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Even though CFOs are no doubt convinced of the importance of digital transformation, plenty of opportunities remain to take digitalisation that one step further. And that’s mainly to do with how finance departments are organised nowadays, and what their approach to digitalisation and automation is. But before we take a closer look at those aspects, let’s ask ourselves: what are the main triggers these days for automating finance departments?
the driving forces behind automation in finance departments.
Digitalisation and automation are making headway everywhere, including in finance departments. The finance department of the future will (need to) jump on board with these developments, so it can evolve towards becoming the place to go for strategic business advice.
In other words, when it comes to running a business, CFOs – and by extension, the entire finance team – will play an ever more important role. They will be expected to produce high-quality insights almost instantly. That way, they can help shape the long-term strategy of the business and monitor the profitability of the organisation.
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To ensure an effective transition towards this more strategic role, finance departments need to take a closer look at the ways in which they work today. After all, there’s no two ways about it: a huge amount of the work performed by finance teams still consists of manual tasks.
A high volume of manual tasks means there’s much more margin for error, and that’s before we mention lost time – people will always work slower than bots. On top of that, the time-consuming nature of these tasks means less time remains to invest in the strategic advice we’ve all been waiting for.
Generally speaking, it has become clear by now that automating certain tasks does not mean people will become superfluous and jobs will be lost. Automation merely leads to changes in the tasks people perform, and adding value to the company strategy is by no means the sole guiding principle in this. Job satisfaction is also set to improve, as boring, repetitive tasks will be eliminated.
With these trends in mind, more and more CFOs find themselves tempted to jump on the digitalisation and automation bandwagon and transform the way in which they work.
what is holding back automation in finance departments?
1. a fragmented approach.
Your finance department has undoubtedly taken at least a few initial steps towards automation by now. And you’re bound to be feeling pleased about that; you’ve set the ball rolling, and things can only improve from now on! At least, that’s what you thought when you made those decisions. As time has moved on, you’re not really seeing the results you were expecting.
So why is that? There’s a good chance that what you actually created is a fragmented landscape, in which tools and technologies merely exist side-by-side, and in which the bigger picture has been overlooked.
This type of landscape can come about in a multitude of ways. You might simply not have the time to really get to grips with digitalisation, or you might be lacking the technological knowledge you need. In these situations, it’s often tempting to settle for a solution you were introduced to at an event, or during a demo for a tool you found yourself on the internet. These types of solutions appear to be reliable and they solve a specific problem, so you think: why not?
Alternatively, the range of different (underutilised) technological platforms could be the result of historical factors. They might have come about as a result of mergers, for example, or due to changes within the team, resulting in new colleagues suggesting new ways of working.
These types of fragmented landscapes are likely to leave you with three disadvantages:
- By taking one individual step after the other, you create a culture of constant change. And as you’re undoubtedly aware, (never-ending) change can often lead to resistance and frustration.
- By settling for a specific technology too quickly and without enough thought, you’re often creating a situation in which barely any colleagues on your team have sufficient technological skills to use the new systems you’ve chosen.
- A fragmented landscape often lacks sufficient integration with other software. As a result, many of the advantages of automation are not adequately realised.
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2. keep financial talent loyal to your organisation.
An entirely new generation of employees is entering the labour market – including finance – with different professional dreams and expectations. Gen Z is the first generation who simply cannot imagine how we ever managed to function without the help of technology. They’re constantly using a whole range of tools to make their lives easier, and they expect no different in their jobs.
Innovation and flexibility are two aspects that are hugely important to your employees nowadays. And no, the ageing software still being used in lots of finance departments does not exactly contribute to those aspects. In other words, keeping this new generation happy in their roles is yet another reason to embrace the latest technological opportunities.
Even though your accountants, controllers, and analysts still need to have all the right competencies for their roles these days, the fact that your business also needs to attract and keep financial talent who use their creativity, feel for technology, and curiosity to strive towards better results cannot be overlooked. Their technological skills are in high demand and can genuinely help your business take major strides forward when it comes to digitalisation and automation.
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3. technological innovation is happening (too) quickly.
It can often be a challenge to stay up to date with technological developments: you’ve got other priorities or you simply don’t have much of a feel for it. The range of solutions available seems almost endless and nothing ever stands still. If you’re not fully on board, you run the risk of not using certain tools in the most optimal way. For example, you might use one option provided by a solution on an almost daily basis, while remaining completely unaware of all the other useful options available. It’s almost like seeing colleagues outside of your finance department only scraping the surface of what Excel can do… ;-)
The speed at which new technologies are developing also presents another possible challenge. Lots of change over a short period is not something all your colleagues can handle with equal ease. Some are completely set in their ways when it comes to performing certain tasks and don’t always see the positive impact that technology can have on their daily workload. And even if they do adopt a positive attitude, it’s not always easy to develop new skills at a quick enough pace.
Fear (of failure), reluctance to change, a lack of trust – these are just some of the emotional aspects that may be contributing to your finance department falling behind the pack when it comes to digitalisation and automation.
turn the tide.
- Have the courage to make a start, but be aware that there’s no need to change everything all at once. Where do you see your own department going? And what are the objectives of the company at large? Which tools are you already using today? Taking a step-by-step approach will help you maintain a clear overview and will keep new developments manageable for colleagues who might struggle with change.
- Partner up with your HR department. Doing so will help you identify where the gaps lie in your current team and will give colleagues the chance to develop professionally via upskilling programmes. On the other hand, HR can help you offer sufficient career perspectives to keep digital natives loyal to your business.
- Always look for ways to increase engagement. Upskilling is likely to remove some of the resistance to change, but make sure to proactively discuss change with your team as well, and alleviate their fears.
- Feel like you could do with a helping hand? Get in touch with a partner like AUSY that can guide you every step of the way, from analysis and strategy to implementation and follow-up.