The traditional office of finance has five main organs: accounting keeps the books; financial planning and analysis (FP&A) analyzes performance and manages the forward-looking activities of the company such as planning, budgeting and forecasting; corporate finance raises outside money; treasury takes care of the cash and bank accounts, and tax. The modern office of finance requires a sixth: Finance IT (FIT).
Topics: Office of Finance, Analytics, Financial Performance Management, Price and Revenue Management, Digital Technology, Operations & Supply Chain, ERP and Continuous Accounting, blockchain, robotic finance, Predictive Planning, Conversational Computing, AI and Machine Learning, revenue and lease accounting, collaborative computing, subscription management
A quarter century ago the “fast, clean close” became a key measure of a finance and accounting department’s effectiveness. Since then there has been general agreement that companies should be able to close their books within a business week. Our research on the accounting close has consistently shown that companies with very similar characteristics (measured in terms of revenue, number of employees, location and industry) vary considerably in the number of days it takes them to complete their accounting cycle. The lack of connection between the structural conditions of a corporation and the time it takes to close the books suggests that the obstacles to a faster close are not innate, but the result of poor process design and execution, insufficient automation of the process as well as choices made by finance executives. One of those choices is deciding — for whatever reason — not to close sooner.
Topics: Office of Finance, Financial Performance Management, ERP and Continuous Accounting, robotic finance
By itself, data isn’t useful for business; the application of analytics is necessary to transform data into actionable information. Data analysis of one sort or another has long been a core competence of finance departments, applied to balance sheets, income statements or cash flow statements. Today, however, Finance must go beyond these basics by expanding the scope of the data being examined to include all financial and operational information that can yield actionable insights. Analysis thus should include, for example, data from the systems that manage sales operations, human resources and field service and that data must be available to all departments and applications that need it.
Topics: Customer Experience, Human Capital Management, Marketing, Voice of the Customer, business intelligence, embedded analytics, Learning Management, Analytics, Collaboration, Data Governance, Data Lake, Data Preparation, Information Management, Internet of Things, Contact Center, Data, Product Information Management, Sales Performance Management, Workforce Management, Financial Performance Management, Price and Revenue Management, Digital Technology, Digital Marketing, Digital Commerce, ERP and Continuous Accounting, blockchain, natural language processing, robotic finance, Predictive Planning, candidate engagement, Intelligent CX, Conversational Computing, Continuous Payroll, AI and Machine Learning, revenue and lease accounting, collaborative computing, mobile computing, subscription management, agent management, extended reality
“Platform,” as used in the world of technology, originally referred to an operating system on which one could construct software applications. More recently, its usage has been expanded to apply to two types of business models. One enables third parties to create products and services that are complementary to a company’s core technology. For instance, both Apple and Salesforce have attracted a wide array of third-party software developers whose offerings greatly increase the value of each software vendor’s platform to its customers. The second, such as Amazon’s marketplace, Facebook, Twitter and Uber, facilitates transactions and interactions. This latter type adds value by reducing transaction frictions and increasing efficiency and, in attracting large numbers of people to the platform, enables innovative business offerings to take advantage of Metcalf’s law — the “network effect.”
Topics: Human Capital Management, Marketing, Office of Finance, Voice of the Customer, Continuous Planning, Information Management, Internet of Things, Workforce Management, Financial Performance Management, Price and Revenue Management, Digital Marketing, Digital Commerce, Operations & Supply Chain, Enterprise Resource Planning, ERP and Continuous Accounting, robotic finance, Predictive Planning, revenue and lease accounting, collaborative computing, continuous supply chain
Business planning in most companies is a relic, a process hemmed in by obsolete conceptions of what it can be. “Business planning” encompasses all of the forward-looking activities in which companies routinely engage, including marketing, sales, customer, supply chain and workforce planning as well as budgeting. In our view companies today can fundamentally change how they plan thanks to the maturation of information technology. Current systems can support better business planning as well as traditional budgeting. Dedicated software can increase the business value of the time spent planning and budgeting by enabling all parts of the business to share their plans. It can substantially cut the time spent creating and updating plans. And it can allow senior executives to see a consolidated view of the plan and quickly explore alternatives and contingencies.
Topics: Office of Finance, Financial Performance Management, Price and Revenue Management, ERP and Continuous Accounting, robotic finance, Predictive Planning, revenue and lease accounting
From my perspective there were two significant takeaways from this year’s SuiteWorld. The first is that, almost two years on from the announced acquisition of NetSuite by Oracle, the combination has achieved its immediate objectives in growing NetSuite’s business, especially in Europe and Asia, and accelerating product development efforts. The second takeaway is that, at least for now, the unit appears to continue to operate as if the combination were a private equity investment by a public company.
Topics: Office of Finance, Financial Performance Management, Enterprise Resource Planning, ERP and Continuous Accounting, robotic finance, Predictive Planning, revenue and lease accounting
SAP recently held a teleconference to highlight its blockchain strategy. Lately, the major business software vendors have been calling attention to their blockchain initiatives. While the focus on this technology might seem premature to those who still equate it with cryptocurrencies, evidence is pointing to a future pace of adoption similar to the rapid take-up of the internet in the 1990s. That blockchain is useful for a wide range of business functions isn’t news – just google “blockchain use cases.” Payment, provenance, testament and efficiency are four main themes driving a multitude of applications of the technology. That said, blockchain isn’t technology in search of a mission but is something more like the internet, both in its broad utility and in value multiplication through network effects.
Topics: Machine Learning, Office of Finance, finance transformation, Robotic Process Automation, Artificial intelligence, blockchain, AI, bots, robotic finance
Robots of the physical sort are not about to take over finance and accounting but we have arrived at the age of “Robotic Finance”. I coined this term to focus on four key technologies with transformative capabilities: artificial intelligence and machine learning, robotic process automation, bots and natural language processing and blockchain distributed ledger technology. Embracing these technologies will enable any department to redefine itself as a forward-looking strategic partner to the rest of the company.
Topics: Machine Learning, close, closing, Robotic Process Automation, Artificial intelligence, blockchain, AI, Accounting, bots, robotic finance
