WINNING FINANCE

TRANSFORMATION:
INSIGHTS FOR SUCCESS

Prepared by IMA India in collaboration with IBM India

Contents
03 Introduction and Overview

05 Evolving CXO Priorities

07 Digital Transformation:
The New Finance Mandate

08 Achieving Digital
Transformation: Guidelines
For Success

12 Digital Finance: Emerging

Use Cases

17 Driving the Finance Digital

Agenda: A Call to Action
INTRODUCTION & OVERVIEW

In today's fast-shifting business landscape, organisations need to be more operationally

agile than ever. Covid-19 has added another layer of complexity to strategy and planning
while driving a sense of urgency. This is prompting organisations to enhance their change-
enabling capabilities. For years, Finance has led the digital agenda at most organisations,
often being the first function to apply state-of-the-art technologies to improve
productivity and efficiency. The disruption caused by the pandemic has forced it to further
accelerate tech adoption.

To drive transformation in such an environment, CFOs need to manage complexity at

scale while becoming more adept in their use of analytics and big data. Revamping the
Finance operating model by investing in Shared Services Centers (SSCs)/Centre of
Excellence (CoE), technology upgrades, and crucially, Finance staff training and
retraining, will be equally critical. Creating value is the ultimate goal and Finance must
focus on more value-added work and decision support which would require operational
processes to be centralised through SSCs/CoEs or outsourcing.

This study, which has been developed by IMA India in collaboration with IBM India, is
based on conversations with the CFOs of several leading organisations operating in India.
Drawing on their learning and experiences, it offers some guidelines for success as well as
potential pitfalls to avoid.

Business and Finance Priorities

• Increasingly, companies are focusing on sustainable efforts to adapt to the new
reality, build resilience and tap new business opportunities.
• The pandemic-induced uncertainty has forced companies to evaluate their resource
allocation strategies and align them to long-term business objectives.
• Developing a talent strategy that places workers at the centre of the company is a
top priority for executives. Succession planning is a critical concern for leaders.
• The ability to quickly adjust one’s product and service portfolios to respond to fast-
changing consumer needs has become a key focus area.
• Developing strong analytical capabilities with a focus on real-time and predictive
analytics ranks high up on the leadership agenda.
• CFOs’ top objective for 2021 and beyond is to improve Finance’s digital capabilities
– such as the use of emerging technologies, enhanced data analytics, cloud-based
systems, and apps that are embedded with strong processes and robust data
governance.

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Guidelines to achieve successful digital transformation outcomes
• Look beyond RoI/cost/productivity targets to consider the overall value that the
transformation initiatives are expected to generate for the organisation.
• Ensure the Finance digital agenda has a clear roadmap for the transformation
journey and is tied to the company’s broader business and digital strategy.
• Identify a sponsor from top management who will support the digital agenda.
• Build the right transformation team, with a mix of people who can manage day-to-
day operations and those who can handle change.
• Leverage AI/ML tools to build capability in predictive analytics for decision
support.
• Emphasise both digital and business skills across the Finance department to build a
well-rounded transformational team. Work with a strategic partner who brings in
both technology and operations transformation experience.
• Collaborate closely with IT and business heads to understand the process pain-
points as well as technological capabilities that are required.
• Establish a strong data governance architecture and change management plan before
embarking on a digital transformation journey.
• Reorient the Finance operating model by setting up a Shared Service Centre
(SSC)/Centre of Excellence (CoE) that not only takes care of transactional work
but also enables process innovation, an improved user experience and employee
satisfaction.

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EVOLVING CXO PRIORITIES

Covid-19 has been the biggest disruptor in living memory of nearly every aspect of
business. Companies are operating in a complex environment accentuated by redefined
customer expectations, vulnerable supply chains and new work models. Having recovered
from a point where business continuity was the top priority, organisations are now moving
toward sustainable efforts to adapt to the new reality, build resilience and tap new
opportunities. Our conversations with the Finance Heads of leading companies revealed
what companies are doing to adapt, transform and grow in a post-Covid economy.

• Aligning resources with long-term business goals: Companies are responding to

the pandemic in two ways: those hit hardest by the crisis are restructuring,
reorganising or downsizing, while others are reshaping their business models around
resources, skill sets and competencies. For both groups, however, digital
competencies have become even more critical.

