Enterprise Transformation Series | Part One | The CFOs Promoting Digital Finance Transformation
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As Deltek is a provider of innovative cloud-based solutions, our partner firms are among those in their industries already exhibiting visionary and ambitious behaviours and adopting the right 'future-state business models'.
However, that does not remove the element of uncertainty commonly attributed to the adoption of any new digital innovation. And many clients have articulated to us, that their initial transformation roadmaps have felt similar to placing a bet at the races. There is excitement, the organisation wants to bet on a winner, but, they have no guarantee it will be met with success.
Transformation should start from the core and be based on proven industry practice, rather than the peripherals of the organisation. Understanding the importance of this, and finding a strong partner who understands the industry, and knows how to implement, will give your firm a far greater chance at success.
Professional Services Trends Report 2018
Furthermore, with attention increasingly turning to competition, many of the C-Level executives we meet also question whether they are moving fast enough, and capitalising on technological change, given the risk to business. A recent Deltek survey of the sector found that only 19 percent of C-level leaders felt their firms will be digitally “mature” or “advanced” within five years.
Whilst we empathise, we also encourage a shift in perspective. Embracing technological change can be immensely helpful in letting go of the old, setting the bar high for talent, and creating a business model that keeps the firm competitive.
Whilst decisions vary greatly based on organisational goals, over the next few weeks we will lay out departmental initiatives used by some of our clients to help fuel the next wave of growth and profits. Starting with:
The CFOs who have promoted digital finance transformation via:
- Automation and outsourcing of activities and;
- Transparency, to improve governance and compliance, internally and to regulators
The CFOs Promoting: Outsourcing And Automation Of Activities
The finance departments of Professional Services firms have been increasingly taking on differing day to day responsibility whilst at the same time, having to promote long-term value creation and efficiency to support growing the top line.
According to some of our clients their departments are under strain to manage more transactions, greater project complexity with decreasing cost and staff base. There is also the continuous pressure on cost reduction and operating efficiency. And, whilst these responsibilities are easier to manage at a time of prosperity, they have not necessarily created organisational value during times of economic volatility or digital disruption.
Digital initiatives that we have commonly embraced with CFOs to fine-tune their finance divisions are optimisation models and automation, to compete in this challenging landscape. The automation of finance activities such as balance sheet reconciliations, to speed up processes, have resulted in a greater focus on project margin optimisation, and allowed teams to audit more efficiently.
SPI’s 2018 research underpins this sentiment, “Research demonstrates the powerful impact integrated business solutions can have on productivity and profit. It is remarkable that 33% of surveyed organizations still have not invested in Professional Service Automation”
Our clients see the huge horizon and impact that automation can provide, not only from a departmental perspective where it has allowed teams to concentrate on more value-add activities. One enterprise client states that far beyond the walls of the finance group, it has encouraged other divisions in the firm to become more innovative in this era of transformation.
'Our clients see the huge horizon and impact that automation can provide...far beyond the walls of the finance group, it has encouraged other divisions in the firm to become more innovative'
Another key consideration for CFOs has been the off-shoring, near-shoring or outsourcing of finance and operationally intensive processes. And, from experience, execution of this service model does have its own unique challenges in the Professional Service organisation and requires a strong understanding of processes with a technology partner in full support of the initiative.
Thanks in part to the international, multi-domain expertise of our employees, Deltek clients are able to see the long-term benefits of such service models. One multi-national Professional Services client has successfully off-shored finance resources to 3rd party suppliers to reduce costs. Another global innovation and engineering firm has near-shore IT in Europe. And, a 3rd, one of the largest global consulting engineering firms in the UK have a design centre in India. The possibilities are endless if firms can partner with experts who understand the industries unique challenges and priorities but also have an understanding of the world and markets in which their clients operate. Our own clients are reporting long-term reduced operating costs, and feel better placed to diversify risk, and focus on growth.
The CFOs Promoting: Transparency
From working with some of the biggest architecture and engineering firms in the world our advice to their CFOs has often ranged from automated dashboards for communicating KPIs, to developing data links between our ERP solution and external software. This is because technology plays an integral role for the CFO and their teams in providing a strong focus on cost control such as a ruthless attention of cash flow, backlog, forecasting and integrating information across business units.
'technology plays an integral role for the CFO and their teams in providing a strong focus on cost control'
Similarly, new regulation and new accounting standards, such as IFRS 16, and finance specific SOX requirements affect the bottom line. They put pressure on the operating model and returns. They also make data transparency critical. The boards of organisations as well as external regulators are wanting constant access to real-time visualisation, with one version of the truth.
Whilst we acknowledge that improving and reforming processes in finance with new digital technologies is complex, from experience, our CFO partners have turned transformation challenges into huge opportunities for precision and speed. And in terms of longevity they are managing to unlock channels to meet internal needs as well as growing client demand.
Digital Transformation Leadership Series:
- Digital Transformation And The CIO: Promoting Connectivity
- The Chief Operating Officers Focusing On Digital Talent Management & Closing Inefficiency Gaps
2018 Industry Report
Professional Services Trends Report
- Agency Workflow
- Architecture and Engineering Firms
- Business Intelligence
- Change Management
- Cloud ERP
- Consulting Firms
- Deltek Customers
- Financial Management
- Job Costing
- Legal Sector
- Marketing and PR Agencies
- People and Culture
- Professional Services Automation
- Professional Services Industry
- Project Management
- Resource Planning
- Scheduling And Planning
- Talent Management
- Time and Expenses
- Traffic Management
- Transformational Trends