Moving your finance function from static to dynamic - The Irish Times

In the rapidly evolving landscape of global markets and new regulatory requirements, traditional finance approaches are proving to be inadequate to keep up with the pace at which information and insights are required.

To remain competitive, organisations need a more dynamic finance function to join up the dots and extrapolate valuable insights in real time.

Dynamic finance in its simplest terms leverages technology to expand the capabilities of teams. This allows the finance team to focus on more value-add work and embrace agility and adaptability.

Driving business decisions

Xiomara Sanchez, partner and dynamic finance lead, classifies the changes facing business into two categories—internal and external. “When we look at external, we’re really talking about global disruption, the market shocks that we’re seeing at the moment, that seem to be coming faster and faster,” she says, noting that emerging data regulations requirements are also putting a toll on organisations.

For Sanchez, dynamic finance is all about agility, flexibility, and adaptability: “It is moving finance out of the traditional core role of stewards and guardians of the numbers to be a strategic partner that can drive more value to business decisions and insights."

“At Deloitte, we see finance as being able to play a really important role for the organisation to drive their ambitions. That means stepping outside of their comfort zone but embracing exciting new areas that they can bring a lot of value to.”

“If we take, for example, the new regulatory changes that are coming for CSRD, for the ESG compliance reporting: finance own the data, they have access to the information, they know how to run the systems, they’re at a real pivotal place to put their hand up and say ‘We can take this challenge on behalf of the organisation,’ while organisations are still trying to formalise what the sustainability office will look like for them.”

Building a business case

Carol Trunk is a partner in Deloitte’s enterprise, technology, and performance practice, specialising in SAP. “Real-time access to data is what you need to get a competitive advantage,” she says. “A lot of organisations are looking at their growth plans and how technology should support that,” she notes.

Organisations are considering if there is an opportunity to reduce their technical debt of old technology that isn’t working as efficiently, whether that be by full or selective transformation, or a simpler technical upgrade. For organisations that need to get board approval to sign off on investment, building a valid business case is critical. One organisation Trunk worked with recently were able to identify that they could greatly reduce their tax compliance costs, as well as revenue leakage by creating integrated systems. “We start with getting that business case together for a client and then helping them with the full end-to-end implementation and ongoing support. Having the right expertise is key to making sure that you can deliver on the business case benefits and ensuring that you’re tracking against them.”

The Finance team should be well versed in how data is structured, created, maintained, secured, and consumed—allowing the organisation to be more responsive and flexible with analysis. She advises, “Any project we go into from an implementation perspective, the one thing I will always say is don’t underestimate the effort involved in cleansing & harmonising data, and getting your people involved in that early so that what you put in, you get out from a value perspective.”

Creating meaningful work

Dynamic finance not only allows businesses to envision and respond to both opportunities and threats more quickly, but also creates a thriving finance function within the organisation, where professionals feel valued and engaged with more meaningful and impactful work.

“Dynamic finance is as much about people as it is about technology,” says Danny Gaffney, partner and finance and performance lead at Deloitte. Deloitte’s annual CFO survey brought to light some surprising results this year when it came to attitudes towards adopting dynamic finance strategies.

“The challenges are actually not where we expected them to be,” says Gaffney. “The cost of capital and the finances to fund digital projects was only a blocker for one in four CFOs.” The bigger issues around delivering dynamic finance appear to be around mindset and the capabilities in existing teams.

“CFOs regularly reach out to Deloitte looking for our assistance in terms of being able to provide them both the tools and the capability to provide more timely and more insightful information to the business, so that they’re able to make better business decisions and capitalise on market opportunities.”

“We would regularly bring entire finance teams into Deloitte and run dynamic finance labs showing them the art of the possible in terms of what tools are available and how they might be applied,” he explains, “trying to personalise it and individualise it for their organisation in terms of how best they could apply a portfolio of these tools to solve problems within their function.”

Deloitte’s bespoke online learning platform, FinLearn, offers another tool for client companies to use. By upskilling staff in technology, it releases talent from performing menial and manual tasks, and clients have seen tangible results. At one organisation Gaffney worked with, he says, “How they viewed their role changed, and as a result, the amount of people leaving that organisation vastly reduced.” It also has benefits in terms of talent acquisition and retention. “Leading organisations are attracting a lot more talent as a result of it because people are drawn to work in environments that are more dynamic.”

An organisation with a foundation of agility, resilience, and automated, simplified processes is better set up for success, no matter what comes its way. According to Gaffney, “The CFOs that have made the biggest impact in this space are the ones that have looked at the problem and said, ‘This is the smallest amount of data I’m ever going to have on this. Now is the time to act’.”

This article originally appeared in the Irish Times on Thursday, 31st August 2023.