• Revisiting the Talent Management Strategy: Top CXO priorities in a

People are a company’s single most important post-Covid world:
component. Consequently, it is no surprise that • Align resources with
long-term business
developing a talent strategy that places workers at
goals
the centre of the company is a top priority for • Revisit the Talent
executives. Building a purpose-driven organisation, Management Strategy
introducing new work patterns and workforce • Enable Rapid
planning, improving agility and establishing a Innovation
culture of constant feedback are all receiving fresh • Improve Analytical
attention. Equally, developing a robust succession Capabilities
planning system has become a top concern for
leaders.
• Enabling Rapid Innovation: While product/service innovation has long been a
key focus area, the pandemic has pushed companies to adjust their product and
service portfolio in view of changing consumer needs. The challenge is to assess
which products/services innovations are essential in a post-Covid world, and how
quickly companies can respond to new demands. Most retailers have bolstered their
e-Commerce channels in light of shifting consumer preferences. In the case of
Arvind Fashions, which clocks 35% of its total sales from digital, an omni-channel
retail marketplace (Arvind Internet) was augmented to provide a seamless platform
for online sales. Arvind Internet has also been used by offline retailers such as Bata
and Wildcraft as technological and back-end support to help them go live with their
omni channel services in a short span of time.

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 Similarly, Shopper’s Stop quickly adapted its e-Commerce model. From e-
Commerce sales of just ~1% prior to the pandemic, it now generates over 10% of
its total sales through online channels. For Godrej Consumer Products Limited
(GCPL), sales through e-Commerce, from about 2% 3 years ago, is now expected
to be close to 8% in the next 3-4 years.

• Improving Analytical Capabilities: More and more companies are focusing on

real-time and predictive analytics that can quickly and accurately identify changes in
consumers’ buying patterns. To achieve that, it is important to have a ‘single version
of the truth’ – which essentially means that data should be entered only once by
someone from within the ecosystem, whether a vendor, a customer or a consultant,
who knows that data innately. Further, organisations must plan their data
architecture and governance mechanisms, backing this up by a holistic data and
analytics strategy.

For instance, Shoppers Stop is replacing its legacy system (which it implemented in
1999) with SAP’s S4/Hana. This would make it the first retail company in India to
have the latest SAP system, enabling it to produce real-time reports, improve its e-
Commerce operations and ensuring strong governance. Biocon Biologics is also
moving to implement SAP’s S4/Hana with the aim of achieving real-time visibility
into crucial KPIs using a machine learning-based model. This will help the company
accurately predict revenues and margins. Further, Biocon will be extending the use
of advanced analytics to multiple processes, including R&D, where video analytics
of CCTV footage can be used to track productivity and employee negligence, or
even to track energy usage, thereby improving the performance of its reactors.

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DIGITAL TRANSFORMATION:
THE NEW FINANCE MANDATE
For the last three decades, Finance has been at the forefront of using tech adoption to
drive efficiency and productivity improvements. Emerging technologies such as AI,
predictive analytics (PA), machine learning (ML) and robotic process automation (RPA)
bring tangible benefits such as cost savings, lower HR counts and reduced output delivery
time. Further, with the rising popularity of Centres of Excellence (CoEs), there is a
growing interdependency between retained organisations and shared services, presenting
huge opportunities for technology deployment not just within function but across the
supply chain.
Finance in any organisation is uniquely positioned to have The Finance function is
visibility across other functions' KPIs and therefore, leading the charge in
make an impact. It should use ‘intelligent enterprise workflows’ driving digital
transformation to move
as a means to help achieve organisations' objectives. For
from being a reactive or
instance, ‘supplier payments on time’ is a key parameter reporting-driven function,
for any organisation (or it should be) but achieving it to one that is proactive,
requires an in-depth review of the entire source-to-pay guidance-driven and
(S2P) process. future-oriented.

In 2020, it became evident whether a Finance organisation was truly automated or was
instead working with make-shift digital arrangements around core-Finance capabilities.
Those in the first group were far more agile in terms of resuming key Finance activities
hindered by Covid-related interruptions. Those in the second group were slower to adapt
and experienced greater difficulties with virtual collaboration. Clearly, for some Finance
functions, the experience of the last 18 months accentuated the need for them to bolster
their digital skills.

CFOs play a central role, alongside their executive peers, in driving the enterprise’s digital
agenda. Not surprisingly, Finance executives’ top objective in 2021 and beyond is to
improve digital Finance capabilities – such as the use of emerging technologies, enhanced
data analytics, cloud-based systems, and apps embedded with robust processes and strong
data governance. Yet, while starting the automation journey looks easy, relatively few
companies are able to reap the desired benefits, and there often remains a gap between
promise and delivery. A lot depends on the technology adoption process itself: Are
organisations automating for the right reasons? Are they planning for a proof of concept
or setting up for a scaled automated operation? Are they automating themselves or
involving an expert? Are they selecting suitable technologies? Are they prioritising
convenience over rigour, and involving stakeholders appropriately? Most importantly, are
they measuring the right outcomes?

