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Finance managers face increased responsibilities around business guidance and growth. Robynne Sisco, chief accounting officer at Workday, explains how moving finance operations to the cloud can support these expanded roles.
The role of the chief accounting officer has changed substantially over the past 20 years. Our job is no longer just about the numbers—executives increasingly look to the CAO to deliver real-time insights about the health of the businesses and to help guide future growth. At the same time, the rise of globalisation has made financial management more complex in many ways, including differing and changing regulatory environments.
Yet as CAOs face these increased pressures and responsibilities, they find themselves and their teams limited by outdated, legacy financial management systems. As a result, it’s important for finance professionals to investigate the emergence of modern cloud-based financial systems and understand why these systems do a better job of supporting today’s CAOs. What’s more, the term “cloud” can be used rather loosely in the market these days, and it’s important to identify the characteristics of a real cloud-based system. In this article, I’ll share the benefits I’ve experienced over the past three years using a cloud-based financial system compared with the legacy systems I’ve used throughout my career.
One of the biggest problems with legacy financial management is that financial, workforce, and operational data is spread out across multiple disparate systems, or on paper documents stored in binders or file cabinets, making it almost impossible to consolidate and reconcile data in order to glean meaningful insights. Yet if this work is attempted, by the time reports are completed the data is out of date and contains little clarity on where numbers are sourced from, making it difficult for a CAO to provide a current update on the business.
A well-designed cloud-based financial management system, however, unifies all of an organisation’s finance and human resources data within a single system, resulting in one source for data. It should also offer built-in analytics, making it possible for even non-technical finance managers to drill down and gain insights into the business based on the current, real-time data living within the system.
As a result, CAOs can spend less time looking back and reconciling historical information, and instead can look forward to identify trends and areas for business improvements.
No more on-premise upgrades
On-premise financial management software upgrades are expensive and can take more than a year to complete, and many organisations end up delaying them until they have the time and resources to handle the disruption caused by a software upgrade. By the time the upgrade is complete very little has been gained in terms of new features and functionality, making the time and financial investment seem like a waste.
In comparison, a provider of a real cloud-based financial system will deliver major updates to its customers online in a matter of hours, not months. If the vendor is truly using a cloud-based architecture, it also is able to deliver a steady stream of smaller updates and innovations that improve the customer experience and support new requirements throughout the year, as often as every week.
Managing global complexities
A cloud-based financial system is also better suited to managing the complexities of globalisation. Consider the consolidation of legal entities across multiple countries that use different currencies, for example; in a legacy system that can take hours to complete and often entails interfacing sub ledgers, performing currency conversions, and booking intercompany eliminations.
A consolidation in the cloud, however, may take only minutes if the system has been designed to offer configurable organisational structures and business process. Additionally, the ability to add operating entities, contract in new currencies, add new products to the revenue streams, and other changes can be completed quickly and accounted for accurately in one centrally-managed system. This means that your financial system can keep up with your business expansions and other changes in a matter of minutes, instead of the months such changes would take on a legacy system.
These are three distinct advantages to real cloud-based financial management systems that CAOs would recognise right away, but there are more. I would recommend that CAOs and their colleagues take the time to examine what these systems have to offer. In my view, most finance organisations will move to a cloud environment in time. Regardless of the trigger, the cloud is the future for finance.