A recent promotional piece from Deloitte describes how Operational Finance should be the epicenter of upheaval. But Deloitte’s experiences with companies around the world leads it to believe that most companies are “sleepwalking” into this future of inevitability – with nearly 50% of the time currently still being spent on data extraction and modelling, leaving precious little time to support decision-making and change management.
Deloitte’s cross- industry benchmarks indicate that more than 60% of the time spent within the entire Finance function is spent on operational Finance activities. Many of these activities are still manual, where the median performer:
- Processes 23% of accounts payable vendor invoices automatically
- Processes 59% of accounts receivable customer remittances automatically
- Has automated 19% of total key controls
Sound familiar? Deloitte says each organization should ask where it sits on the evolutionary spectrum. Today, the role of the CFO is under greater scrutiny, internally and externally, and faces never-ending pressure to cut costs, grow revenue and ensure control. Economic uncertainty, increased regulatory requirements, financial restatements and increased investor scrutiny have forced them into the spotlight. It’s not surprising that CFO turnover is on the rise.
Deloitte has advice:
- Establish the strategic direction to understand the strategic vision of the company overall and to identify the goals and aspirations for Finance.
- Understand the foundation to establish the as-is state of the business and benchmark against leading class, cross- industry organizations.
- Develop a vision for the role of Finance to prioritize the objectives and set high-level performance targets.
- Define the target operating model and identify the required change initiatives based on impact and effort assessments.
- Create a roadmap with high-level business cases and establish a change and communication management framework.
- Implement change initiatives, including making process improvements, rolling out enabling technologies, setting up robotics, and connecting monitoring tools.
At VersaPay we assist CFOs with many of these elements noted in Deloitte’s advice, specifically through automating the invoice-to-cash cycle. We are always interested to help.