Original content provided by BDO United Kingdom
Overview
Businesses are relying more heavily on their finance functions to make strategic decisions. During uncertainty, the expectations land on the finance team to speed up the recovery process and support with managing costs, maintaining profits, and mitigating risks. The demands on finance teams to create and sustain value are higher than ever. However, adverse events can reveal whether finance functions are reactive or proactive in responding to market changes. To create value while managing business as usual activities, finance teams must shift their focus towards becoming a reliable and trustworthy strategic partner.
Finance transformation - designing capabilities
In today's fast paced and dynamic business landscape, having access to a single source of truth is more critical than ever. Finance teams are rising to the transformation challenge because their purpose is changing and are harnessing the power of data, analytics and automation to provide business executives with accurate and reliable information. Enterprise leaders increasingly rely on finance teams to leverage information to help them enhance governance models, mitigate risks, strengthen internal controls, and gain access to data visualisation.
Financial data can only be reliable if it’s high quality and adequately controlled, only then can executives reliably gain deeper understanding and comfort over their decision making. This will lead to more intelligent practises resulting in an increase in the probability of implementing a successful strategy and which in turn will improve operational performance.
Those finance teams that combine data and risk management modelling create game changing business opportunities. Improving and maintaining internal controls that are proportionate to business activities provides executives with the comfort that they are being presented with a single source of truth and can make informed decisions with confidence and position their business for long-term success.
Going beyond addressing financial pressures
Whilst addressing immediate financial pressures is critical, it is just one of the strategic responses. Modelling various scenarios and identifying risks and opportunities can help businesses make more intelligent decisions that lead to growth and success. To achieve this, organisations must transform their finance operations by scaling up their data usage, improving internal controls, creating alignment, and managing systems and applications across multiple areas such as supply chain, sales, marketing, and procurement.
By effectively leveraging data and understanding the risks, finance teams become growth and innovation enablers that can drive and maintain a competitive advantage in today's quick moving business environment. Addressing immediate financial pressures is the first step towards a successful strategic response. To support business leaders in making better financial decisions, organisations must transform.
For further information, don't hesistate to contact our Advisory team: David Warnock, Pamela Gillies, and John Young.