This article was published in The Guardian Newspaper on 21 April 2021. Below is an excerpt from the article.
All over the world, there has been a rapid transformation in how businesses operate and thrive. The new order of operation is largely a result of the speedy adoption of new technologies but exacerbated by the pandemic that has now redefined how we live and interact. Business functions within organizations are now forced to reinvent themselves as the effectiveness of their operating models are being challenged.
The skills set and operational model within Finance units are continuously being challenged by exploding volumes of data (mostly unstructured data from social media, online platforms, text etc.) that create accounting and data analytics challenges. Also, periodic reporting is fast losing its grip on driving operational and business decisions due to the increasing amount of real-time data across business units for planning, forecasting etc. Business functions across organizations can now access their analytical tools with less reliance on the finance unit.
The technological revolution is forcing the finance function to change everything –including the way it plans, budgets, forecasts, partners, pays, accounts, controls, reports, and manages risk. Consequently, there is immense pressure on finance to own its processes and transform them to sustain its relevance with an organization. The traditional finance function is unable to sustain its relevance in meeting the expectations of the stakeholders unless it transforms.
To thrive, the finance operating model consisting of the workforce, operational processes, data and information management systems and organizational structure needs to quickly evolve to meet current demands. Below I will discuss some of the transformational trends from a finance function perspective.
In this age of digitization, increasing volumes of operational and transactional work (e.g. transactional processing of accounts payables, accounts receivables, etc) are being replaced with automated processes. Finance skills are now required for more strategic and insight-driven tasks that require complex interpretations