An organisation’s finance team will have to navigate business disruptions such as global pandemics, geopolitical unrest, supply chain disruption, increased focus on sustainability, an ever growing volume of regulatory requirements, and economic uncertainty. In all likelihood these challenges will occur simultaneously.
The need for the finance function of tomorrow, is here and now. This evolution of the role of finance is evident today across all industries.
At Deloitte we are seeing many of our clients, with great success, investing in future-proofing their organisations and applying our principles to build a more dynamic finance function.
An important role of a chief financial officer (CFO) is to ensure the finance function is focused on mitigating as many risks to their business operations as possible.
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Today, the number of risks are growing and the increase of external forces such as market shocks, industry consolidation, technology acceleration, and an even more complex regulatory landscape mean finance functions need to continually adapt.
This growing need for agility has led many CFOs to consider how their organisations can be flexible, adaptable and ready to deliver the required immediate change.
Shifting the role of finance: from a function to a dynamic capability
How does finance address a constantly evolving and dynamic business environment? In Deloitte we believe the answer lies in dynamic finance.
A dynamic finance function leverages innovation and technology to expand the capabilities of their teams.
It allows focus to be placed on valuable, impactful work leveraging data to drive business insights and influence business decisions.
The principles of dynamic finance can help CFOs transform finance from business function to dynamic capability, while still safeguarding and performing their steward and operator duties.
Equipping the finance function with these characteristics, embedded through a dynamic finance mindset, can turn a traditional support function into a competitive advantage, despite what uncertainty may arise.
The building blocks to unlock agility and adaptability
Finance as a function, has long been adapting to best serve business needs, using methodologies that support evolving business demands and allow for shifting priorities.
A question on many minds is, how do you become more dynamic? It is not as complicated as you may think, getting the core foundations right will set you up for success. These foundations are people, process, data and technology.
The building blocks to unlock dynamic finance capability, will allow you to react to any future disruptions at speed and accuracy:
· Tech-savvy talent: highly skilled and tech-fluent workforce. Invest in foundational finance skills while dialling up tech-savvy and problem solving. Train your workforce to maximise the data available to them and build skills in scenario modelling, trend analysis and analytical skillsets. Enable your finance teams to develop capacity to sense and mitigate business disruptions by identifying and measuring the business’s most important risks and performance indicators.
· Streamlined and automated processes: simplified and standardised processes help leverage your organisation’s technology to automate and reduce manual and tedious tasks, which will create capacity for your valuable workforce to focus on insights and decision making.
· Robust data models: foster nimbleness through a strong data strategy and governance model, with real-time access to data. Ensuring the finance function is well versed in how data is structured, created, maintained, secured, and consumed will be a true competitive advantage.
· Core technology compatible with best of breed platforms: leverage modern and compatible platforms and solutions that connect with your core enterprise-wide technology, combining your traditional operating system with emerging capability around robotics process automation, machine learning and AI. Validate and test your financial digital eco-system is fit for purpose to transform and scale with the business.
Finance as a strategic partner to the business
The role of finance is shifting from traditional accounting roles to more dynamic, agile and resilient drivers of decision-making. The strength of finance is in its ability to analyse and assess large data sets of information, crunching numbers and producing data driven insights, we are seeing many examples of how finance is elevating their core skill sets to be more dynamic in the marketplace:
· Financial Planning & Analysis driving real-time and adaptive decision-making for finance and its business partners: shift from collating large volumes of data and using offline tools to deliver traditional planning and reporting to harnessing the power of data and technology to create powerful insight and forward-looking capability.
· Operational efficiency that is agile: reduce the volume of manual transactional processes through technology to automate activity and simplify processes that will free up capacity, provide near real-time visibility into business operations and equip your team to turn their focus to prioritised issues and working capital improvement.
· Dynamic Controllership delivering confidence in financial results and delivering insights to enable strategic business decisions: leverage automated accounting processes, controls, and harmonised data to shift human capacity towards business partnering and decision support, allowing the controllership organisation to be seen as a driver of growth.
· Insights generators in a changing regulatory landscape: the introduction of new and complex regulations puts finance in the driver seat to be an important asset to the organisation. New CSRD regulations require transparent financial data to be reported in a timely manner, and finance is the core enabler to accessing, monitoring, preparing, and reporting against these emerging requirements.
How to get started
Many of our clients are asking us the same question, “where and how do we start?”. In our experience, to be successful, start with what you already have at your fingertips and build from there:
1. Set the tone with strong leadership and a clear vision for the future of the finance function.
2. Build streamlined processes that enable the team to be more responsive and agile.
3. Validate your core systems and data to ensure the building blocks for success are fit for the task.
4. Organisations preparing for this shift in roles and responsibilities are focused on improving the coordination and alignment within the finance function, while promoting their new partnership opportunities across the business.
5. Invest now in creating a dynamic finance mindset that will become your organisation’s competitive and strategic advantage.
Finance functions that embrace the dynamic finance mindset will keep at pace with the organisation, attract top key talent, and make an impact as data-driven insight leaders. Deloitte’s CFO survey shows that finance teams are overwhelmingly in favour of these changes but interestingly two thirds of CFOs see the skillsets within their team as being a challenge to successfully implementing dynamic finance solutions. Addressing this capability challenge by upskilling the finance team is a vital part of the change, it needs to be business led and technology enabled.
Organisations will face multiple disruptions at some point, but by embedding the principles of dynamic finance new opportunities can be realised. The entire organisation will become dynamic as a consequence.
At Deloitte we have several tools and methodologies to help organisations navigate this journey. We offer immersive full day labs, where we bring your finance leadership teams through the core principles of being dynamic and assess where you are today and how you can begin your move to a more dynamic future.
To find out more visit Deloitte