Stephen Hawking once said, “We should seek the greatest value of our action.” Following that sage counsel, finance teams should seek to spend more of their time on actions that create shareholder value, such as strategic and economic analysis, and less time on mundane tasks, such as data transformation, reconciliation, and report preparation.
Emerging trends in technology enable the finance team to focus on the highest-value activities and drive digital business transformation, including a new functional operating model. The finance function of the future leverages social platforms, enterprise mobility, and data science to address the insatiable desire for real-time analysis and partner with executive management to create competitive advantage.
“Social finance” is not an oxymoron. Many millennials are accustomed to collaborative communities with a sense of common purpose and a supportive structure. Workplace culture is rapidly adapting to these norms, as evidenced by various best-places-to-work surveys. Finance teams can be social, and in fact, the best analytics results typically come from close collaboration among visionary strategists, data stewards, and results-oriented team members looking to be catalysts for change.
At first glance, not many finance team members would say budgeting is a social activity. But when seen as an objective-setting and control exercise coupled with accurate forecasting, the financial planning process can involve many stakeholders who have expertise and discretion over business operations – including daily decisions that impact revenue, expenses, and capital investments. This “crowdsourcing” mindset and its network effects are profound. As more team members analyze data, communicate, and engage in building a budget and improving forecast accuracy, they have more “skin in the game” as it relates to financial performance.
The financial analytics technology that enables this teamwork includes a shared corporate calendar focused on processes, deliverables, and due dates; a chat feature for frequent and informal “hallway conversations”; and tools for advanced business modeling (with private versioning). All of this is packaged in one easy-to-use interface: the new killer app for finance teams.
Consumer-grade software is the standard for this new generation of finance professionals. It’s “table stakes” for them because they expect intuitive, visual capabilities and predictive calculation functionality in one space, without the complex menu maze of spreadsheets or toggling among desktop applications.
Finance has come a long way in its forecasting ability. Not long ago, manually running correlations in spreadsheets was considered advanced analytics. Now machine learning enables code to learn from data and make predictions. Tools to improve accuracy are now easy to use and enable the curious mind to pursue endless scenarios to hone the precision of the forecast.
In the current “consumerization of IT” zeitgeist, even financial analysts who aren’t statistically savvy can simulate actions, impact, and complex relationships with ease. These citizen developers are the players in the self-service movement where IT deploys the technology and finance develops and fulfills its own requirements. Whether it’s understanding demand curves, non-linearities, or social sentiment, artificial intelligence can produce a predictive scenario that does what human systems sometimes find challenging: moving beyond bias in predictions.
Although robotic process automation in finance will replace many accounts payable personnel who today manually match invoices to purchase orders, humans will still be needed to design, strategize, communicate, and express empathy when processes break.
With the advent of natural language processing, conversational interfaces will be as popular in the workplace as they are in the home. These chatbots will increasingly become the preferred mode of interaction in many financial analysis use cases.
Gone are the days of building triple exponential smoothing spreadsheet models. Welcome to the world of automated algorithms with prescriptive analytics.
With the evolution of technology, finance is reexamining the mindset of “batch mode.” Proactive finance organizations will produce on-demand results for the business. Continuous accounting that integrates journal entries, soft closes, and pro forma consolidation creates instant insight, simplifies reconciliation, and accelerates reporting.
New advances in hardware and software enable immediate, visual, and suggestive analytics that not only shorten the data-to-decision cycle, but also drive cultural changes. Managers will expect decision-support timelines to be drastically compressed.
Executive management sessions, including those in the boardroom, will move away from hard-copy handouts to visual presentations with live data that allow scenario-modeling capabilities, dramatically accelerating strategic decision making.
People love and need stories. And every good story needs a picture. New technology brings automated visualizations of financial data that go far beyond bars and pie chart representations created manually from rows and columns of data. Now one click away are sophisticated geospatial and multidimensional illustrations that intuitively explain what would take many more words and much more time to read and comprehend.
Social anthropologists can debate whether our attention spans are getting shorter – although there is no doubt that visualizations enhance communication and help audiences explore, discover, and develop insights otherwise difficult to glean from complex data relationships.
People can just filter and drill into data to get quick answers to business questions. It is now easy to build insightful data visualizations, business intelligence dashboards, and storyboards using best practices and proven design standards to help engage and inspire an audience. And with a mobile-first design approach, business stakeholders anywhere in the world on any device can interpret and act on compelling views that couldn’t have been imagined just a few years ago.
By leveraging emerging technology trends, finance can accelerate the journey to becoming a true business partner and focus more energy on the actions that count.
Find out more about how technology can enable better decision making in How AI Can End Bias.