The 4 key areas for power finance automation
In today’s highly complex business environment to make an efficient Finance Automation journey,
we must start with a full approach and look at four key areas:
Processes, Technology, People, Information.
Organizations are prone to make mistakes because they are run, organized and managed by humans, that is a fact. These mistakes are frequently caused by an obsolete, manual, and spreadsheet-focused approach to accounting and finance operations which is a process that restrains visibility, scalability, and productivity, and results in high risks.
Efficiency, better insights, and responsiveness are some of the benefits that custom-made accounting and finance technology are delivering to enterprises.
Failing to automate finance processes leaves companies at disadvantage. New process automation tools free up time for analytics, enabling finance teams to transition from performing manual and spreadsheet-driven processes to strategic, value-adding operations.
The results of using automation are already impressive, with companies seeing faster close cycles, increased accounting efficiency and transparency, and more satisfied and engaged finance and accounting teams. It is a new paradigm. It is the way modern business is done. Automation is not an option.
To better understand the power of automation, we are going to take a deep dive into these four key areas and present just a few of their benefits in this process.
The first step towards Finance Automation is to look at all internal processes and begin making a list of enhancements. Open conversations with all stakeholders involved, especially the accountants who perform the manual tasks may bring good ideas about how to streamline existing processes. Usually, the first procedures of the process are the most manual and risky but also the easiest to improve and automate.
Four benefits of Process Optimization
- Standardization allows process control and prevents inaccuracies at every level.
- Control, resulting from standardizations, leads to a decreased risk of error, higher quality financial reporting, and results that can be trusted.
- Efficiency resulting in closing the books faster and saving time that can be reallocated to further optimization.
- Continuous Improvement allows companies to continually refine processes to meet the dynamic needs and enhance data quality along with productivity.
According to the IBM Institute for Business Value, more than two-thirds of organizations see their current IT processes as inadequate for easily managing controls and reducing risk. Some of the key risk factors are aging infrastructure, old ERP systems, multiple systems of record, spreadsheets, and systems that do not work together and require manual re-work. ERPs do a lot already but were not built to do everything, pushing accountants to perform many critical functions within spreadsheets. This manual work is repetitive and error-prone, making it difficult to guarantee the accuracy of a company’s financials or to have visibility into the quality of financial processes. Beyond risk mitigation, automating financial close is critical for keeping the pace of changes. One of the concepts defended by low-code since the beginning was that it is possible to develop fast and inexpensively, without taking a significant toll on quality. Some initiatives were critical in rendering this ambition possible:
Four benefits of Technology automation
- Efficiency is enhanced as high-volume tasks from transaction matching to account reconciliations are automated and data aggregation and formatting are streamlined.
- Risk is reduced as control increases and human error is removed from manual, transaction-level processes, including data extraction, recurring journal creation, and intercompany invoicing.
- Accuracy and quality rise not only as automation executes error-prone tasks, but also as exceptions and anomalies can be better investigated by accountants freed from manual activities
- Visibility reaches new levels as disconnected spreadsheets are replaced with technology that automatically reports task progress, close status, and real-time financial results.
PEOPLE’S PERFORMANCE OPTIMIZATION
The emerging idea that automation will replace accountants fails to properly value the fact that higher-level accounting is complex, and only strengthened by automation. Process automation helps to complete unskilled tasks, enabling skilled individuals to provide strategic services to both their department and the entire organization. Automation frees accountants to be more efficient and effective. It frees them to be exceptional.
Four benefits of People’s performance optimization
- Close faster by removing manual bottlenecks and freeing the team to investigate exceptions, not process transactions.
- Increase productivity gains realized from process automation.
- Improved engagement so that teams feel more satisfied with their work, which leads to reduced turnover (and associated savings!)
- Strategic redeployment opportunities that enable your most capable team members to focus on value-adding activities.
In modern business, the need for transparency and auditability is growing, and increasingly volatile markets are exposing the necessity of up-to-date financial data. Automating the finance function not only improves the efficacy of back-office activities but creates time for reporting and analysis to be done at the point of need.
Real-time access to financial data and confidence in the numbers is the way forward, especially with the increasingly complex regulatory guidelines and the surging amount of data companies are expected to analyse. By automating finance processes and leveraging the power of the available data, organizations can unlock competitive advantages and distinct benefits for the finance function and the entire organization.
Four benefits of information optimization
- Enhanced Visibility coupled with automated data aggregation, standardization, and integration; organizations gain instant access to up-to-date data.
- Better Decision-Making. Better data and analysis mean business decisions are better informed.
- Real-Time Intelligence. Companies benefit from having information at hand when it is needed.
- Agile Business Operations. With faster analysis and informed decision-making, leading businesses can be more agile and respond quickly to challenges as they arise.
The risks associated with doing nothing are too high and costly. It is time to gain confidence in the accounting processes and insight into finance operations.
Indeed, the first step is the hardest, but a journey always begins with a single step.