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finance CFO SAP efficient processes digitalization [shutterstock: 750073606, lovelyday12]
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What CFOs Expect From Digitalization

Combining the position of CFO and CIO would be only logical. However, there are no successful examples.

Why is that? Theoretically, the answer is simple. CFOs (Chief Financial Officers) are no longer the last link of the supply chain. They have to be part of core business from the very start.

To test out this theory for myself, I accompanied the CFO in our company to a conference centering around the future of payments and treasury. I learned a lot, to say the least!

Even if I wouldn’t have wanted to test this theory out, it would have been only logical for the CIO and the CFO to attend together. No matter the topic, the core issue is always digitalization. Disruption hinges on combining technology and processes. If the CFO sees potential to standardize a workflow and achieve continuous and automated processes, the CIO can lay the foundation with algorithms and data integration.

Easier said than done

As I said, I learned a lot at the conference. For example, I knew that the R/3 modules FI, AM and CO have been around for decades. What I didn’t know, however, is that SAP neglected numerous FI and CO topics. Functions like treasury, cash and liquidity management, risk management, controlling, finance and accounting, and accounts receivable and payable are available in SAP systems, but not as thorough as CFOs would need them.

My CFO explained that Simple Finance is a good thing, and the SAP module Treasury and Risk Management (TRM) enables good treasury management systems. However, add-ons apparently do it better.

The best combination, he said, would be S/4 Hana and add-ons – which is why he wanted me to come with in the first place.

During the conference, the goal of attending CFOs became clear: efficient processes. CFOs expect more efficient processes and security from the digitalization of treasury management.

As CIO, the goal of efficient financial processes seemed reasonable enough. But increased security through digitalization in finance? That intrigued me. I always thought that our security measures were adequate, but the conference showed me that security in finance means more than having the right technology.

CFOs don’t expect digitalization to bring cost reductions or better decision making. I for one think that as the capabilities of artificial intelligence continue to grow, machine and deep learning will definitely help humans make better decisions.

A friend working at Microsoft showed me what happens when you combine SAP Simple Finance and Microsoft Machine Learning. The resulting accuracy of planning and forecasts was higher than I had ever seen it in any SAP system. The functionalities of Hana PAL are remarkable but pale in comparison to Microsoft’s AI.

What I learned about finance

Many SAP customers see the migration to S/4 as a chance to better integrate their systems. This opens up the possibility of making treasury processes more efficient by using new or optimized system solutions. There are more SAP partners for Simple Finance, Treasury, etc. than I would have ever expected. Consequently, there’s sure to be someone that will have what both CIO and CFO need.

Source:
E-3 Magazine October 2019 (German)

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