Financial Digital Transformation, Explained

Written by Trovata Team
January 24, 2020

What is digital transformation and why is everyone talking about it?

The era of digital transformation is upon us.

You have probably heard this “buzzword” thrown around at industry events and among colleagues….but, what exactly does this mean and how does it pertain to the finance industry?

financial digital transformation

Let’s break it down:

The world is getting impatient. From next-day deliveries to instant website page loads, today’s humans expect instant gratification. From marketing to human resources, these expectations are also starting to creep up on finance departments. When it comes to patience, upper management wants access to real-time data — and they want it now.

Since finance jobs have not magically gotten easier through the years, there’s no “extra” time to devote to real-time stats. With all these increased expectations and limited resources, how exactly can finance folks deliver real-time insights AND continue succeeding in their ongoing, everyday tasks?

Truthfully, we know you are human and having access to real-time data based on manual calculations is nearly impossible.

Nobody expects you to be a computer…that’s where digital transformation comes in.

According to Salesforce, “Digital transformation is the process of using digital technologies to create new — or modify existing — business processes, culture, and customer experiences to meet changing business and market requirements. This reimagining of business in the digital age is digital transformation.”

In the world of finance, these processes can be something like calculating cash forecasting or having access to real-time cash visibility. These tasks usually require hours of daily manual calculations.

Thanks to new, emerging technologies, these tedious and manual calculations can be streamlined.

Research from the McKinsey Global Institute states that “40 percent of finance activities (for instance, cash disbursement, revenue management, and general accounting and operations) can be fully automated, and another 17 percent can be mostly automated. Those figures demonstrate the degree to which CFOs and other business leaders can simplify core internal transactions through automation, establish standardized reporting mechanisms, and work more efficiently.

Automating manual processes can save finance departments valuable resources and money. Instead of forcing talent to spend hours on manual calculations, finance professionals can better spend their time dissecting data to provide upper management with more strategic advice.

Moreover, having access to real-time data, such as bank data, opens up a world of opportunities for companies. From having easy access to real-time, actionable insights to having the power to feed this valuable data into other sources, such as an ERP system, can truly revolutionize the way finance teams run their workflows today.

Are you ready to take the first step towards digital transformation? Download, “A Strategic CFO’s Guide to Financial Digital Transformation.”

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