The use of technology in financial management is nothing new. More than ever, this strategy has been essential in providing relevant information that contributes to more assertive strategic decision-making and, consequently, to the success of organizations.
Therefore, the research data is not surprising. Gartner CFO Survey, which revealed that 82% of CFOs consider investing in advanced data analytics technologies and financial tools to be a top priority today.
However, more than dedicating time and resources to technology in financial management, it's crucial to know where to invest. To help you with this, we've prepared this content with 5 essential technologies for the financial executive of the future. Check it out!
The role of the CFO in the digital age.
The modern CFO has become an even more crucial piece for the success of organizations. Today, this professional is no longer just responsible for controlling finances, but also fulfills an essential strategic role.
To the new challenges To effectively perform this new role, it is mandatory to keep up with the evolving digital landscape, suggesting and often coordinating the implementation of new solutions and tools.
In addition to promoting the financial viability of these projects, the CFO of the digital age is generally responsible for evaluating the return on investment of each solution, assisting senior management in defining priorities.
In this scenario, the CFO himself needs to rely on modern tools that allow him to maximize his time, optimize financial processes and, above all, provide valuable information in a timely manner to guide his decisions.
Financial management technology for the CFO of the future.
Below are some tools and technologies that empower financial executives to become more efficient metrics curators and to obtain and manage high-value strategic insights for the business.
1. ERP System
Enterprise Resource Planning (ERP) systems are not exactly new. Even so, they remain essential for the CFOs of the future.
Although the concept of these systems is already well-established in business practice, the leading solutions on the market continue to evolve and bring new features and functionalities.
It's easier than ever for a CFO to have a centralized, accurate, and up-to-date view of essential elements such as e-commerce, sales, payroll, inventory, and accounting.
Furthermore, the most modern solutions, developed in the cloud, offer rapid adaptation to market changes, providing, for example, flexibility for adopting new work arrangements and scalability to keep pace with business evolution.
For ambitious and fast-growing companies, a cloud-based ERP system is indispensable, as it further enhances a CFO's ability to track, simplify, and control processes and costs.
2. Internet of Things (IoT)
It's no exaggeration to say that the Internet of Things (IoT) is a game-changer for CFOs.
For decades, a significant challenge for finance teams has always been accurately tracking spending on everything from printer ink to electricity.
The application of technology in financial management has finally begun to offer effective solutions to overcome this issue.
Using IoT, things – whether printers, air conditioning units, smart meters, or even refrigerators in rest areas – can communicate with each other and provide information about how they work.
In this way, CFOs can now have a more accurate view than ever before of expenses and costs, including what, how, and when organizational resources are being consumed.
Moreover, because the data is available in real time, patterns can be easily identified and tracked to ensure that spending is appropriate and necessary.
It is also easier than ever for CFOs to detect irregularities in any area of expenses, thus allowing for more refined control.
All of this culminates in reduced expenses and, consequently, better financial health, which helps companies make more strategic investments.
3. Big Data
The proliferation of data is difficult to describe and even more difficult to track and analyze accurately.
However, while it may seem like an impossible mountain to climb, being able to capture and analyze data quickly and accurately is extremely important for CFOs, especially when it comes to risk management and fraud identification.
Therefore, having financial management technology focused on Big Data is essential.
Data analytics tools allow you to identify patterns, insights, trends, and deviations, and can be used by CFOs as well as other company managers.
It is worth highlighting that the use of an ERP system is extremely valuable for adopting a Big Data strategy, since this solution brings together business data in a single centralized database, facilitating data capture and mining.
4 Blockchain
A major highlight of the use of technology in financial management is Blockchain. It is a system of linear blocks of records, each 'chained' to its neighboring blocks in chronological order.
A simple analogy for how blockchain technology works can be compared to how a Google Docs document works.
When you create a Google Doc and share it with a group of people, the document is simply distributed instead of being copied or transferred. This creates a decentralized distribution chain that gives everyone access to the base document at the same time.
Anyone with the appropriate privileges to access the document can modify it, and all changes are recorded in real time, making the modifications completely transparent.
One significant difference to note, however, is that, unlike Google Docs, the original content and data on the blockchain cannot be modified after being recorded, increasing its level of security.
Blockchain has gained significant global prominence as the technology behind Bitcoin and other cryptocurrencies. However, this technology has much more to offer modern businesses.
For the CFO, in particular, this technology has the ability to streamline contract execution, manage extended value chains, and even increase the security of an organization's IT systems.
5. Artificial Intelligence (AI)
As the CFO comes under increasing pressure to find ways to boost profits, cut expenses, and anticipate emerging trends, the risk of burnout within the finance team increases significantly.
Therefore, AI is a fundamental technology in financial management to be considered, as it allows for the elimination of several laborious manual processes, reducing the risk of errors and freeing teams from low-intellectual-value activities.
AI-simulated financial tasks, including account reconciliation, for example, can increase productivity across the entire finance department.
Furthermore, AI systems can also identify deviations that would often go unnoticed by the human eye, thus reducing the risk of fraud.
AI analytics tools can still significantly improve the supplier selection process and even allow the CFO to improve cash flow management.
Finally, the use of this technology in financial management also opens up the possibility of providing valuable insights that highlight future growth prospects. For example, projections and forecasts generated by AI systems allow the CFO to make informed decisions based on computational modeling.
Conclusion
For any CFO who wants to remain relevant and high-performing in the digital age, a good understanding of how to use technology in financial management is essential.
This does not mean, however, that all emerging technologies need to be incorporated into the business. It is up to the CFO to have a clear vision of the benefits offered by each solution and the returns they provide.
However, some solutions, such as a modern ERP system, are essential for finance executives.
In this regard, Oracle NetSuite stands out as the leading system. 100% cloud-based ERP from the market, offering state-of-the-art financial management technology.
With it, you can count on banking integration, optimized cash flow, Reports for simplified financial management. , and more.
Speak with one of Active's specialists and discover the benefits and how to implement Oracle NetSuite in your company!
