The landscape of finance is undergoing a profound transformation. As organizations navigate the complexities of the digital age, the key to staying competitive and resilient lies in successful finance modernization.

In the past, finance departments were viewed as back-office, number-crunching departments looking into the past and reporting on historical results. Today, successfully modernized finance departments are seen as strategic partners that can influence business decisions by providing real-time, data-driven insights. This transformation has been driven by the need to streamline financial operations, unlock efficiencies, improve data governance and decision-making, and create more business impact. It requires a strong foundation: not only leading-edge technology, but also best-in-class practices, the right people, and timely and accurate data coming from core finance processes to feed data-driven dashboards and process automation tools.

To best position your finance department to unlock efficiency, agility, and sustainable growth, focus on these key elements of successful finance modernization.

This article is based on a CohnReznick roundtable. Contact our team to join the conversation.

1. Propelling change through the redefinition of traditional processes and operations. Automating ineffective, inefficient processes is a waste of time and money. Finance transformation should include a full re-assessment of the current function, aimed at revolutionizing the way the corporate finance function manages its strategy, processes, internal controls, and financial reporting.
2. Moving toward transformational Centers of Excellence (COEs) and outsourcing. With traditional outsourcing, the focus was on reducing costs (e.g., leveraging lower-cost offshore resources). Strategic outsourcing looks for not only cost advantages, but also access to external expertise to drive process and operations improvement. Shared services or Centers of Excellence (COEs) can help organizations enhance their customer and vendor experience, rapidly adopt best practices and new technologies, and implement entirely new business models (e.g., direct to consumer).
3. Adoption of cutting-edge technologies. Finance teams looking to modernize usually start by automating core finance functions, such as payroll or general ledgers, then exploring more complex solutions. Automated work flows and robotic process automation (RPA) are fast becoming the go-to tool in driving operational efficiency, reducing costs, and improving compliance by minimizing human errors. These investments are important to addressing not only repetitive tasks and bandwidth constraints, but also talent and recruiting challenges: Top performers will expect technology-enabled workforces.
4. Leveraging data analysis for decision-making. The integration of RPA with advanced technologies like artificial intelligence (AI) and machine learning can further elevate the analytical capabilities of the finance function, providing deeper insights and predictive analytics. This technological synergy enhances the CFO’s role in strategic decision-making, risk management, and driving business growth, ultimately positioning the finance department as a more proactive and strategic unit within the organization. To unlock the power of data, companies need to have a clear data governance strategy with the optimal mix of standardized manual and automated processes.

Next steps to start or accelerate your transformation journey

• Outline and communicate strategic goals and desired outcomes – what are you transforming, and why?
• Align and engage key stakeholders.
• Identify the sponsor, governing body, and champions for the transformation.
• Consider engaging business advisors to shape and guide the journey.
• Determine the gap between current and desired state.
• Create a detailed roadmap and implementation plan.
• Commence the transformation initiative.
• Manage progress and monitor accomplishments.
• Celebrate key milestones.

Contact our team to learn more and start planning or enhancing your finance transformation.