The changing world requires new ways of working: smarter, faster and smarter. Nothing is more important than the world of finance. With the amount of data and increasingly powerful artificial intelligence, machine learning and analytical skills, you can transform financial organizations and make smarter business decisions.
In this blog post, we provide a brief guide to the changing needs of the financial function, what you need to know about financial management systems, and how the right system can help companies adapt to the changing world and find of new business opportunities.
Table of Contents
Why is a modern financial management system important to an organization?
Financing enhances corporate success and finance teams increasingly need to take initiatives to empower companies to make better decisions by analyzing data that provides insight to all actors. Action – Provides information about the strategy and context for the real impact of the decision.
This, according to Workday, requires two things: easy access to current economic and employment data and the ability to combine disparate data sources for multidimensional reporting and analysis. Non-financial data, especially information from operating systems, provide a broader context and a more complete picture of performance factors. These skills enable organizations to make decisions and plan more effectively.
How does technology impact a financial system or process?
Basic financial systems start with what you don’t see: basic transaction processing, reporting, and analytics technologies, preferably in one place, so your customers can plan, trade, analyze, and report data. financial team without leaving the system. A cloud-based financial management system makes all this possible.
Keep the following in mind: Automated business processes are integrated into the system, and you can quickly create new processes or adapt delivered processes to adapt to industry or regulatory changes. Data protection, functionality, processing, and applications should be adequate to facilitate access and change management.
Integrate functions and analytics into one system that stores all data in memory so you can process, integrate, and report events in real time. When an accounting transaction occurs, it is immediately available for reporting and analysis in the same system. Finance can produce daily consolidated reports for different entities and currencies as needed, significantly shortening accounting closing hours. For example, under the unified system, City Year will accelerate the number of monthly and quarterly closures by 40 percent, and the EPA in Northern California, Nevada, and Utah will reduce quarterly closures from 10 to five days.
In other words, in today’s changing world, financial management is:
- Provide a complete, accurate, and real-time picture of your business.
- Equip your leaders with relevant, contextual business insights.
- Enable you to embrace organizational, process, and reporting changes without business disruption.
What specific challenges do finance teams face today?
Funding must provide information beyond the data in the general registry to build legacy systems. Because there is a wider range of actors and the business environment is constantly changing, funding is needed to provide the company with perspectives that can actively influence the decision.
Many finance teams struggle to perform this task. They are still engaged in traditional operational tasks and spend most of their time collecting data, rather than analyzing it and becoming the strategic partner their organization really has. Fragmented or old economic systems make it difficult or impossible to get the information you need when you need it. Information that is important to many organizations is left behind in old systems – or even spreadsheets – and falls within the organization. Organizations do not have access to this data and can easily integrate it with external data sources to create data models and predict the future of organizations.
Funders worldwide are exposed to heightened risks due to the speed of technological change, the impact of digital disruptions, increasing regulatory oversight, data protection and cybersecurity issues, economic uncertainty and financial market instability. Finance teams need to act faster and leverage real-time data across the organization to better manage risk in a changing world.
How do traditional financial management systems work?
Older solutions were designed to automate and simplify accounting to support financial reporting. This process is traditionally inflexible and linear, from registration of transactions in the primary registry to registration in the general registry. If transactions occur in the course of accounting, the financial data will be deleted so that the items in the financial statement can update the financial balances. Systems made in this way can only support accounts based on the identification of the initial implementation of the accounting segments.
In addition to these systems, organizations need business or data storage, business analytics solutions, and reporting tools to provide a broader perspective on business reporting and management. . This “loaded” approach means creating and maintaining costly integration that requires more data alignment and causes unnecessary errors for businesses. And this solution will eventually lead to stuck disconnected data storage.
Various accounting, consolidation, compliance, purchasing, revenue, compliance and other features make your financial management environment more complex. Fragmented systems make it difficult to deliver real-time business information and keep pace with growth and change. Scaling or modifying these systems to meet the needs of a growing and evolving business is slow, costly, and in some cases nearly impossible.