In today's constantly changing world, winners will be enterprises that can seize opportunities and transform into modern, better-equipped businesses serving their customers without missing a beat. According to TCS’ COVID-19 survey most businesses were caught off guard when the pandemic began and only 25% were able to deliver end-to-end customer experience. Many organizations struggled with issues including teams not talking to each other, systems not working together, and data not being understood or used to glean meaningful insights. Modern cloud-based solutions integrating finance, sales, HR, and supply chains can reduce costs, boost performance, and deliver end-to-end customer experience.
There are three broad stages of transformation that cloud as the new ERPTM can bring about:
- Build a solid digital core to make your services sufficient, secure, and safe.
- Experiment and innovate new business models
- Participate in or be the anchor of a larger ecosystem of purpose-led organizations
Oracle role modeled the cloud transformation journey by moving its finance, HR, supply chain and other on-premise applications to cloud. It closes its books and reports earnings in less than 10 days, much faster than any other company of its size. Supply chain planning cycle improved from seven days to two days and reduced costs by 30% even while boosting performance.
In another instance, Zebra Technologies was able to customize its offerings while providing a streamlined commerce stack, which optimized the total cost of ownership thanks to TCS’ design and implementation of Oracle CX unified ecommerce platform.
There are several examples where enterprises have drastically expanded their boundaries, uncovered new revenue opportunities, grew their businesses and served a purpose to the society. One example of this is electric vehicle charging. Today, there are parking lots and utility companies provide the service of charging the vehicles and handle the payment services. It is imperative that the payment ecosystem from the customers to retailers to utilities must be handled in a seamless manner. This is an opportunity for a retail enterprise that has its asset as a cost center today to convert it into a revenue-generating one soon. When an enterprise harnesses all technology advancements to multiply its revenue opportunities, it becomes an intelligent, borderless composable enterprise.
From Resilience to Modernization: Finance Functions take the Plunge
In the immediate aftermath of the pandemic, as businesses shifted to a more borderless enterprise model intent on business continuity, digital transformation was no more an option but an imperative. Therefore, it made sense for finance functions to focus on their modernization plans and investments. Leveraging cloud for basic management reporting was an important part of this modernization plan for finance functions across industries.
With the power of technology, finance functions are becoming more strategic in nature, as they strive to improve their operational excellence and expedite decision making by gleaning insights from data. For instance, insurance organizations are moving their balance sheet management to the cloud as that enables them to fulfill long term promises to their customers.
Intelligent Automation and Cloud: A Winning Combination
Finance functions are bringing on intelligent automation onto their processes such as automatic reconciliation on cloud. Change management with the human workforce being the biggest challenge of intelligent automation, early adapters among employees are key to its success. When the intentions about intelligent automation are right, with appropriate storytelling, CFOs can convince their workforce to offload their mundane chores to robots and invest time in analyzing data for faster decision making. Changing mindset calls for persistent efforts from the leadership and is definitely not a short-term imperative.
Growth vs Cost Optimization: Balance for Success
Given the twin priorities of cost optimization and the growth strategy, finance functions must start with assessing the requirements of their enterprises. Often, data is the answer to managing these diverse imperatives. For instance, accounting is all about getting data right at a low cost. With the power of cloud and scalability of data repositories, data, be it for accounting needs or operational analytics, can be integrated into a seamless architecture. New applications alone are not the solution. Data and technology must be considered from the bottom up, which means a strategic data architecture, and then the application platforms should be embedded as the backbone to run the business. Finance function is an important part of an enterprise irrespective of the industry. With increasing focus on compliance and regulations, enterprises turn to their finance functions for data and therefore over time finance and risk will merge and become the epicenter of all data activities. Finance and risk data will emerge to be the source of data that all other departments will feed from and not just the ones that others try to reconcile with. Good quality of data is the cornerstone of enterprise growth driven by financial intelligence. Understanding the cost structure from a customer and a process perspective is critical to the digital transformation of the finance function and enterprise growth.
Reaping the Returns: Holistic Benefits is the Way Forward
Figuring out the return on investments for financial transformation in terms of monetary value can be quite easy. Enterprises need to ensure their baselines are correct and include the cost of benefits such as modernizing legacy systems and the softer benefits of improved employee productivity. It is also important to understand the disruptive effect of cloud technology on some of the traditional support models for IT and the way that financials unfold over the years.
Finance functions on their digital transformation journey should be careful of not losing sight of their organizational imperatives in the myriad of technological possibilities available to them. A disciplined approach to building capabilities that can move the needle for their business is important. While leveraging data analytics in finance for accelerating decisions, it is also important to anticipate surprises, which may not be possible to foresee from the data currently available.
To action your financial transformation vision, please reach out to EAS.Marketing@tcs.com