– Digital technology at the service of financial departments
Knowing and analyzing how your business has performed over the last quarter is necessary, but what is fundamental is applying this information to your future strategy to set a course for growth.
Xavier Chabanne – Oracle Switzerland
In the past and depending on the size of the company, completing the accounts involved drawing information from multiple Excel sheets. After analyzing the results, they were published. This all took place over several weeks. Today, the cloud connects business applications and automation has gradually taken over.
CFOs prioritize technology investments
The Oracle-IDC survey conducted in 19 countries around the world reveals that nearly 85% of financial services leaders believe that modernizing financial operations is the driver of competitiveness in a global economy.
Chief Financial Officers (CFOs) of banks and insurance companies today face challenges such as inflation, supply chain constraints, and regulatory requirements, while dealing with increased competition. These challenges are driving investment in advanced fintech.
According to the latest report fromIDC, 84.5% of respondents believe that modernizing financial operations will be essential to be competitive in local, regional and global markets. Additionally, 77.8% of senior executives believe the finance function within their organization needs to change, and more than 75% said they are investing in modernizing finance.
The study showed that the vast majority of financial institutions require near real-time access to reconciled data for all aspects of financial operations. This is why administrative and financial departments (DAF) must invest now in digital technology that exploits the latest innovations and enables efficient use of their organization’s data.
The global financial applications market reached $37.5 billion in 2021, with investments primarily driven by cloud migration for more effective and efficient financial management processes. Technologies such as artificial intelligence, machine learning, and robotic process automation can provide the flexibility, cost savings, and strategic insight into the organization’s business that the CFO needs.
The current challenges that impact market volatility are not without impact on the fears of CFOs and 72.9% confirmed that the resilience of their business is a priority. 44% of respondents said the lack of visibility into financial data is a challenge and 70% of bank executives believe that the lack of reconciled data is a major barrier to providing timely information.
Respondents also cite environmental, social and governance (ESG) issues as a factor pushing the finance function to take on a more strategic role. The new sustainability standards aim to help organizations manage all of their ESG impact. This was also demonstrated by the study No Planet B.
But data management and profitability cannot be ensured without having the right skills “in-house”. More than a quarter (27.5%) of finance leaders cited the desire to attract and retain top talent to modernize finance processes. Finally, a significant number of respondents (27.5%) also invest in technology to make the organization more attractive to potential employees.
Large companies often favored
Examples of companies following suit abound.
Galderma decided to pursue an end-to-end transformation that implemented integrated business planning, freed up resources and pooled what could not be fully automated and streamlined into shared services, enabling the introduction of again. Deloitte led the digital transformation project, transferring Galderma’s on-premises business systems for North America operations, which constitute a significant portion of the company’s overall revenue.
Within months, with the world in lockdown, Deloitte and Oracle successfully bridged disparate international systems, allowing Galderma to standardize operations and deploy modern analytical tools that freed the company to to focus on its highly competitive core business. The platform now aggregates and extracts data from multiple ERP systems, from India to South America to Russia, enabling Galderma finance managers to have a single source of truth for all reporting and analysis financials, as well as real-time visibility into business performance across all of these geographies.
Fedex can analyze operations in near real time, see what’s going on and assess developments around the world with advanced analytical tools.
According to a recent PwC study, 73% of the 522 CFOs surveyed in Switzerland and around the world say that the digitization of finance is a priority, but the digitization of the financial sector is only in its infancy for many companies. Technologies such as artificial intelligence or process mining are used more rarely. However, large companies with sales of more than 10 billion Swiss francs often have both the budget and the right personnel to access these technologies.
What is certain is that CFOs and the finance function as a whole will need to modernize their organizations to cope with the macroeconomic changes that will continue to shape this dynamic industry.
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