A recent survey of 500 finance leaders found that 82% of their finance departments are currently using AI or plan to in 2025. Sixty-four percent of the leaders reported using finance automation technology. And seventy-six percent view the continued adoption of cloud solutions as important.
In other words: Technology is seen as critical to finance success. And to harness its power within your team, you must undergo finance transformation, the equivalent of digital transformation for your financial processes.
The word "transformation" is known to cause fear, especially for organizations that still rely on manual processes and legacy systems. However, finance transformation comes with a wealth of benefits that could help you move faster toward your organizational goals. And we have proof.
Here, we'll share with you finance transformation examples from companies that have overhauled their financial processes and reaped the benefits.
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Key Takeaways:
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Table of Contents:
- Financial Transformation Basics
- Process Automation in Finance
- Accelerating Financial Close Cycles
- Global Process Alignment and Cost Reduction
- Enhancing Operational Efficiency with a Human-Centered Approach
- How to Apply These Strategies to Your Organization
Financial Transformation Basics
Financial transformation means improving your organization's financial processes and systems to boost efficiency and meet strategic business goals. It typically involves implementing technology such as automation or software.
Why does financial transformation matter? It:
- Helps you adapt to technological change: The first website was created in 1991, just a bit over 30 years ago. And now, we're using artificial intelligence (AI) daily. Technology evolves fast. To remain competitive, you must move with it. Financial transformation enables you to do just that by taking advantage of technological advancements such as automation and data analytics.
- Improves decision-making: A critical component of finance transformation is often harnessing the power of real-time data through analytics and software tools. Using real-time data, you can make in-the-moment, educated financial decisions that keep you on track toward your goals.
- Increases efficiency while reducing costs: Technology tools and automation eliminate manual tasks that bog down your finance team's time, increasing efficiency. Finance transformation can also reduce costs by eliminating redundant financial processes.
- Simplifies collaboration across teams: Real-time data access, finance software as a single source of truth, and other technological advancements simplify team collaboration. This breaks down silos, enabling all critical players to move together towards business goals.
While transformation takes effort and investment, many companies, from global professional services companies to pharmaceutical companies, have seen notable success. Let's take a look at four unique finance transformation examples that highlight some of the wins you could experience too.
Process Automation in Finance
Process automation means using technology such as software to automate repetitive and manual tasks within finance processes. Accenture utilized process automation to transform its finance strategy.
Company Example: Accenture
Transformation Overview
Accenture is a global professional services company that supports businesses, governments, and other organizations in optimizing their operations and building their digital core. To create more value for their business, clients, and shareholders, Accenture reinvented their finance policies and processes.
Focusing on process automation and advanced analytics, Accenture implemented a unified global finance system. This unified system means that every finance team within Accenture, across the globe, now uses the same data, the same system, and the same processes.
Details
Accenture started by investing in automation to eliminate manual tasks. Process automation paved the way for other technologies, including machine learning and predictive AI, to boost transaction accuracy and uncover critical insights for educated decision-making.
Process automation also enabled Accenture to standardize its financial processes and metrics across global teams, resulting in consistent reporting.
Outcome
Process automation gave finance teams more time for higher-value tasks by eliminating tedious manual tasks. Machine learning and predictive analytics increased transaction accuracy, provided deeper insights, improved advisory support for clients, and reduced overall cycle time.
Accenture's dedication to finance transformation is enabling the company to meet its goals while keeping up with tomorrow's finance and technology demands.
Key Takeaway
Process automation can save your finance team time by reducing manual tasks. However, it can also lead to the use of other tech tools like machine learning that can enhance decision-making, improve collaboration, simplify reporting, and improve accuracy through the use of data.
Accelerating Financial Close Cycles
Shortening the financial close cycle is a common goal for many finance teams. A faster close has many benefits, from reducing costs to achieving financial insights quicker. Takeda, a pharmaceutical company, reduced its close by nearly two weeks through finance transformation.
Company Example: Takeda Pharmaceutical Company
Transformation Overview
Takeda is a global biopharmaceutical company headquartered in Japan. In 2019, Takeda started toward its goal of becoming a "best-in-class finance organization." To do that, the company worked with EY to transform its finance strategy and processes.
The three-year engagement, named "Project Quantum" began in early 2020. Over the next three years, Takeda would work with EY to perform an end-to-end transformation of Takeda's financial close process, resulting in a faster close and improved user experience.
Details
First, Takeda and EY focused on standardizing close procedures across finance departments. This step included setting up daily meetings to improve collaboration and a harmonized month-end close calendar. These initiatives began increasing the speed of the closing process.
Takeda also implemented a "right-first-time" metric for financial reporting, ensuring teams were focused on accuracy. This metric improved the number of accurate submissions, reducing rework time.
Another initiative, the development of a digital accrual solution, automated monthly postings while capturing critical data from purchase orders. This enhanced the user experience while improving the quality of financial data.
