Many CFOs and top business executives want to prioritize digital programs this year. However, a significant percentage of these executives claim that the COVID-19 pandemic has inspired their resolve for digital programs. The main challenge for CFOs is where to get funding for digitalization.
According to Alex Bant, Chief of Research, Finance, Gartner, CFOs have requested artificial intelligence (AI), robotics, machine learning, and advanced analytics. CFOs will turn their focus on enterprise and finance-function digitalization. The following are the four digitalization programs for CFOs in 2021.
1. Advanced Data Analytics Technologies and Tools in Finance
Analytics plays a crucial role in creating value in many businesses. However, the finance function is overwhelmed with data. As a result, CFOs will have to utilize the finance function to expand analytical capabilities, processes, and roles and help all stakeholders comprehend and manipulate financial data to make feasible choices.
Advanced data analytics in finance involves leveraging data across an organization, including operational, sales, and financial data, to provide information that will help highlight an organization's strategic priorities. This information allows controllers to get comprehensive insights and create programs relying on these insights for guidance. Advanced analytics in finance involves using user-friendly tools for a comprehensive analysis of key business variances and drivers. It also involves interactive self-service applications, enhanced cognitive insight, and forecast scenarios. Lastly, it also entails data automation. This helps provide cognitive insights, analysis, and commentaries based on datasets to predict and support business actions.
2. Robotic Process Automation (RPA) and Other Workflow Automation Technologies
Robotic process automation (RPA) is a technology that allows you to build, deploy, and control software robots that emulate the actions of humans interacting with digital systems. Like people, robots are made to understand what is on a screen, complete the right keystrokes, extract data, and perform various defined actions. However, software robots are faster and more consistent than people and don't need to take breaks. The use of RPA for finance teams delivers speed, cost optimization, and efficiency. However, CFOs also need to focus on additional technologies, including machine learning, artificial intelligence, and chatbots. These can cover complex, dynamic processes that require human judgment.
3. Accelerating Digital Skills
Developing digital skills is a priority for finance leaders in organizations. It also helps the finance function itself. As a result, there is a high need to increase awareness of digital technologies in the post-pandemic recovery. Firstly, finance leaders need to identify digital skills, especially those specific to employees' daily workflows.
A study by IBM established that about 120 million workers across the globe need to be retrained due to advancements in technologies, particularly artificial intelligence and automation. As technology evolves, many jobs become outdated, and this creates an unemployment crisis. The Digital skills gap is posing a great risk for many enterprises. Elevating the workforce’s digital skills is a priority in many industries and has been accelerated by the COVID pandemic.
4. Enterprisewide Digital Investment Review and Governance
The increasing diversity of investment projects considering digital acceleration has oriented investments outside the bounds of traditional capital budgeting methods. This is the reason why CFOs need to rethink the way they will measure, fund, and control digital business performance.