Contributed ArticleDigitisation is now a realistic goal for the finance function because of a range of technological advances. Digital technologies and their ability to transform the finance function with improved planning and decision making, streamlined processes, and better cost management, are critical to meeting today’s business challenges. To achieve the most value, the finance function must develop a digital strategy that aligns with the company’s digital framework.
There are four areas of technology right now:
- Automation and robotics to improve processes in finance
- Data visualisation to give end users access to real-time financial information and improve organisational performance
- Advanced analytics for finance operations to accelerate decision support
- Advanced analytics for overall business operations to uncover hidden growth opportunities.
Digital finance offers CFOs a way to deliver on ever increasing expectations and provide the kind of real-time financial insights needed in today’s complex, incredibly competitive environment. It is a transformation that will not happen overnight – but CFOs who take action now to understand digital finance’s potential, and start to plan their way forward, may be able to provide their organisation with a large edge.
Whether it is robotics, artificial intelligence or the cloud, advances in technology present a golden opportunity for the finance function. In addition, analytics and artificial intelligence are creating scenarios where a virtual finance platform can be built on top of core systems without having to change or update them. This gives finance the freedom to improve without moving or changing the core essential systems that typically have a large overhead to change.
For the financial services industry, block chain will become integral for transactions both within and between enterprises. This technology will enable all transactions to be recorded and traced and will provide the customer with a digital log of previous payments, receipts, timestamps, warranties, and contracts. This provides a much cheaper and more efficient way of tracing all interactions, whether that be B2B or between banks and customers.
Customers will increasingly expect their financial providers to understand their needs and preferences. Providers that fail to do this, will lose valuable customers.
Data analytics will enable businesses to store useful information on customer activities across all channels. Because of this, customer intelligence is going to be the most important predictor for revenue growth and profitability
While a small handful of financial institutions recognised the value of AI technology and invested early, the majority are now catching on.
Through the advances made by big data analytics, open source software, cloud computing and fast processing speeds, customers regularly come face to face with AI, whether it is through online banking or the investment banking system. Through AI technology and robotics, banks will be able to automate various tasks at much lower costs. Previous tasks conducted by people, can now easily be carried out through robotics and AI, often at higher quality and lower cost. This change is going to have a knock-on effect on outsource financial centers around the world.
The media is constantly picking up on security breaches across industries and the finance industry is no exception. The barrier for hackers is currently relatively low, with organisations taking up to nine months before they realise they have been breached. As cyber security becomes a growing concern for both customers and as providers, we can expect this to be top of the agenda for financial institutions in the current time.
Block chain technology will have a major role to play in safeguarding against hackers and improving security as it extends security levels beyond two factor authentications.
For the financial services industry, technology will continue to offer new ways to digitally spend, manage, invest, and protect money and investments. This transformation is forcing the entire industry to rethink how it operates and the services it provides. The implications for the financial services industry are massive—and the opportunity to act or react is now, if not yesterday.
Key takeaways
- CFOs who take action now to understand digital finance may be able to provide their organisation with an edge.
- Block chain technology will have a role to play in safeguarding against hackers as it extends security beyond two factor authentications.
- While a handful of financial institutions recognised the value of AI and invested early majority are catching on.
- Whether it is robotics, artificial intelligence or cloud, advances in technology present a golden opportunity for the finance function.
- Technologies are creating scenarios where a virtual finance platform can be built on top of core systems without having to change them.
- Finance has freedom to improve without changing the core system that typically have a large overhead to change.
Transformative technologies offer finance an opportunity to change without replacing core systems explains Mahmood Bangara at the ICAI Dubai Chapter.
