insight held on 09 June 2021. The event aimed to impart knowledge on the democratisation of data and analytics in the office of finance and explore best practices to achieve a culture of analytics, upskilling of employees and service efficiency.
The session served as a great peer-to-peer learning platform to gain insights and practical to implement Analytic Process Automation to enable more efficient data processing while reducing the complexity and cost.
Digital Transformation Within the Office of Finance
Mohit acknowledged that life in financial organisations is filled with challenges. Financial officers juggle many roles, responsibilities and requirements. Not only do they need to understand the numbers, but they are supposed to make sense out of those numbers.
At the same time, technology is moving so fast and comes at a significant cost. Previously considered a somewhat unnecessary expense, tech has now become the backbone of every business. In these current times, organisations welcome technology as an investment.
Along with the rise in technologies, more data than ever before is being collected. But in and of itself, data can do nothing. Mohit emphasised users must fully understand what data can do for them. Data must be unlocked to achieve better business outcomes.
Most people do not know where to start – that is where problems come from. Users need to investigate the depth and scale of data and not merely play on its surface. Data must be democratised through three mega pillars: comfort, tools and culture. Financial offices need to understand that data must be democratised and made accessible so more people can use it.
Organisations from all over the world came up with a slew of ad-hoc solutions and band-aid technologies to further their digital transformation journeys during the pandemic. Digital initiatives and tech platforms were launched left and right but COVID-19 taught us that there is room for change.
Mohit emphasised that this is the time to recognise what organisations can automate and this is the perfect time for comprehensive digital transformation.
In closing, Mohit urged the delegates to find the right partners for their data and digital journey. If they want to stay ahead of the curve, it is vital to work with experts who can guide them along the right path.
The Convergence of Data, Process and People
After the opening address, the session heard from Philip Madgwick, Regional Director (ASEAN), Alteryx, who talked about the state of the analytics market and the journey to analytic process automation.
He believes that the process of utilising data is built on three key pillars. First is the idea of data democratisation which means making data accessible for anyone in the organisation to drive digital transformation initiatives. The second is process automation that ensures that the organisation can automate repetitive processes, increasing overall efficiency and decision-making. Thirdly is upskilling that promotes the improvement and capabilities of people handling the data within the organisation.
For Philip, CFOs have a unique vantage point that ensures investments are aligned to outcomes and growth. The process starts with purchasing, spending on analysis and vendor management. Next are business units, margin erosion analysis, pricing analytics, service level and customer profitability alignment.
Sales and marketing also come into play. Price-point, revenue leakage, revenue driver, demand/price elasticity, customer retention and churn analyses are vital in the process. Another one is the supply chain. Sales and finance-linked forecasting, new product introduction, profitability and dollarisation effect. Lastly, is IT or the organisation’s technological investment planning and prioritisation.
With these steps, financial offices can ensure an efficient operational execution from operational decision-making, strategic decision-making and driving profit lost in operational execution.
There are, of course, organisational challenges that stand in the way of achieving these desired outcomes. A disconnected approach between data, process and people prevents ideal outcomes. Challenges also include limitation of data, slow data curation, analytics and data science, processes that are manual and unoptimised, disjointed and unengaged people with no sign of upskilling.
To rise above these challenges, Philip emphasised that the three pillars – data, process and people – must converge into one priority. Data and analytics must be open to democratisation to allow easier access to data and automated machine learning for analysts and data scientists. Automating processes is key to minimise manual intervention, achieving high efficiency and minimal error.
Last but not least, is upskilling people. Governments must have a robust analytics community, enriched step by step with a classroom curriculum and by utilising intuitive and engaged platforms to help build confidence among the workforces.
To end his presentation, Philip shared how Alteryx automates an Office of the CFO. It starts with tax automation, risk, audit and compliance monitoring and optimising accounting and operations. By automating these processes, the office of finance saved on resources like manpower hours and allowed them to focus on tasks that require more human intervention.
Philip is positive that the automation procedure helps organisations in advancing their digital transformation journey. He conceded that the office of finance must continuously embrace the innovation of the three key pillars of digital transformation moving forward.
Analytic Process Automation for Finance Functions
The delegates moved to a presentation from Rinrat Pasavekin, Partner, PwC Thailand. She discussed the process of delivering actionable insights with Analytic Process Automation in the office of finance.
Rinrat is firm in her conviction that the office of finance needs to transform its processes. She emphasised that finance is perversely impacted by several global trends creating an urgent need for finance to transform to better support the business.
Typical triggers for transformation are:
- Workforce Skills Gap (Source and retain new skills, Managing an ageing workforce)
- Emerging Technologies (Siloed information systems, Increasing data volumes)
- Investor / Cost pressures (Decrease costs to serve, Business enablement)
- Reporting and Analytics (Integrated information, Improved decision making)
Typically, the office of finance responds to these triggers by exploding data volumes, changing regulations, radical automation, industry convergence, settling with unstructured data and building B2B to B2C business models.
