Digital transformation has quickly become a hot topic for companies across the board. With a need to stay relevant and agile for the future, many businesses are looking to digital tools as ventures for long-term success. Per Gartner’s Leadership Vision for CFOs Report, 65% of executives reported having an increased focus and investment in digital business.
To maximize the success rates of digital investments, it is in the best interest of CFOs to learn how to identify and overcome the challenges of these initiatives. Gartner named 3 specific digital challenges for CFOs: improving returns from digital investments, digitizing the finance function, and unlocking the value of advanced analytics.
The Top 3 Digital Challenges for CFOs
Challenge 1: Improving returns from digital investments
The best way CFOs can increase returns on their digital initiatives is by choosing the right vendor and software from the beginning. This process entails selecting a solution with the right standards of success to solve a specific business problem. A solid digital investment will include guaranteed ROI, the elimination of wasted spending, enhanced data accuracy, and increased process visibility.
CFOs can drive value by hyperautomating their finance processes with technology like artificial intelligence and machine learning. Hyperautomation is a proactive approach that tackles the digital conservatism many lagging finance teams have. By automating time-consuming and convoluted tasks, hyperautomation boosts employee productivity and eliminates costly errors or inconsistencies. For example, accounting teams can leverage real-time accounts payable automation to offload the strain of manually processing high volumes of invoices. This decrease in manual work allows them to add more strategic value to their role and organization.
Challenge 2: Digitizing the finance function
A major issue CFOs encounter when digitizing business is that many finance functions lack the digital competencies to fully leverage technology and automation. When finance professionals have limited digital skills, this can interrupt the deployment of a new tool and result in an unsuccessful implementation process. CFOs looking to execute a successful and longstanding digital transformation must elevate the digital skills of their teams. To do so, finance leaders should worry less about anticipating future needs and work to improve current deficiencies. According to Gartner, the top three skills of a competitive finance team include being able to use automation to eliminate manual tasks, comprehending the nuances of cloud application management, and data literacy.
There are two ways CFOs can approach the upskilling of their teams. The first is being up-to-date on finance trends and continuously introducing relevant skills that allow finance staff to perform their roles more efficiently. The second approach calls for leaders to review their prioritization of skills and only prioritize new skills if they address immediate needs.
Challenge #3: Unlocking the value of advanced analytics
Trends are suggesting that the finance function’s role in the planning and strategizing of key business cases will only get stronger in the future. The value of analytics is powerful with insights from pilot projects and partnering with data teams, finance leaders can get a deeper awareness of their operations. CFOs can start by communicating with other top executives to find a specific business problem that their financial data can help simplify. From there, the CFO can strategically scale their data-driven projects to create more cross-functional impact. When CFOs follow this approach to providing actionable insights, their organizations can capture 10x return on investment, as stated by Accenture.
A successful digital business transformation helps secure the future of organizations, and with the right strategies in place, CFOs can overcome any challenges they may face along the way. By working to improve their digital competencies and unlocking the value of analytics, finance leaders can be well on their way to ensuring the success of their digital future.