The FP&A Trends Webinar: The Winning Formula for FP&A Storytelling
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The FP&A Trends Webinar: The Winning Formula for FP&A Storytelling
Click here to view details and register
By Belal El-Shaf'ei, Financial Planning & Analysis professional
Ask anyone working in the finance field now, how much time you consume in some manual tasks; such as data entry, accumulation & validation of data, accounts reconciliation & preparing some basic statements or reports. Unfortunately, statistics say that more than 35% from Accounting & Finance Teams spent from 50 to 70% from their time on manual processes & data entry on ERP systems!
At the same time, ask anyone outside the finance field: "What's the job of someone working in Accounting/Finance department?" and the most popular answer will be; someone entering data into the ERP system, working on multiple Excel sheets trying to build a customized report out of the system and isolated from business managers & decisions makers.
This's briefly the current relation & biggest challenge between Finance Teams & Business Managers at many companies that can be solved easily through Finance Transformation.
Usually, Automation is the most popular definition that comes to your head when you hear about Finance Transformation. But actually, the term is much broader and may vary based on the situation of each company.
Generally, Finance Transformation is the combination of Technology, Business Process Automation, Performance Management & Data Analytics which can help in achieving the overall objectives & strategy of the company and improve the overall value of the finance department.
Working for specific objectives that integrated with the company's vision & strategy will make people in finance feel that they're important to the company and will keep them motivated to achieve the company objectives as well. Unfortunately many finance teams think they're just working to maintain clean books & records, however, Finance should be a decision support & value-added function in any company.
After finalizing the automation & control process for the full accounting cycle, your accounting team may have some spare time or you'll find that you've some extra staff. Don't make quick layoff decisions. Develop them to become finance business partners or business analysts...
Simply, "Diversity makes Experience". Keeping your finance team diversified is very healthy for the company & for them as well. Promote teamwork spirit and avoid making a lot of sub-functions inside the finance Dept., let them work together to achieve the goal together.
Learning & Development: The skillset of the finance teams has changed a lot during the last few years and with the continuous revolution in technology; any Finance Team must have a growth mindset in order to be updated with all new technologies and to stay relevant in a very competitive market. Online learning channels made the learning & development process so much easier for all of us.
Whether your business is small or big if you don't have a strong FP&A function; your business will suffer. Financial Planning is really a critical point. Imagine if you don't have a realistic sales & cash flow plan for the next year or even the next few months?! "If you don’t know where you’re going, then any road will take you there" - Lewis Carroll.
If you already have all the capabilities to build a strong finance Dept., but you don't have the right communication & culture you're dead! The right Communication outside your finance Dept. will transform it to be really a value-added function. Talk with sales & marketing people, understand their needs, give them some insights and let them know that you can help them to achieve their goals.
Culture is a much broader topic that involves many levels in the organization structure and usually start from top management or "setting the tone at the top", but from Finance perspective; if the finance team succeed to build a culture of Analytics inside the company that depends on data & analytics, you will lead the company to be a data-driven decision and reserve a continuous seat for Finance in the senior management table.
Corporate performance management that sometimes called business or enterprise performance is usually concerned with measuring the progress towards the overall goals through some KPIs, this includes also the annual budget & forecasting process and variance analysis reports.
Business Intelligence is a new game-changer in the finance function that uses advanced & real-time data analytics not only to measure KPIs but also to provide insights, create data visualization reports that tell a story behind the data. BI also can play an important role in the forecasting process using some forecasting models & Add-ins which powered by machine learning technology.
The finance function has changed a lot during the last 2 years, but the change will be even dramatically during the next few years and Automation is coming to eat a lot of jobs in the accounting profession.
Finance teams must focus more on the new technologies & skillsets for finance to stay relevant in a highly competitive market; such as "Strategy, Business Planning & Analysis, Data Analytics & Visualization, Financial Modeling & Valuation, Business Process Automation,...etc".
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