Rinrat believes that the office of finance’s digital transformation is enabled by a seven-point Modern Finance Agenda. She underlined that this agenda requires a strategic shift in the operating model to be digitally enabled:
- Finance Workforce of Future
- Finance Organisation and Structures
- Process Excellence and Automation
- Cloud ERP and Digital Platforms
- Automated and Predictive Controls
- Advanced Analytics, Insights and Action and,
- Insightful Finance Business Partnering
In her experience, clients have a proclivity driven by their culture, values and objectives which drives their focus on what key aspect to start their digital transformation on. Ideally, finance offices must start leading with people, leading with the process and ultimately leading with performance.
Leading with people involves a digital finance workforce. Upskilling finance workforces to be digitally savvy and supplemented with new human and machine-based roles. It also deals with modern finance workplaces. Re-thinking collaboration spaces and structures for finance employees and external parties (e.g., suppliers).
Leading with process means utilising intelligent automation. Finance organisations must learn to apply automation to simplify, accelerate, or re-design processes. The capability to predict enterprise risks is also key. Applying automation to rationalise and re-design control structures to shift from detective to predictive controls must be focused on. Lastly, is utilising a pre-configured Cloud ERP, shifting and upgrading the existing ERP to deliver new finance capabilities in public/private clouds.
Leading with performance on the other hand is by using a connected, self-service data, enabling the enterprise’s digital core by connecting ERP/EPM tools, data lakes and self-service, voice-activated information supported by Artificial Intelligence (AI). Assisted insights and performance must also be looked upon. Applying analytics and machine-based models to deliver business function insights and financial planning and analysis improvements will help a finance office in any organisation in a big way.
She acknowledged that there are certain challenges in trying to implement digital transformation within the office of finance. One is identifying and consolidating data, which takes a lot of time and resources. Another issue is that data owners may be hesitant and/or unable to provide quality data.
Rinrat advised the delegates to always evaluate the integrity and organisation of current data for them to recommend the accurate timeline and they must look to reach out to required data resources as quickly as possible. With leadership support, they can further the office of finance’s digital and data journey.
Interactive Discussion
After the informative presentations, delegates participated in interactive discussions facilitated by polling questions. This activity is designed to provide live-audience interaction, promote engagement, hear real-life experiences and impart professional learning and development for participants.
The opening poll asked how delegates would rate their organisation’s use of data and data analytic tools for decision-making. Half of the delegates (50%) said that it is fair and they use data in their decision-making process. However, they acknowledge that the analysis is primarily a manual process as they do not have enough data analysts/scientists. About 28% said it is good and they have some tools in place but are still learning how to optimise them fully. Just over a fifth (22%) indicated that it needs improvement and they need better tools to analyse and are currently relying mainly on Excel.
The delegates were asked what they consider the greatest barrier to integrating more data and analytics into their day-to-day decision-making? A third (32%) indicated that the lack of trained people to do actual analysis is the greatest barrier. Around 29% conceded that they have limited access to data because they are kept in silos or disparate locations while 21% said that the available data are not accurate or updated.
The next poll was about the delegates’ top drivers of data and analytics usage in their respective organisations. About 43% acceded that removing inefficiency in processes and speeding up decision-making is their desired outcome, 39% said that achieving better organisational decisions and outcomes are the main drivers, while 11% said that ensuring compliance with laws, rules and policies is their main priority.
On being asked what their biggest barrier to progress in their organisations’ data journeys was, more than half of the delegates (54%) said that the disconnect between IT & business / organisational requirements is the biggest hindrance. Just over a fifth (21%) said that poor quality and availability of data causes them to further their data journeys, while 11% said that a non-data-literate workforce is the biggest barrier.
The delegates voted on four strategies that they are thinking of implementing or interested in. A significant 43% are interested in reviewing existing processes and identifying which ones can be automated and can be made more efficient. A shade over a third (35%) are contemplating upskilling thei workforce to scale use of data analytics on their own, while 11% are interested in consolidating current analytic tools to simplify adoption across the entire organisation.
In terms of their strength in the use of data analytics, about 31% of the delegates said that understanding, support and commitment from top management remains their biggest strengths. A quarter (26%) voted for the deployment of powerful tools and efficient process to facilitate good data analytics projects, while another 26% of the delegates said that deriving meaningful insights through data analytics is their biggest asset.
Conclusion
The session concluded with closing remarks from Philip and Rinrat.
Philip reminded the delegates to always focus on the three key aspects- data, people and processes – in their digital transformation journeys. He further advised the delegates who were just starting their digital transformation journeys to remember that they can always reach out for partnerships; not just to Alteryx, but to other service providers. Organisations who were well on the path to a true digital transformation would also make great advisers.
Rinrat thanked the delegates for attending and the wonderful time of discussion. She stressed that true digital transformation involves partnerships that ensure an organisation’s desired outcomes. She invited delegates to contact PWC for any concerns, especially those regarding finance offices’ data and digital journeys.
