As a CFO, you’re constantly under pressure to optimize financial operations. Balancing efficiency, accuracy, and strategic insights is crucial for driving growth and profitability. Due to this, CFOs are increasingly investing in analytic tools to drive digital transformation. In fact, 46% of CFOs surveyed by PwC are prioritizing technology implementation right now.
Choosing the right CFO software can be challenging as every provider promises to revolutionize your financial toolkit, offering a plethora of solutions for streamlining processes, automating tasks, and unlocking deeper financial data analysis. However, it’s important to ensure you approve a system that has measurable impact and drives ROI.
In this article, we’ll explore key considerations to be aware of before approving the purchase and implementation of a new system. The first step to properly assessing if a new system is the right fit, is understanding the common challenges your team faces.
Uncover Pain Points for You and Your Team
Before diving headfirst into approving the implementation of a new platform, consider your current landscape. The key to a successful implementation hinges on understanding if it addresses your team’s specific pain points. Here’s why:
- Targeted Solutions, Tangible Results: Platforms offer a plethora of features, but not all functionalities will be equally relevant to your team. By pinpointing the exact areas where your team struggles, you can identify features that directly address those bottlenecks. This ensures you approve the right software that has a tangible impact on your team’s efficiency and drives measurable improvements.
- Focus on Automation, Not Distraction: If your team spends a significant amount of time wrestling with manual data entry, reconciling accounts, or generating reports, automation is likely a top priority. Understanding your team’s manual processes allows you to prioritize features that streamline these tasks and free up valuable time for higher-level financial analysis.
With a clear understanding of your team’s manual processes, you’ll be well-equipped to ensure you’re approving the right solution. Focus on platforms with features that directly address your team’s identified pain points. This ensures your investment more quickly translates to a strong ROI, which is a common challenge for CFOs in terms of tech investment.
Core Considerations for CFO Software Success
Though CFOs are prioritizing tech implementation, many CFOs aren’t seeing ROI as fast they’d like. Data from both PwC and the American Institute of Certified Public Accountants suggest that these digital transformations aren’t yet translating to major ROI, at least in the early stages of investment.
That’s why it’s important to identify systems that can have both immediate and long-term impact. To that end, it’s important for CFOs to ask the right questions before approval. A key area is understanding how the system addresses core functionalities that empower your finance and treasury team.
1. What is the Timeline for Implementation and Onboarding?
As a CFO, you know the value of efficiency. In the aforementioned CFO surveys, we found that CFOs are seeing ROI fast enough. A major contributor to this challenge is a lengthy and costly implementation process for many legacy fintech platforms. In order to faster ROI, here’s what to look for:
- Minimal IT Involvement: Prioritize platforms that require little to no IT support for implementation. This allows your finance team to take ownership of the implementation process, along with vendor support, resulting in faster ROI. API-based platforms typically make implementation much easier as they can connect to your banks more quickly and integrate with other systems. Approve a platform that can be up and running in weeks, not months. This will result in seeing ROI more quickly with limited reliance on internal resources.
- Onboarding and Training: Evaluate the vendor’s onboarding process and training offerings. Look for comprehensive programs that include initial setup guidance, user training, and ongoing educational resources. Robust training empowers your team to utilize the TMS effectively from day one, maximizing the return on investment. Consider the format of training (e.g., in-person, online modules, video tutorials) to ensure it aligns with your team’s learning preferences.
- Ongoing Support: Assess the vendor’s ongoing support options. Look for multiple channels for assistance, such as a dedicated helpdesk, online knowledge base, and live chat functionality. Responsive and knowledgeable support staff are crucial for resolving issues quickly and minimizing downtime.
2. Does the Platform Connect to our Banks?
This seemingly simple question holds immense significance for CFOs before greenlighting a new system. In today’s dynamic financial landscape, ensuring seamless and reliable bank connectivity is crucial for real-time data access and efficient financial operations.
API-first Integration
Ideally, you should approve a platform that prioritizes API (Application Programming Interface) integration for bank connectivity. APIs act as intermediaries, allowing the platform to securely communicate with your banks’ systems and automatically pull the latest transaction data. This approach offers numerous advantages:
- Real-time data access: Eliminate delays and manual data entry by receiving the most up-to-date information directly from your banks.
- Enhanced accuracy: API integrations minimize the risk of errors that can occur during manual data entry.
- Streamlined workflows: Automate data retrieval and processing, freeing your team to focus on higher-value activities.
- Scalability and flexibility: API-based connections are easily adaptable to integrate with new bank accounts or financial institutions you might add in the future.
File Transfer Compatibility
While API integration is the gold standard for modern data management, not all banks offer APIs yet.
- sFTP and older file formats: Some banks still rely on file-based data transfer methods. Your goal should be to make data aggregation more efficient for your team by approving a platform that is able to handle these file transfers as well.
- Automated standardization is key: Even when dealing with file transfers, ensure the platform is capable of standardizing data. Cutting-edge technology that standardizes data across bank connection methods will dramatically improve productivity. This frees your team to spend more time on data analysis rather than collecting and normalizing data.
By asking this question with a nuanced understanding of the different connectivity options, CFOs can make informed decisions. Look for a platform that offers a future-proof, API-first approach while also acknowledging the realities of the current financial ecosystem and the need for file transfer compatibility based on your unique bank mix.
3. How Frequently are Various Data Points Updated?
The frequency of data updates (transactions and balances) can vary depending on the bank and the specific data point. Consider what data points are available through the API. Not all APIs offer the same level of functionality. It’s important to understand what data points are available through the API to ensure it meets your specific reporting and analytics requirements.
