A recent Deloitte study of 600 global business leaders revealed that companies are spending half their time creating and updating reports. As a result, only a fraction of their time is spent on the far more valuable task of data analytics. This is an inbalance which costs companies timely and important insights. Insights which could, according to Matt Soderberg of Deloitte Consulting LLP, reporting on the results, “prove vital to the business.”
Indeed, according to a study by PWC, even in the top quartile of companies, analysts spend 40 percent of their time gathering data. This leaves little room for advanced analytics which, this study agrees, could be bad for business.
Not only is an antiquated approach to data gathering slow and time-consuming. It means that reports are often out of date by the time finance teams receive them to analyse. This can lead to delayed and inaccurate decision-making. The old method is also expensive, as manual processes eat into staff hours and reduce the capacity and efficiency of the finance function.
What’s the solution?
So, what can a cost-conscious CFO who wants to free up time for advanced analytics do? The solution lies in the growth of new technologies including automation, machine learning, artificial intelligence and robotic process automation (or RPA).
In brief, these technologies streamline financial reporting processes, allowing finance professionals to focus on making better decisions with more accurate data more often.
A good example of automation in practice is Payslip, an automation and integration technology which uses automation to streamline payroll operations but also to supply data for consolidated global payroll reporting. Payroll is an area where dozens of different data feeds require automation to ensure reporting data is accurate and standardized in such a way that it can be centrally managed. Users benefit from real-time reporting, predictive analytics and comprehensive reports that can be scheduled and customized.
Led by CFOs
Soderberg asserts it’s up to CFOs to lead digital transformation for their company. With their strong C-suite relationships and operational insights, they possess both the business clout and holistic understanding required to make a success of such a change.
CFOs willing to undertake this revolution will be rewarded, he says. “Get ready to work smarter, faster – and maybe even more happily.”
The power of automation?
One way to work smarter is to use software which makes your life easier. Automation software is one answer because it saves time and money, reduces the likelihood of human error and delivers reporting from a single source with the touch of a button. In the world of global payroll, Payslip technology automates payroll processes and standardizes payroll data.
As a result, employees have more time for strategic work including predictive analytics and risk management.
Amongst CEOs, 82 percent cite uncertain economic growth as the biggest concern for the future of their business. But with more time to spend on analysis, financial organisations are in the best possible position to weather any storms.
In addition, the data gathered will be of higher quality. Teams can receive and analyse it in real-time on demand, not just at the end of the week or month. The data itself will be more accurate as manual data entry will be all but obsolete. Elizabeth Dixon, the Director of Enterprise Data at GlaxoSmithKline asserts, “The benefits for improvements in data quality are business critical across the board.”
Automated processes allow businesses to work faster. Payslip, for example, offers users a single, automated workflow. All global payroll processes are tracked from end to end with a full audit trail. Each user has self-service access to a customised dashboard of selected data sources that frees analysts from the old-style reporting cycle.
The timeliness of insights and decisions is improved immeasurably. Financial data can be called up and reviewed at the time the decision needs to be made.
Additionally, the automated process is more cost-effective. Human capital spend drops as a result of time savings, and better business decisions are made. PWC estimate this cost reduction to amount to between 35 and 46 percent.
There’s no doubt that finance departments freed from slow and time-consuming manual data entry are going to be happier places to be.
As Patrick Benson, Chief Information Officer at ClubCorp put it, “We’re looking for the systems to take out a lot of the heavy lifting from finance’s work, the day-to-day noise that can distract people from thinking strategically, because they’re so exhausted from dealing with the tactical.”
Automating global payroll operations with a technology platform such as Payslip means that payroll/finance teams have to deal with fewer mistakes.
Finance professionals have more time to learn new skills and develop the more interesting and rewarding aspects of their job. They will enjoy increased job satisfaction. But even better, they will be more promotable and more employable when it’s time to change companies.
As the much-cited business mantra goes, “What happens if we train them and they leave? What happens if we don’t and they stay?”
And if you don’t automate?
Finance leaders that don’t factor automation into their company strategy risk losing out to competitors who are receiving the full benefit of big data insights. A non-automated financial organisation will run at low efficiency, costing the business time and money which may effect total company value. Finally, without the predictive financial data that automated analytics offers, businesses may be ill-prepared to handle change, expand or enter new markets.
Challenges to overcome
Of course, automation and digital transformation are not without their challenges. CFOs need to assess the existing infrastructure, workforce, processes and culture in order to organise successful change management, according to Soderberg.
He suggests that a successful transition should be founded under “three organizing principles.”
Effective change management
“The biggest risk on a transformation journey is that you don’t take the organisation with you. Otherwise, you arrive at your destination, but you’re all alone.” So says Gerd Graehsler, Group CFO of the Safilo Group.
The first step is to reassure teams that the computers aren’t replacing them. Indeed, according to PWC’s Finance Effectiveness Benchmark Report 2017, staff pay actually increases by 25 percent following automation. Staff can also look forward to a new, faster and more efficient working environment.
As CFO, you may need to assess the current skillset of your staff and lay down a hiring strategy. It’s essential to ensure you have the relevant talent on board to see the change through. Top candidates should possess agility and critical thinking as well as technological know-how.
Enterprise Resource Planning System
Assess your existing ERP set-up and plan transformation in a way that feels appropriate. That may mean starting small. Pick an easy win, for example the most time-consuming task your team face. This will act as an example for the rest of the business as well as a trial for you and your team.
When undergoing change, remember that it will take time to see a return on investment. Though the initial costs may damage your immediate cash flow, the long-term benefits, including stronger strategy and better use of human resources, promise a decent return.
On the whole, CFOs report a saving of around 36 percent according to PWC, simply because of standardised reporting and simplified systems and processes.
The results speak for themselves. Top performers spend 20 percent less time gathering data following automation. For CFOs, this is an exciting opportunity to unlock resources already latent without your business to deliver better decision making, better people management and better costing.
For more information on reporting and analytics available on the Payslip Platform contact us today!