As per a recent study, global RPA (Robotic Process Automation) software revenue is forecasted to reach $1.89 billion in 2021.
Another research states that almost 75% of executives fear of going out of business within five years if they don’t scale artificial intelligence.
A report that studied global enterprises states that 81% of total enterprises have a multi-cloud strategy already laid out or in the works.
Changing markets, growing competitions, tighter margins, and increasingly stringent regulatory policies compel C-suite employees such as CFOs to help their companies evolve.
The legacy systems that are making the processes slow, repetitive operations that frustrate employees, manual workflow that make the functions error-prone, and other such problems cannot be ignored.
To improve efficiencies, accelerate processes, reduce manual errors, optimize operations, and enhance ROI, the CFOs must adopt digital transformation.
The Chief Financial Officers need to follow a strategic approach by analyzing gaps, opportunities, risks, changing business ecosystem, and much more to drive digital transformation. This approach must include the following pointers.
Why should your company embrace digital transformation?
Financial officers must evaluate the impact of digital transformation on overall business performance and its influence on ROI. Leveraging digital engineering services is essential in this process, as they enable organizations to modernize legacy systems, optimize operational workflows, and deliver superior digital experiences. A clear understanding of the strategic purpose behind digital transformation empowers executives to revamp outdated value chains and reimagine the company’s value proposition in alignment with evolving customer expectations.
Many companies still feel that adopting digital means incorporating a new mobile app or new accounting software. However, they must know that it is all about transforming the entire financial ecosystem that will disrupt the financial operations and affect other departments.
Role of CFOs in digital transformation
Once the importance of digital transformation is known, it becomes more accessible for the CFO to plan the action forward. But before that, he must be clear about his role in driving digital transformation.
His role must revolve around preparing achievable milestones, monitoring the progress, tracing activities, managing expenses, and more. Tracking end-to-end activities and progress will help him trace whether the transformation process is on the right track. If not, what other measures and practices can be included in the plan.
How can data analytics help?
Finance is the heart of the company. In the ever-evolving finance ecosystem, the financial directors need to focus on the power of data analytics which is the major aspect of digital transformation.
- Why is it significant to analyze data for the business?
- What are the necessary outcomes that they can expect out of it?
- Which technologies help gather, manage, and analyze business data for a decisive boost?
Data analytics empowers CFOs to drive insight-driven business transformation by uncovering valuable insights, improving decision-making, and aligning financial strategies with business goals. It helps centralize data, reveal trends, and turn information into a strategic asset.
Train professionals
Embracing a new technology needs a skilled and trained workforce. Digital technology thus requires trained professionals who understand the need, their respective roles in the transformation process and is encouraged to learn something new every day.
Therefore, CFOs need to take care of the training sessions and the similar needs of the professionals. This states that the financial officers surely do not want to burden the workforce with responsibilities that they know nothing about.
Automate finance
CFOs need to focus on transforming their department. A recent survey states that 60 out of 100 finance executives invest 20% of finance budgets in digitizing their department’s operations.
Companies nowadays are encouraged to eliminate manual and monotonous and automate finance processes such as accounting and billing, analysis and reporting, quote-to-order, procure-to-pay, tax filing, payroll management, and more.
Experts majorly use new-age software powered by automation, artificial intelligence, machine learning, and more. This helps improve financial forecasts and cash flow, close the books faster, enhance the accuracy of internal accounting and decision making, and put finance staff in higher-value strategic roles.
Conclusion
From understanding what digital transformation is to what it can do to the company, CFOs are central to strategic decisions about transformation. While it can be challenging for the company to embrace new and innovative amid the change, CFOs must advocate digital transformation to take the company forward.
CFOs can ensure investments impact every aspect of the business and drive more engagement and commitment from business leaders, assuring improved outcomes.
Author
Krunal Shah
Senior Tax Expert
Krunal is a member of the Institute of Chartered Accounts of India, a Certified Management Accountant, and a management graduate. With a background in finance & taxation and years of experience advising clients on intricate tax matters in India and the Middle East, he brings a wealth of financial acumen and regulatory insight to the world of taxation. At Cygnet.one , he heads the managed services, ensuring timely tax compliance for some of India’s finest corporates. Through his published works, he simplifies complex tax concepts, making them accessible to a broad audience and empowering readers to navigate the intricacies of taxation with confidence.