Outcome
Takeda saw much success from their efforts. For example, after developing the digital accrual solution, finance teams saved 100k+ hours in review, freeing teams up to focus on other higher-value tasks.
Through their initiatives, Takeda has reduced their financial close process by a whopping nine workdays, enabling faster insights and decision-making across the organization.
Key Takeaway
The faster the close, the faster you can unlock accurate financial data to make informed decisions and boost your strategic financial planning. For Takeda, accelerating the financial close cycle was only made possible by transforming their financial processes using technology.
Global Process Alignment and Cost Reduction
Global process alignment is critical for multinational corporations as it standardizes business processes, helping them operate consistently across all regions. And one of the key benefits? Reducing costs. This was the experience had by one multinational industrial company that completed a finance transformation.
Company Example: Anonymous Industrial Company
Transformation Overview
This industrial company had grown over time through many acquisitions. Unfortunately, this led to increasing complexity due to hundreds of different ERP instances, unintegrated finance strategies, and a lack of standardized processes. This also meant that certain financial processes were being performed in high-cost locations, leading to increased overhead.
The company partnered with PwC to align its global finance processes using digital platforms like SAP and Oracle Cloud as well as technologies like robotic process automation (RPA).
Details
The first step was to simplify the company's complex financial processes. This was done in many ways, from changing the organizational structure to implementing a shared services model across 16 finance teams.
During the transformation, the company established a standard chart of accounts, allowing all business units to use the same language for each transaction. In addition, they simplified and aligned their close process through automation.
Outcome
By aligning the company's global finance processes and leveraging technology, they've reduced their finance spending by 30% and shortened their close cycle by 25%.
The cost savings will enable the company to integrate new entities faster, so they can reach their growth goals. Plus, they'll experience a greater time to value in all of their M&A activities.
Key Takeaway
Whether you're a national or multinational company, centralizing and automating your finance operations can lead to significant cost and time savings. And those savings can help you achieve your goals faster.
Enhancing Operational Efficiency with a Human-Centered Approach
Those who move your organization forward, your employees, are an invaluable source of knowledge when improving financial processes. BP, with the support of Accenture, was able to enhance its operational efficiency by listening to the needs of its employees.
Company Example: BP
Transformation Overview
BP is a multinational oil and gas company with a vision of becoming "the leading downstream operator by 2025." BP knew that such a large goal couldn't be obtained without transforming its finance operations.
Starting within the company's Australia-based lighthouse program, BP worked with Accenture to develop user-centric processes through technologies such as Agile DevOps, extended reality, and AI. It was the company's hope to then scale those processes to other sites around the globe.
Details
BP and Accenture's work began by focusing on the human aspect of finance transformation by fostering employee engagement. They held workshops to understand the needs of front-line workers by gathering feedback and observing their ways of working.
This helped the company uncover two distinct process improvement products: Mobile-Enabled Field Worker and Wearables for Inspections. These products helped workers boost their mobility in the field while increasing the efficiency of inspections.
Outcome
These two products improved operational efficiency and continue to foster a culture of continuous improvement within the company. They also resulted in increased safety for workers as well as organizational cost savings due to increased productivity.
Key Takeaway
Addressing the needs of the humans that push work forward is critical for successful finance transformation. By identifying worker needs first, BP initiated a successful digital transformation that resulted in lasting benefits.
Plus, the initiatives can be scaled across the company, improving efficiency and reducing costs throughout the organization.
How to Apply These Strategies to Your Organization
These finance transformation examples are a solid playbook to follow to jumpstart your own transformation. Use the following best practices to apply these strategies within your own organization.
- Evaluate needs: The first step in any transformation is identifying your key pain points and needs. For example, the industrial company discovered that their number of ERP instances was causing widespread complexity and confusion.
- Choose the right tools: After identifying your pain points, you'll want to begin the process of researching the right tools to alleviate them. For example, Accenture used automation and machine learning to increase accuracy, improve advisory support, and reduce cycle time.
- Engage employees: By engaging with your employees, you'll identify additional pain points and potential solutions, just like BP. Engaging in this way can also ensure team buy-in and boost success rates through ongoing communication and training.
- Monitor progress: As you implement tools and meet milestones, you'll want to regularly measure and adapt your strategies for ongoing improvement. Choose and stick to KPIs, like Takeda's "right-first-time" metric to monitor success.
Realize Finance Transformation with 8020 Consulting
These finance transformation examples prove the benefits of improving your financial systems and processes. However, it's a complex process that requires the right tech tools and know-how.
The financial systems consultants at 8020 Consulting can help you choose the right tools and ensure you reach your goals. From performing in-depth readiness assessments to implementing cloud-based or on-premise financial systems, we're here to empower you to achieve transformation success. Connect with an expert today.
