Technologies such as automation, analytics and cloud platforms have fundamentally changed how finance and accounting (F&A) services are delivered today. Finance and accounting services outsourcing is no longer limited to point transactions because enterprises want to partner with providers that enable improvements to the decision-making process. Enterprises must look for transformational options while outsourcing, and importantly, incorporate digital components to reap the benefits of transformation.
While transformation is a combination of people, processes and technology, in this blog we focus on technology. At ISG we believe that the following technological advancements are instrumental in transforming the delivery of F&A services that were once labor-intensive processes. Embracing them holistically and not choosing one technology over the other is the best approach. The technologies highlighted below complement each other to make service delivery seamless, thus enriching the customer experience.
- Cloud technologies. With cloud technologies, CFOs can access data in real-time, anytime, anywhere, and with low overhead costs, thus enabling quicker decisions. As cloud solutions have matured they have developed more benefits to offer. Cloud solutions bring cost benefits, help enterprises get rid of legacy IT systems and make the IT operation more efficient. Cloud has a flexibility component that is unmatched by on-premise solutions. With cloud solutions, change is quick and easily adaptable. In addition, this asset-light approach supports one of the biggest benefits: visibility. With cloud solutions, CFOs have greater visibility into real-time financial information, which enables faster decisions, especially when professionals are on the move.
- Analytics. Finance is the heart of any business. CFOs are required to drive their businesses with numbers at the tip of their fingers. The CFO role has changed from a heavy emphasis on mere bookkeeping to that of a strategic CFO. Having visibility across departments on spend, costs, savings, cash flow etc. is extremely important. With multiple departments and several types of transactions within these departments, going through hundreds of spreadsheets for meaningful insights is a tedious task. Analytics play a crucial role in bringing those meaningful insights to the CFO’s table, enabling quicker decisions and greater visibility into what to expect. Analytics are also extremely important for financial planning; they help the typical CFO to transform into a strategic CFO and focus better on core business requirements.
- RPA. CFOs can now rely on automation that enables accuracy, risk reduction, improved time to market and speed, thus having a broad impact on improvisation of processes in a cost-effective manner. ISG research indicates that robotic process automation (RPA) adoption is highest for finance and accounting outsourcing, where clients have tasted the sweetness of its success very early in the game compared to other services. F&A is process heavy and manually driven. Through RPA, many of manually driven processes have been automated. A year back RPA was talked about as an emerging technology in this space, but today it has become an integral part of how F&A services are delivered. From faster processes, to better accuracy to greater efficiency, the benefits of RPA in F&A practices are very evident. Robotic process automation drastically reduces human efforts, thus saving people time for more complex problems that require their intervention.
CFOs are looking to build better financial strategies for their enterprises that align with broader organizational strategies. Their role goes beyond bookkeeping or controlling finances. Aligning themselves with broader organizational strategies and contributing to critical decisions is becoming increasingly important. To empower today’s CFOs to grow to be strategic partners, it is important to empower them with the real-time and insightful information that technology offers today. Transformation is no longer a choice, but is an essential component of services, and is it broadly enabled by technology along with people and processes.