Ensure APIs are Being Fully Utilized by the Vendor
While many tech providers currently offer API connectivity, be wary of those that simply convert API data into legacy file formats. There are two important notes to keep in mind about how bank data is delivered via traditional file-based methods vs API connectivity:
- Bank data via files are limited and only contain specific data points relevant to a particular task. They may not encapsulate all the information a bank may have. As this is the simple, traditional method of connectivity they are well suited for older software (legacy treasury systems) that can’t intake complex data structures.
- Leveraging APIs unlocks real-time access to a richer set of bank data. This expanded data allows for in-depth, customizable analysis tailored to your specific needs. For example, more detailed transaction descriptions free from character limitations, enables you to specifically categorize them for comprehensive reporting. Additionally, APIs seamlessly integrate with cloud-native platforms, fostering a smooth flow of data across your systems.
This is why it’s important to ask tech vendors that offer APIs how bank data is integrated into their platforms. In many cases where legacy systems connect with banks via APIs, the bank data must be converted to a known file type before being fed into the system.
Due to these older platforms being unable to understand complex data structures, the remaining data is discarded. This hinders your data analysis capabilities and means you’re not truly reaping the full benefits of API connectivity. Additionally, look for vendors that manage your connections for you and offer self-healing functionalities to ensure smooth data flow.
4. Does the Platform Integrate With Your Existing Tech Stack?
Historically, each team within finance has had its own technology ecosystem. But modern tech enables a cross-process view through integrations. This means it’s important to review your current tech stack, and identify if the platform has integrations with your existing systems.
Before welcoming a new system, you need to understand its integration capabilities. A smooth connection between your existing tech stack and a new addition is crucial. For example if you’re implementing a new treasury platform you should ensure it integrates with your ERP to ensure smooth data flow. This eliminates manual data entry, improves data accuracy across your financial records, and boosts overall efficiency.
To assess integration capabilities, take stock of your existing software and research the new system’s pre-built integrations with popular financial tools. Additionally, if your team requires custom integrations, inquire if the vendor provides resources to facilitate this. By prioritizing integration, you ensure a unified financial ecosystem that empowers your business with real-time insights.
5. What Infrastructure is in Place for the Platform to Adapt to Future Growth?
Your organization is a dynamic entity. It constantly evolves through acquisitions, expansions, or even product pivots. The platform you choose shouldn’t be a rigid roadblock to growth.
Cloud-native, API-first platforms offer superior scalability compared to traditional, on-premise software and cloud-based systems.
Cloud-native vs Cloud-based: Know the Difference
Cloud-native solutions are built from the ground up to leverage the power and flexibility of cloud computing. For your needs, this translates to a platform that can easily adapt to new bank accounts, entities, or business ventures.
When a new subsidiary is acquired, for instance, a cloud-native platform can quickly integrate the subsidiary’s financial data. This allows you and your team to factor the new entity into forecasting and scenario planning more quickly.
6. What are the Platform’s AI Applications?
AI is a frequently mentioned buzzword in finance, but its practical applications within a platform might be unclear. In order to create efficiencies that have a beneficial impact on your team’s performance, you need to understand how the platform automates processes for your team.
Advanced Analytics and Forecasting: AI is a powerful tool to automate data analysis. These tools empower your team to delve deeper into your financial data, identify trends, and uncover hidden patterns. You can create future scenarios, assess risks associated with different strategic decisions, and make data-driven choices that support long-term growth.
Data Governance: AI-powered systems intelligently and automatically classify and tag vast amounts of data based on predefined rules or learned patterns. This automation reduces the manual effort required to organize that data, freeing up valuable time for your team to focus on strategic analysis.
By carefully considering core functionalities, avoiding common pitfalls, and optimizing your investment, you can unlock the transformative potential of this technology. Carefully evaluate your specific needs and choose a platform that demonstrably addresses your core financial challenges. With the right approach, technology can empower your finance team to become a strategic driver of growth, propelling your business towards a future of financial agility and informed decision-making.
Trovata: Next-Gen Treasury Tech for CFOs
If you’re seeking a new solution for cash management, Trovata offers a unique combination of features designed to address the specific concerns raised earlier.
Our cloud-native, API first solution provides a real-time, 100% accurate view of your entire financial position, in one place. In addition to enhanced visibility and forecasting capabilities, treasury teams are also able to transact within the very same platform, with APIs providing not just read-only access but the ability to generate payments as well.
Trovata offers treasury and finance teams an all-in-one solution that improves efficiency, reduces risk and enables strategic decision-making.
- Time Savings: Trovata’s focus on automation and streamlined workflows minimizes operational expenses, delivering a strong ROI.
- Quick and Easy Implementation: With Trovata, you can get connected with your banks in weeks, not months. The best part? No IT support required.
- Managed Bank Connectivity: Once connected, Trovata proactively maintains all your bank connections. We monitor for any changes or disruptions and address them swiftly, ensuring an uninterrupted flow of financial data.
- Seamless Integration: Trovata’s APIs allow for seamless integration with external platforms. Integrate with your ERP to streamline the flow of bank data. Additionally, Trovata integrates with Morgan Money’s trading platform allowing you to manage investments directly in the platform.
- Robust Security: Trovata is SOC-1 and SOC-2 certified, which means that we maintain a high level of information security and are a trusted solution for managing financial data.
If you’d like to see how Trovata can level up your treasury team, book a demo today.
