The finance department in any organization has an interesting position. While it's one of the most vital parts of a company, there are often lots of misconceptions about what the team does and why it's important.
Traditionally, finance teams have focused on controlling internal and external financial streams. For example, managing incoming revenue, or setting company budgets and making sure that these are respected by all employees. But business is always changing, and with it the different things companies require their employees to do.
Thanks to technological innovation, CFOs and their teams are getting the opportunity to reshape their field. By using tech to their advantage, they will be able to do their work better and more efficiently, while simultaneously evolving their responsibilities.
In this article, we'll take a look at the various ways the financial function is changing and the best ways for the sector to embrace this change.
Gone are the days of teams that are solely focused on one thing: ensuring that financial problems don't come in the way of a smoothly running company. Modern finance teams have the responsibility to make much more impact.
It all starts with the realization that finances are at the core of every modern commercial organization. Regardless of the type of company, money comes in and money goes out, sustaining the continued existence of the business. This gives the CFO and their team a unique perspective — having insight into these financial flows makes it possible to extract actionable insights that can be used to power smart decision-making.
By performing a thorough analysis on financial data, the underlying workings of a company can be uncovered, which gives finance teams the power to come up with strategic adjustments. These observations could be of immense value to the executive board, eventually even powering critical decisions that could lead to growth.
The modern CFO and their team is not just someone who watches over the assets of an organization, they are also key strategists that shape the company's direction.
Even though part of the finance position is transforming, there are also more traditional elements that are staying the same. Risk management is a classic example of something every finance department has to deal with, and something which could profit immensely from integration with tech.
One way to approach risk management in the digital age is by using an artificial neural network. This new technology is a way to use machine learning by training a system to consider various situations and learn from its own activity. When mitigating risk chances, there are thousands of scenarios that should be taken into account. For this reason it's a task that would much better fit the fast processing of a computer than fallible humans, which makes it a valuable asset for finance teams.
When you could to do more work faster, with less mistakes and a higher success rate, there's no reason you shouldn't. Executives are always looking for ways to spend less money running the company while improving the productivity of its employees. Many improvements have been made over the last few decades, of which one has easily made the most impact — forcing workers to do their work on a computer.
While the computerisation of work has made businesses more efficient, many companies still aren't making the most out of everything technology can offer. Using the right tools is important, and it's often overlooked — just think about how often office computers are locked to using a prehistoric version of Internet Explorer or Microsoft Office.
There are terrific tools for all kinds of things — Xpenditure for expense management or TransferWise for the best way to send money internationally without having to pay hefty fees. These are just a few — I won't list them all — but a great way to keep up with the latest tools is by regularly checking out Product Hunt.
For CFOs, innovation can't come as an afterthought anymore — it has to be a fundamental part of the team, tightly integrated from the start. Embrace this as a team, and the sky’s the limit.