The definition of finance modernization varies. In some instances, finance modernization involves minor upgrades to everyday finance processes and systems. Or, finance modernization sometimes involves the use of technology to help a finance team extend its reach within a business.
Trevor Childers, RVP of Pacific Southwest at Anaplan, shared his thoughts on financial modernization during a Fireside Chat with Dean Ditto, Vice President and Corporate Controller at OSI Systems, at the 2018 Financial Leadership Forum in Los Angeles on May 22. During the Fireside Chat, Childers provided insights to help finance professionals maximize the value of their everyday processes and systems and technology investments.
“Finance modernization has a lot of different meanings to a lot of different people,” Childers pointed out. “Some people are merely looking to upgrade their [finance] systems … others are vendors that are trying to create marketing coverage.”
Although many technologies are available to finance professionals, not all of these technologies are created equal. For example, artificial intelligence (AI), machine learning and other state-of-the-art technologies empower finance professionals like never before. Yet finance professionals must understand how new technologies work and implement them properly. Otherwise, finance professionals risk devoting significant time and resources to use technologies that fail to help a company achieve its goals.
“Within finance today, we see a lot of new technologies that are fantastic and we will eventually rely on,” Childers stated. “But at the same time, the fundamentals below these technologies … show it’s just not the right time for these technologies.”
The goal of finance professionals is to provide fast, efficient and dependable support within a business, regardless of its size or industry. Technologies should help finance professionals become valuable contributors within their respective businesses. However, technologies sometimes make it tough for finance professionals to accomplish daily tasks in a timely fashion.
If finance professionals consider technologies that can be used to drive meaningful business improvements, these professionals could reap the benefits of best-in-class technologies for years to come. In addition, finance professionals must choose technologies that support their everyday processes and systems. The right technologies empower finance professionals with relevant data and insights, and as such, can help these professionals make quick, informed decisions. They also can eliminate the need for Excel spreadsheets that sometimes overwhelm finance professionals.
“Every single meeting, I feel like I know what people are going to say, because it tends to be the same thing over and over again,” Childers stated. “But if you look at all the different plans that exist … we’ve ended up with large investments in technology used with thousands of Excel spreadsheets. And that has fundamental flaws.”
Finance modernization requires finance professionals to differentiate value and non-value activities, too. In certain instances, finance professionals devote time and resources to perform activities that fail to help a company accomplish its desired results. Conversely, if finance professionals can identify value activities, they can dedicate the necessary time and resources to complete these activities. As a result, these professionals may be able to get the most out of the time and resources available.
If finance professionals maintain open communication with multiple departments within a company, these professionals can reduce the risk of business problems down the line. Perhaps most important, finance professionals can work with various departments to help a company thrive.
“We’re not just pieces in a human chain of information,” Childers said. “What we do as a company is not finance-specific … and we need to define the systems and processes to measure our success and make it repeatable.”
Data is readily available to finance professionals and others within a business, and this information should be accessible to all departments, at all times. With a data-driven approach to everyday operations, finance professionals and others can obtain meaningful business insights. Then, finance professionals and other departments can use these insights to help a company streamline its operations, drive revenue growth and achieve the best-possible results day after day.
“If you want to create a more collaborative environment, you need to make data available and share it with other people within a business,” Childers pointed out.