CFOs Transforming the Future of Finance

For many businesses, COVID brought forward plans to implement technology to transform their operations. This has allowed them to reap multiple rewards including improved efficiencies, reduced headcount and more robust processes. The challenge from here is ensuring the tech stack remains up to date into the future.

This was the subject of a recent CFO Magazine Lunchtime live event, which focused on the recently completed transformation journeys many of the panellists had undertaken.  Three Finance leaders shared their journeys during the event, with over 180 CFOs and finance leaders in attendance.

One of the panellists, from professional services business, McGrathNicol, recently undertook a significant technology project to replace the company’s ERP system with new digital tools, while moving most of the existing systems into the cloud. Some of the software McGrathNicol now uses includes SAP’s public cloud ERP, and SAP Concur for expense management and accounts payable, as well as some custom applications.

Head of Finance, Brendan Tanner says that while managing the implementations all at once was challenging, the move to the cloud has also produced many benefits. “It’s improved time sheet experiences, provided faster customer project initiations and flexible billing, as well as improved financial reporting. While regular system upgrades require management, they also introduce even more new functionality, such as embedded analytics tools, which has been great. SAP Concur also gave us the opportunity to re-engineer our accounts payable and expense processes.”

“Flexible working is the way forward and it’s all about being given tools that are going to enable your organisation to achieve the right balance depending on what’s happening in the market.”

Keith Payne | SAP Concur

Car company Honda New Zealand is another business that has undertaken a digital transformation journey during COVID.  CFO Joe Hall says the biggest challenge was access to information. “Everything was on paper, so it was really hard to get hold of data. Inefficient processes were another issue, as well as maintaining internal controls.” Implementing SAP Concur allowed the business to centralise processes for Honda’s 200 employees who are located across the country.

In terms of achieving a successful tech rollout, Hall says being able to get buy-in from the senior leadership team was crucial. The choice to start with Concur Expense made sense given it’s this group that mainly incurs expenses. The leadership team’s buy-in paved the way for SAP Concur’s invoicing tools to be introduced across the company.

During the pandemic, apparel business 2XU accelerated its strategy to restructure the business, starting with its cost base. “Cash preservation was my immediate focus through a 30 per cent reduction of the employee cost base, together with an enhanced focus and relentless rigour behind all costs,” said CFO Michael Caragounis.

Remote working catalyst

Commenting on the transformation trend, SAP Concur’s A/NZ Head of Sales for small and medium business, Keith Payne said the move to remote working made by many organisations during COVID accelerated the widespread shift to using technology to help staff do their jobs more effectively. “During this period, many businesses automated backend technologies to make it easier to engage employees, customers and suppliers.”

When it comes to deciding which technology to implement, Tanner says a priority must be the system’s ability to solve a business problem. “When we look to implement technology, it’s key to use a future lens and make sure the technology can be scaled up so extra capacity can be added in areas like planning and analysis.”

Through its transformation journey, Caragounis says a huge focus was restructuring the business, bedding down processes, setting up new performance benchmarks and instituting a cultural change program.

“We also took the opportunity to re-work our e-commerce channel, given the growth in online sales experienced through COVID. We invested in Shopify plus, which has been beneficial. The finance team’s focus now is to reanalyse systems as key enablers and we’re at that juncture at the moment.”

For Honda, Hall says making bold decisions about its approach to technology five years ago made the move into a working at home environment much easier. “The challenge now is to find the right balance as we get used to working with COVID, which is going to be with us for a long time. We need to understand the pressures our team faces working from home, their preference for flexible working and how to support them to look after their family. We need to balance that with the requirement to also get people together in an office environment to work on culture.”

As Payne noted, the commonality across many transformation projects is the opportunity for organisations to introduce flexible working in roles that would normally encompass repetitive or manual tasks.

“We have a huge skills shortage and one of the ways to resolve this is to support staff to work where, when and how they want. Organisations must give them the tools to enable them to do their jobs more effectively, while cutting out some of the manual tasks. The CFOs I talk to want to know about how they can support their internal customers and provide them with the tools they need to perform their roles more effectively and add value in other parts of the business.”

The skills shortage is presently occupying many CFOs’ minds, although there’s evidence the problem is not as acute as is often portrayed. Tanner notes salaries are rising and finding staff to fill contract roles that would in more normal times be filled by people on working visas is challenging given border closures. “But there hasn’t been a shortage of candidates when we’ve been out there looking for finance personnel.”

Overall, Payne says despite the unusual trading conditions, the past two years have been an opportunity for CFOs to rethink how the business is run to make improvements.

“Three components need to be balanced: people, technology and processes. The luxury we have at the moment is organisations can actually explore whether processes are people-centric or technology-centric. You need to be able to adapt technology when you’re stretched for people, and vice versa. Flexible working is the way forward and it’s all about being given tools that are going to enable your organisation to achieve the right balance depending on what’s happening in the market.”