Most business leaders agree that digitalization, which entails turning manual processes to enhanced, automated ones through digital technology, is essential for long-term business performance. In fact, 91% of all companies have some kind of digital initiative underway. Top-level executives, in particular, recognize the need for process automation. According to a McKinsey Digital Quotient survey from April 2019, 93% of executives state that digitalization is critical to achieving their strategic objectives. Since that time, however, the urgency toward digital solutions has dramatically increased. A recent Gartner report revealed that 69% of board of directors claimed they saw an accelerated need for digital transformation due to the pandemic, yet another Gartner study stated only 40% of companies had actually reached that goal. A 2020 Deloitte study corroborates that digital maturity leads to higher business performance.
It is clear that digitalization, when done well, provides measurable business value. While business leaders are claiming they need or want digitalization, why are so many not embracing it fully? Clearly, Digital Transformation is seen as increasingly critical for long-term business success, yet it brings with it a pressing requirement for greater agility, improved visibility and more efficient end-to-end processes across the organization. It sounds complicated. But it doesn’t have to be. Taking your company’s temperature on its digital readiness can ease the process considerably. Below is a checklist to match against your current situation.
While executives have more or less affirmed the need for digitalization, getting employee buy-in is often a different matter. Showing your employees the benefits of moving into the digital realm is key to creating the support you will need for successful Digital Transformation from the inside out.
With strategic local payments partnerships and a global team of over 300 people, PPRO is the industry’s trusted provider of local payments infrastructure. Companies at the forefront of payments technology leverage PPRO’s unified platform, expert services, and local payment methods to boost sales in over 100 e-commerce markets worldwide. In 2020 alone, PPRO processed over $11 billion for its customers, including companies such as PayPal, Worldpay, Citi, Mollie, and many others.
The successful digitalization of PPRO’s planning process into a singular, unified solution required a high level of collaboration. Not only the finance department, for instance, but many other departments as well. As a result, 60 users in 15 departments across 20 locations around the world routinely collaborate using a modern digital solution for their daily planning, reporting and analysis demands. Thanks to the architecture of the solution, their FP&A processes are now truly unified, allowing for better collaboration and transparency across the entire organization.
Question to ask: How can your company culture shift to embrace more collaboration and transparency?
While buy-in on all levels of the organization is an essential component to building collaboration, one of the greatest stumbling blocks for enterprises today is siloed data stuck in multiple departments without automation or streamlined integration to keep decision-makers informed in real time on all relevant data.
Checklist: Data silos
According to a recent MuleSoft study, 89% of IT leaders targeted rigid data silos as the main reason Digital Transformation initiatives failed. Solutions that provide cross-departmental access to data breaks down those silos allow for a more cohesive, collaborative approach. Turning data into insights is simply smart business. It creates a stronger basis for data-driven decision-making.
Enhanced, modern FP&A solutions dramatically reduce the necessity for writing extensive code and scripts, which bring back the focus on value creation for the Office of the CFO, in particular. With the financial impact of the global crisis still palpable for many organizations, executives have to consider the heavy load that implementation and overhead costs may have.
Questions to ask: Can your top FP&A talent easily use the tools designed to make their jobs easier and more effective or do they have to lean heavily on IT resources? In other words, how rigid are your silos?
After setting your people and data collaboration requirements, it is best to examine your automation expectations to determine your organization’s digital readiness. It is the foundation upon which everything else rests.
In one study commissioned by CFO Research and FTI Consulting, 52% of the surveyed executives viewed eliminating and automating manual processes as a high priority or critical priority. Another 40% said the pandemic had a significant impact on cost management, financial planning and analysis, budgeting and forecasting. And more than one-third of the survey respondents said that technology adoption, accounting and financial reporting were greatly affected. But only 27% said that at least one in five members of their finance team were working virtually, which suggests that automation has not reached its full potential in most organizations.
Question to ask: Where is your organization on the spectrum of automated processes?
A note of caution: Fast, efficient planning and forecasting increasingly requires the automation of processes and activities. However, against the background of increasing dynamics, automation must be evaluated critically. Not everything that can be automated should be automated. Stable and generic areas should be automated as far as possible. Areas that are subject to frequent changes require flexibility that automated processes cannot always provide.
Automating data and human collaboration increase agility and resilience. Those are key as the evolution of an organization’s financial health continues. Other tools such as Artificial Intelligence (AI) and machine learning tools take automation to the next level.
Checklist: Artificial Intelligence and Machine Learning
AI and machine learning tools are transforming the finance function. Modern CFOs will recognize the need to bring people and intelligent machines together to strive toward mutual objectives. Data is indeed the new currency, and businesses that analyze data from multiple sources in real-time will have a competitive advantage. CFOs can leverage AI capabilities in their Digital Transformation journey to achieve higher quality insights and automation in planning, budgeting and forecasting, along with recommendations for improving performance management. AI and machine learning can help decision makers identify key drivers for simulating the future of the business.
Question to ask: How time-consuming are your manual processes right now?
Checklist: Customer experience
Perhaps your culture has been shaped to embrace Digital Transformation and the proper processes have been put into place. Are your customers ready to engage with you in a digital fashion as well? Surveys show that digital readiness, when done well from the inside out, has positive client-facing results. In fact, customers are driving Digital Transformation through their growing need for a personalized customer experience. According to a recent HBR study, 40% of companies surveyed claim creating a highly valuable, exceptional customer experience through digitalization is their number one priority.
Question to ask: How can digitalization enhance your customers’ experience?
When correctly implemented, the Digital Transformation journey benefits more than just the bottom line, but the people who contribute to it as well. No matter where you are on this journey, the world has gone digital. It is in the best interest of businesses large and small to do the same.
Commentary by Dr. Liran Edelist. Here’s what you’ve missed?
Best Hospitality And Hotel Management Schools In The World For 2021.
Best Fashion Schools In The World For 2021.
Best Business Schools In The World For 2021.
Best Medical Schools In The World For 2021.
Track Latest News Live on CEOWORLD magazine and get news updates from the United States and around the world. The views expressed are those of the author and are not necessarily those of the CEOWORLD magazine. Follow CEOWORLD magazine on Twitter and Facebook. For media queries, please contact: firstname.lastname@example.org