Digitalization is changing the business world, and the finance profession must change right along with it. This finding was at the core of a recent CFO Research study, based on a survey of 1,544 finance professionals around the globe. Sponsored by SAP, the study sought to gain a better understanding of the outlook for the finance function and what finance professionals see as the key enablers of their future success.
Digitalization is the process of transforming any kind of activity or information into digital formats that can be collected, stored, retrieved, and analyzed electronically. The data can include anything from real-time sales figures to local weather patterns to vast amounts of unstructured social media posts and email messages. Ultimately, digitalization is all about using digital technologies to transform business models and develop innovative, new revenue opportunities.
The survey found that fully 85% of respondents agree that, over the next five years, their companies’ success will increasingly depend on their ability to adapt to the rapid pace of change and greater business complexity. For 84% of respondents, success will also mean being able to translate the flow of data into swift and decisive action. The study’s in-depth interviews with finance executives provided further clarity on how digitalization is impacting the finance function.
“Every day we have access to more data,” says Marcello Botelho Rodrigues, Global Controller Director for the global mining company Vale, which is headquartered in Brazil. For that reason, he continues, “the information technology has to enable us to transform that data into real information … from making information available on our mobile devices, to having the agility of running on platforms based on in-memory concepts.”
Jennifer Thom, Regional Finance Manager at the accounting and consulting services firm BDO USA, notes that, these days, “managers expect accurate, real-time information at their fingertips.” That means a change in how finance teams work. “The month-end close looks at history,” she notes, “but [managers] need a look toward the future, or even at the current state—what’s happening right now.”
Digitalization and advanced technology give the finance professional the means to deliver on these new demands. Says Rodrigues, “[The technology capabilities] will allow us to be more predictive, to react faster to the scenario, and better face the uncertainties.” And that’s critical to using today’s information to be prepared for tomorrow’s challenges. “Nowadays, we react and are prepared for a specific risk,” Rodrigues explains. “But that doesn’t mean you are prepared for a new scenario, a new situation, the uncertainties, and how adaptive you are to the changes of the market and the customers.”
In the view of Alejandro Scannapieco, CFO of the Argentina-based software company Globant, “Technology will turn information into a commodity, so an expectation on the finance function is that we’ll spend most of the time providing added value to the business—being more of a strategic partner than a data-gathering function.” By taking full advantage of the capabilities offered by digitalization, the modern finance professional can ensure that he or she is doing the work that provides the highest value to the business.