Digitization is speeding up across all industries but it’s continuing to lag in the back-office, which can have a major impact on a company’s growth. The future of a business is beholden to the future of the finance department, and the role of the CFO is broadening as that realization takes hold. In fact, a recent PwC report found that 68 percent of CFOs are investing in technology to lead digital transformation in an effort to support workplace flexibility and culture – two things that may not have been part of the “normal” CFO purview, but have become even more imperative after last year’s major shift to remote work.
During this era of digital transformation, the elimination of manual processes has helped transform back-offices and subsequently businesses overall. The use of automation, specifically, to enhance back-office processes has emerged as an opportunity to help catalyze growth.
Technology &The Next Generation of Finance Talent
In a recent Deloitte survey, a sampling of finance teams were asked whether they saw themselves as leaders in leveraging digital technology. Less than one-third felt they exhibited the traits that qualified them as such. Interestingly, that small number declaring themselves digitally ready were from companies experiencing a faster rate of growth, which is no coincidence. The finance department is often overlooked when it comes to innovation because it isn’t customer or client-facing. However, it has a direct impact on the future of the business and controls the levers used to manage cash flow and where the business is investing, which directly impacts growth.
Looking to the future, the CFO-suite and operating models will need to adapt to the digitally savvy talent coming down the pipeline and the “new normal” these professionals live, work and breath in. This new normal will include implementing more technology and automation tools, fewer manual and paper-based processes, and embedding artificial intelligence and machine learning technology to expedite day-to-day tasks.
Automation & Growth: A Love Story
According to the Association of Finance Professionals, paper checks still comprise 42 percent of all business to business (B2B) payments in the U.S.; therefore, nearly half of payments sent via check are causing CFOs and finance teams to miss out on the three major growth opportunities an automation solution offers:
1. Reducing costs: The costs associated with printing paper checks, buying envelopes and stamps, and making trips to the bank can add up, especially if there’s a high-volume of payments. These dollars can be reallocated to projects, partnerships, technology, or other initiatives that further the company’s growth plans.
2. Increasing visibility: The paper check provides zero data, and therefore zero insights to improve future processes. Understanding where and how dollars are being spent, as well as where there’s friction within payment processes, can only help the business on its growth journey – more information and data is never a bad thing.
3. Refocusing team resources: Alleviating manual tasks and increasing efficiency gives the finance team more freedom to focus on strategy and sourcing growth opportunities for the business.
While the number of companies that identify themselves as leaders in leveraging digital technology may seem low, 88 percent of the companies implemented new technologies within the last year, according to a recent AvidXchange survey. Therefore, the stage is set for digital transformation to continue, and CFOs must respond by digitizing their own department to help finance teams push out the paper and move onto bigger, better growth opportunities for the business.