Facing an unknowable period of continued disruption, finance leaders are playing a critical role in helping their companies chart their course forward. While the pandemic-driven recession will undoubtedly make spending reduction a focus, having real-time data and predictive insights to make smart choices about where to invest, where to cut, and how to enable necessary changes to drive growth will certainly help. To execute this, finance leaders will have to boost their analytics and modelling capabilities by leveraging new technologies and upskilling talent. Below are some of the key challenges facing finance leaders today.
1. Unifying disparate data
Bringing together disparate data remains a very real and prominent challenge for CFOs and finance departments in organisations today. Many businesses, especially those that have grown through merger and acquisition (M&A) activity, use various ERP systems and technology platforms. These disconnected systems require extensive manual rekeying of data and are one of the main reasons for issues associated with timely month-end close. Therefore, unifying disparate data is a very important task for the smooth functioning of the organisation and finance leaders can do this with the help of a single ERP system.
2. Improving financial agility
Fast-paced change is making predicting the financial needs of tomorrow increasingly difficult. It requires organisations to be capable of rapidly reassessing their priorities, redistributing funds and resources, and even making strategic pivots on a month-to-month basis.
This shift towards constant and rapid change means finance departments are under pressure to shift from traditional forecasting approaches and adopt more flexible rolling forecasts and scenario plans. This trend will drive greater integration of finance with the rest of the business through digital platforms. ERP contains forecasting capabilities that help CFOs identify opportunities early so they can direct operations to adapt quickly.
3. Modernising finance platforms
“A report by Accenture found that 99% of CFOs believe operating with real-time data is critical to navigating disruptions, such as Covid or the threat of a recession.”
Digitisation is the order of the day – and in many cases, that means replacing outdated legacy systems that stand in the way of flexibility and integration. The need for improved capabilities like up-to-the-minute data analytics based on real-time data is key to ensuring continued growth. ERP systems provide finance leaders with the insight they need to effectively manage their bottom line, make informed business decisions, and gain a better understanding of business operations.
4. Enabling global compliance
In a global environment, finance leaders are mainly concerned about maximising revenues and reducing costs. But compliance is an ever-present element that influences growth strategy, and the outcome.
High growth inevitably involves expansion, often through M&A, and with this comes critical local compliance factors. While a finance leader is looking to increase the efficiency of company operations and reduce costs, they must also be examining how this can be done while meeting all necessary rules and regulations. To successfully achieve this, a finance leader needs to have the right level of information; including the right information on the unique financial compliance requirements in every country in which they operate.
Some ERP systems, such as Sage X3 Finance, cater for multi-company, multi-legislation and multi-currency requirements in a single system helping finance leaders to have the peace of mind they need when operating under different jurisdictions.
The above challenges are just a few examples of the many issues faced by today’s finance leaders whilst they are working hard to support growth in their businesses.
Download our guide: A guide to the Sage X3 Finance module to find out how you can accurately control your bottom line and gain real-time global visibility and compliance.