The next section evaluates these issues in detail and provides practical insights on how to
drive the digital Finance agenda for lasting success.
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ACHIEVING DIGITAL TRANSFORMATION:
GUIDELINES FOR SUCCESS
Our conversations with CFOs at leading organisations revealed valuable insights on the
extent and nature of digital transformation that is being undertaken across companies,
and highlighted the approaches that generate successful outcomes.

Finance digital transformation (DX) is a term that each company may interpret differently.
For one firm, it could be about redefining the Finance operating model. For another, it
might be about closing the accounts faster, consolidating on a single general ledger,
implementing a new planning tool, or completely overhauling the Finance department.
The most difficult issue, however, is determining where to begin and how to carry out the
necessary changes. Ultimately, each company has to chart its own path but those that
figure out how to make technology work will be the ones that get ahead.

Look beyond RoIs

Often, the most successful technology Guidelines to achieve successful
digital transformation outcomes:
transformation efforts are those whose goals are
• Look beyond cost saving
not based around cost targets. Instead, their key • Have the right team in place
performance indicators (KPIs) are based on • Collaborate with business
‘value’. Given the phenomenal rate of heads
technology obsolescence, a particular technology • Address structural challenges
might become outdated even before one starts to before automating
earn an RoI from it. Hence, Finance leaders must • Reorient the Finance
shift their mind-set from cost management to operating model
value creation.

For instance, a global consumer products company developed a set of standard KPIs that
were aligned to the company's overall value-creation strategy. It then constructed a data lake
containing all of the relevant indicators – such as average time-to-sell, product margins,
supply-chain costs – and populating the information in real-time after harmonising these
measures across numerous business units and geographies. The data lake enabled real-time
dashboards that displayed KPIs and financial performance data from the general ledger, as
well as drill-down functionality. The programme successfully reduced the time spent by the
Finance team collecting, presenting and manipulating data by more than 60%.

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Create the right team
Ideally, the strongest talent should lead transformation initiatives. In practice, however,
CFOs are reluctant to assign such individuals to ‘key projects.’ As a mid-way point, the
transformation team should be a mix of people who can manage day-to-day operations
and those who are good at handling bigger initiatives. In some organisations, a dedicated
transformation team is formed to drive such initiatives. As a whole, the team must possess
the right capabilities, strong motivation and a shared vision. An in-depth capability
assessment can help identify skill gaps, and remedial steps can be taken to address these
gaps through training/coaching or by hiring new people. The emphasis should be on
embedding digital skills across the Finance department and developing a core of business-
savvy Finance leaders who can be moved easily throughout the organisation. Many
organisations cycle Finance executives through non-financial positions to build a balance
of technical and business skills. IBM, for instance, has adopted a ‘Garage Methodology’ –
a cultural movement that is characterised by collaboration across roles, focus on business
(instead of departmental objectives), trust, and value placed on learning through
experimentation. Leaders work with their squads (people with unique predispositions,
experiences, and biases) that have shared responsibility to deliver new capabilities quickly
and safely.

Nayara Energy embarked on a four-year-long Finance-technology transformation

journey in 2017. It adopted a three-tier approach, focussing first on infrastructure, then on
transactions and finally on analytics. To drive implementation, three committees –
transformation, procurement and investment – were roped in. The transformation team,
working under the CFO and in collaboration with the business, was tasked with evaluating
and arriving at the best possible technology suite. The procurement committee validated
the spends, and the investment committee assessed and tracked potential benefits. The
three committees worked together to make all technology decisions, which were then
presented to the Board, which monitored the entire process.

Collaborate closely with IT and business

Across the financial, operational and strategic space, Moving Finance
executives through
technology is the one common value-driver. Unless firms
non-financial positions
continually upgrade and replenish their technology, their helps build a balance
ability to create value will suffer. Value creation is thus the of technical as well as
end-game, and the CFO’s role is to ensure that technology business skills
decision-making is done on the basis of value maximisation.
The aim should be to metricise intangible but growth-enabling investments and to evaluate
technology proposals in partnership with the CTO while keeping affordability in mind.
CFOs must themselves be comfortable with the technologies they plan to adopt, which in
turn will encourage others to embrace technology and up-skill themselves.
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At an Indian multinational two and three wheeler manufacturing company, for
instance, both Finance and IT collaborate towards the common goal of enhancing the
organisation’s technical capability. Every new trainee in Finance spends 3 days learning
SAP so as to understand the whole architecture, methods, structure and type of accounts
involved, and to develop a minimum level of technical expertise. This helps Finance
executives collaborate closely and meaningfully with SAP consultants, who bring in both
technical and functional expertise. Today, digital Finance is helping the company manage a
turnover of Rs 30,000 crores with just 85 people in the team.

