This posted Forbes piece is on the same space we have been advising about for the past several years, most recently in a member paper on the cash cycle and automation thereon. In that piece we made the following statement:
“The increase in latest generation technology across financial operations has been most noticeable in the payables space, followed by receivables, both with heavy emphasis on digitizing invoices to create more STP. Trade finance has become even more important in the chase for liquidity and keeping supply chains healthy. Until recently the procurement process has been viewed more as a one-off operation, not necessarily directly connected to the full financial operations flow.
However, that is starting to change through an increased recognition that a data feedback loop from the other financial processes can result in better pricing and supplier evaluations. Based on our industry conversations, it is clear that robotic process automation, machine learning (AI) and even blockchain technologies are working their way into the mainstream, including in procurement.”
The author of this piece in Forbes is covering similar ground, broadly applied across accounting and finance, which has accelerated as a result of pandemic related government and business policy consequences.
‘If companies were in a rush to implement digital transformation pre-Covid, they are now in a race. Based on their recent survey McKinsey reports “Covid has pushed companies over the technology tipping point,” with executives responding that their companies “have accelerated the digitization of their customer and supply-chain interactions and of their internal operations by three to four years.” That is what I call tech transformation in hyper-drive, the equivalent of light speed….CFOs must be ready.
Technology is a great tool to provide better leadership, strategy, performance, analytics, controls, reporting and operations management. But the tech revolution that is transforming business is not just about technology. It is about the humans behind the technology, and their ability to leverage these new and exciting tools in ways that add value to the business. This means a major upskilling initiative is underway in finance and accounting to understand the technologies and learn how they fit into processes like the financial close or forecasting. A recent IMA survey found most finance professionals (78%) were already planning on upskilling prior to the pandemic, but are now very concerned about maintaining and/or enhancing their skills for the post-pandemic world.’
The author goes on to discuss the types of technology that is required, which we have also covered in various reports, including our 2021 Outlook, and makes the point that financial professional need to quickly adapt to the new capabilities.
In other words, an upskill is needed, and of course we have seen this recognition at various levels, including trade events such as Sibos and AFP, etc. The old ways give way to the new, and should be welcome, since the FPs will have more tools to do their jobs better and in less time.
‘Though these technologies require new skills, for many in finance and accounting, the efficiencies they can bring are a welcome change. The “before hours” and “after hours” meetings, where different units reconcile financials to provide accurate numbers for management to report, can become a thing of the past, with the aid of blockchain technology. Advanced data technology can capture ever-increasing amounts and types of data, providing clearer pictures to CFOs about the state of the business. Smart contracts have eliminated the need for in-person handshakes as a sign of trust because every item in the contract can be validated digitally.’
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group
