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Slow economic growth, high inflation and energy prices, combined with global supply constraints and a talent dearth are putting increasing amounts of pressure on organisations. The quest to build profitability in the face of these turbulent market conditions, represents both a challenge and an opportunity for CFOs in particular. As well as keeping a keen eye on costs and mitigating risk, they must ensure resources are channelled into the most lucrative areas, leverage transformation initiatives and drive innovation to boost performance.
As the gatekeepers of business-critical finance data, CFOs play a pivotal role in capturing, harnessing and presenting a picture of business performance. However, whilst in the past this would have involved the collation of historical data, the modern CFO needs dynamic, meaningful insights from which to understand the ‘why’ behind the data and make predictions on the ‘what next’.
Digital is clearly key in harnessing these insights, testament to this is that according to a recent Gartner survey of CFOs and finance leaders, 78% plan to maintain or increase enterprise-wide digital investments in the next two years, despite indications that cost reductions in other areas of the business, are planned if inflation persists.
When asked about their intentions for technology spend throughout 2023, both within their function and across the enterprise, 46% of respondents said they are scaling up their digital plans, while 32% said that no changes were planned
Digital priorities vary from organisation to organisation, but typically involve embracing automation as a primary focus, to free up time traditionally spent on mundane, time-consuming processes, and free up resources focus on more strategic, value-add tasks. Many then look to explore the capabilities of BI, AI and machine learning in order to build on efficiencies, maximise the value and impact of digital across the department.
Take Accounts Payable (AP) as an example. An area responsible for onboarding suppliers; raising and approving purchase orders; and receiving, coding, and reconciling suppliers’ invoices, before scheduling; approving; and making payments, it’s fair to say that it typically commands the greatest proportion of manual, and often painful, processes. Few can afford to play fast and loose with their cashflow, so getting this into the best shape is crucial. If you consider the fact that invoices land in many forms, from physical documents, e-mails or links via portals. Once received they must be approved, checked, filed and paid. This involves reconciling every invoice against its purchase order and order details to ensure that it contains the relevant information, and is for the correct amount. Getting this right is crucial, as even one missed, or incorrect invoice, can cause mismanaged VAT or overpayments.
Automation can help tackle this process complexity, providing greater control, and mitigating the risk of errors, while faster processing of invoices and quicker payments helps to create better relationships with suppliers. Invoice capture via optical character recognition (OCR) to automate the scanning and processing of invoices in particular, is hugely valuable. A reduction in paper-based processes reduces the need for physical storage and expedites audits, while the ability to undertake AP processes from any location removes potential delays or bottlenecks and streamlines approvals. More collaborative working supports greater productivity, and the manual labour saved can be deployed in other areas, adding value to the wider goals of the department.
And of course, with a fully automated process, reporting can be taken to another level. The real-time insights generated boost visibility, contextualise information and ultimately facilitate better decisions. Monthly expenditure can be monitored more tightly, cashflow can be monitored more closely, and annual trends can be mapped and acted upon appropriately.
Through prioritising those areas which can deliver most value, and leveraging the benefits of modern, cloud-led solutions, many hours can be freed up and the risk of human error mitigated.
Even industries which are traditionally slow to adopt new technologies are embracing automation in 2023 in their quest to remain competitive in a rapidly evolving industry landscape.
As recent times have highlighted, we need to be able to continuously plan for the unexpected. Whilst we certainly can’t predict for definite what will happen, having a modern, digitalised finance function, which can deliver in-depth and comprehensive insights is rapidly becoming the new normal, with speed and agility crucial in being able to communicate, collaborate and respond to opportunities or anomalies in the best, most timely way. This agility has become the dominant currency when it comes to winning market share, businesses that can successfully embrace digital to this end, will be those that are able to adapt quickly to changing circumstances. Those who get their digital strategies right, will, without question, be in the best place to become the industry leaders of tomorrow.
If you would like to learn more about our new AP Automation software which is being released for Opera 3 SQL SE soon then please contact us today.
Posted On: May 25, 2023