Fix processes before automating

Most Finance transformation initiatives focus on Digital Finance is helping
technology as the primary solution for underlying issues. an Indian two and three
However, implementing a new technology without wheeler manufacturer
addressing process/structural challenges may not achieve manage a turnover of Rs
the intended benefits. To that end, a stringent process 30,000 crores with just 85
review might help unearth inadequacies that must be people in the team
overcome before embarking on the transformation
journey; and technology is a key enabler in that regard.

A strong data governance process, for instance, is critical before embarking on the
Finance transformation journey. Given Finance’s central role, it is well-positioned to
define the master data management strategy for the enterprise to guide the collection,
storage and analysis of the rising data volumes needed to generate business insights. CFOs
need to play a critical role in setting high standards for data structure, storage and
protection across the company.

Reorient the operating model

According to most CFOs, the lack of an advanced operating model is at the core of their
inability to manage a standardised, effective and efficient Finance organisation. The new
Finance operating model must have a lean core, fool-proof data management practices,
high levels of automation, and strong integration with a wide range of digital
technologies.

Reorienting the Finance operating model may, in many cases, require CFOs to set up
Shared Service Centres (SSCs)/Centres of Excellence (CoEs) that not only take care of
transactional work but also enable process innovation, an improved user experience and
greater employee satisfaction.

The majority of companies we spoke to either do not have an SSC/CoE currently or are
leveraging them for basic transactional work. Further, many shared-services projects target
cost and productivity improvements within a single process (such as accounts payable).

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The more advanced companies are leveraging their SSCs to
provide end-to-end process support across multiple Finance organisations must
processes (such as procure to pay, order to cash) by stacking advance their operating
advanced technologies such as AI, ML, RPA. Building a models by effectively
sophisticated SSC requires a focus on improving the three leveraging Shared Service
Centres/Centres of
main components of shared services: implementing
Excellence
advanced technologies, improving staff capabilities
(such as problem-solving and communication) and
standardising processes.

As companies look at managing complexity at scale, they must review processes to enable
speed in areas where rule-based transactions are a norm. Simultaneously, the focus should be
on improving the quality of decision making by leveraging analytics and risk based alerts.

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DIGITAL FINANCE: EMERGING USE CASES

The concept of a ‘digital Finance organisation’ raises questions on how far the function
can be automated in terms of sub-processes and to what extent it can actually rely on
technology for effective operation. The following areas show promising use-case scenarios
for use of technology in Finance:

• Enterprise data management: Many organisations are using Robotic Process

Automation (RPA) tools to raise the efficiency of their internal operations and
processes, effectively automating rule-based, routine tasks that are usually carried out
manually. For instance, an Indian tyre manufacturing company deployed RPA to
create database profiles for new vendors, and to update information on existing
vendors – something that typically involves intense manual interventions. By applying
RPA to the task, Finance’s overall productivity within the shared service group
increased by nearly 20%.

At a broader level, Unilever’s journey towards automation highlights the phenomenal

impact technology can have on the business ecosystem. The company’s pan-India
distribution network is digitised to such an extent that it can detect stock-outs before
they occur at a particular store.

Similarly, Continental uses EDI (Electronic Data Interchange) for data transfers
between the company and its customers/vendors. By picking up data from the
underlying systems, it allows suppliers to directly check on the status of payments. It is
also working to incorporate AI through chat-bots that can dispense invoices, payment
remittances, etc as well as RPA and co-bots (robots that interact with humans) in its
manufacturing lines.
More and more
An Indian multinational two and three-wheeler organisations are
manufacturing company has also adopted EDI to connect leveraging RPA
vendors, who can operate through a GTP (great trade tools to automate
process) on a self-certification basis to get a complete rule-based, routine
tasks
pass-through for material-transportation vehicles.
The system is linked to GPS to optimise material-resource planning. This seamlessness
of operations helps vendors to minimise their working capital. Over time, these
changes shape a culture of automation, which originates from Finance but becomes
pervasive organisation-wide.

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• Payment management: Some companies are leveraging smart technologies to
automate their payment management process. Marico, for instance, deployed a bot
that enables end-to-end process management by cross-referencing bank balances
with the general ledger, creating journal entries in the system and notifying the right
personnel in case of any errors. By working on predefined programmes, the bot
ensures error-free work, allowing the treasury manager to focus on more rewarding,
valuable and creative work. In tangible terms, this has led to savings of 150 man-
days per annum.

