Time to read: 3 minutes. The phrase “transforming the office of finance” comes up a great deal in marketing material aimed at finance professionals but it is unclear what it really means for the Finance Office. Discerning finance professionals could dismiss the phrase as just another meaningless buzzword that is thrown at the public in the digital age. “Transforming the office of finance,” however refers to a very real, actionable process that can bring new purpose and influence on the Finance Office and greater returns to the organization in general.
Multiple industries like sales, marketing, IT, data, and HR have all enjoyed domain-specific tools and resources. Sales and marketing have CRMs; IT has AI-driven tools; HR has payroll and people management systems; the office of finance has Excel. At Limelight, the phrase “transforming the office of finance,” refers to a process in which the office of finance can elevate itself from manual tasks like data entry to being a key decision-maker within the organization. The finance office can drive positive change by helping organizations transition to data-backed decision-making across the board, using the latest in FP&A processes to benefit everyone. Transforming the office of finance is roughly equivalent to XP&A, or Extended Planning & Analysis which refers to using the finance office to break down the barriers between departments and achieve company-wide planning. Financial Planning for areas that are not within the traditional realms of finance but could be.
Undergoing such a transformation is imperative to companies that are looking to both cut costs and increase efficiency rather than choosing between the two. Yes, it is possible to expend fewer resources on better insights and clearer data-backed insights. Unrest and uncertainty have increased the competitive nature of business and finance offices need to be prepared for a more disruptive future with the right tools and people in place.
Cloud FP&A solutions like Limelight are an integral part of achieving this transformation because of the way they build on traditional technology like Excel. Cloud FP&A is both easy to use and transformative in the way that it leverages the muscle memory of Excel but removes its underlying static and operationally burdensome nature.
1. Integrated and Centralized Data
Cloud FP&A solutions like Limelight offer direct integrations with an organization’s ERP software to standardize and store an organization’s entire financial data in one location with convenient access for all team members. This makes the finance team’s life considerably easier as it eliminates the headache of data silos and other forms of disparate data storage that extend the time spent on budgeting and planning. The finance team can become the finance data stewards for the whole organization without having to expend excessive amounts of time collecting data.
2. Collaborate with Other Departments
Storing data more easily makes standardizing data easier as well and enables the finance team to work more closely with other departments and apply finance style planning and strategy to the entire organization. A defining feature of XP&A and transforming the Office of Finance is the finance teams are emerging from the shadows and imparting wisdom and processes to other departments.
One area in which the application of planning and analysis can produce real benefits for an organization is labor planning, typically an organization’s largest expense. Cloud FP&A programs like Limelight have workforce planning features built-in to plan an organization’s labor expenditures more carefully. In today’s uncertain labor market, HR needs all the help it can get to avoid costly churn cycles.
3. Shift Focus to Value-Added Tasks
Limelight can refocus attention on value-added tasks in the finance department by automating the tedious tasks that consume time and resources while providing little in the form of returns. Finance teams can devote more of their time to FP&A, strategic planning, and working more closely with other departments to spread the benefits of planning and analysis around. This is how Cloud FP&A achieves the elusive balance of reducing costs while increasing efficiency, rather than sacrificing it.
Automation and artificial intelligence can help elevate the work of the finance team but are only one component of transforming the office of finance. Having the right personnel is still the most important aspect of transforming and improving the office of finance as technology is a tool to be welded by the right people directing it. The finance offices of the future will require finance professionals who are creative, analytical, and resilient to oversee the transformed finance office of tomorrow. It is also important to remember that if an organization does not transform its Finance Office, other organizations will.