Similarly, GCPL was able to process 70% of its Using advanced

invoices using bots, up from pre-Covid levels of 55- technologies in the
60%. Prior to the pandemic, Nayara Energy had payment management
process can create
automated its Procure-to-Pay (P2P) systems, allowing
commercial
it to cater to everything from tendering and vendor opportunities for the
on-boarding to procurement. With the onset of the business.
crisis, it invested in SAP’s VIM (a vendor-invoice
management system), which automated invoice-processing and helped the company
achieve a first pass-through rate of ~80% and reduce its processing time from 35
days to just 4 days. The processed invoices are put up for an auction which anyone
can pick up at a 12-13% instant discount. This benefits all of the concerned parties.
While the company is able to get a 12-13% saving (or nearly an additional 5% on the
float) against an overnight investment rate of 5-7%, vendors receive payments more
promptly.
Today, Nayara is testing the Conga platform as a means to process large volumes of
contracts associated with its 6,000 outlets. This will help streamline workflows and
create/deliver digital documents, quotes and contracts more effectively.

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• GST reconciliation: Tax-related automation solutions that optimise costs, prevent
credit leakages and reduce tax compliance risks are great value-enablers. For
example, Beumer India has deployed a bot to claim GST credit on employee airline
travel. The bot reads through different airline invoices, extracts the relevant GST
information and tallies it with the organisation’s data while identifying any potential
credit losses. Deploying this process has saved the company Rs 1 million a year.
Cipla has fully automated its GSTR filing for both inward and outward data. The
data is auto-reconciled and uploaded from the company’s SAP platform on to the
GSTN portal with the help of SAP and robotics. By eliminating manual
interventions, it has not only enabled a faster and more streamlined process but has
also improved its GST compliance.

• Data visualisation: Finance organisations have started to combine automation

capabilities with data-visualisation technologies to create actionable, visually
appealing and timely business reports. Titan’s Finance function, for instance, has
deployed a self-service approach. On the 6th of every month – books are closed by
the 5th – it generates a 100-page business report with easy-to-read information and
intuitive graphs. This drives efficiency – senior executives can collectively review
company performance by the 8th of every month – while significantly reducing the
cost of reporting. Similarly, DCM Shriram, a leading business conglomerate that
manufactures fertilisers, cement and agri chemicals, is able to generate a flash MIS
(without charts with basic details) for the entire group on the 2nd of every month –
for the books closed by the first – and a detailed MIS (with sophisticated charts) by
the 5th. The company is now moving towards leveraging data visualisation tools to
understand the linkages between complex variables such as manager’s business travel
expenses and sales in a particular region.

Cipla initiated ‘Project Insight’ – a digital builder project within Finance that aims
to deliver a real-time, visually impactful, end-to-end integrated view of all the key
metrics – to standardise reporting, automate MIS generation and allow predictive
analytics. This laid the foundations for building a data lake to manage, govern and
access on-demand data. Nayara Energy has set up an automated system for
business process planning and consolidation (BPP) that incorporates all of the
schedules – including Indian GAAP and Ind-AS, IFRS and Russian GAAP – that
the company must follow as an entity registered in multiple geographies. As a result,
it is now able to close it books by the 2nd of each month, as against the 7th or 8th
earlier.

• Supply chain management: Through data-driven intelligence, analytics can power

superior business performance. Typically, Finance sits on troves of data that, with

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the right tools, can help uncover new sources of value and efficiencies. At GCPL,
Finance is partnering with sales to develop a tool that can evaluate measures to
reduce freight costs and optimise supply-chain costs.

At Marico, Finance uses advanced exception analytics to improve controls and

optimise value in terms of procurement, supply chain and sales spends. The broad
spectrum of information – from high-level KPIs to granular process data – helps
identify and mitigate a host of risks/exceptions without human involvement, and
results in improved efficiency, cost optimisation and value creation.

NESTLÉ’S TRANSFORMATION JOURNEY: FROM PROCESS ENGINEERING TO

TECHNOLOGY

Nestlé India has struck a fine balance between big-ticket investments (reporting and
analytics, operations, consultants, in-house resources) and the ‘smaller things.’ Being
a production house, the Finance team was earlier delivering nearly 150 reports a
month, half of which are now automated, a quarter eliminated and the remaining
simplified. This has led to savings of more than 6,000 man-hours. Some key
developments in Nestlé’s journey include:

o Successful transition from data overload to meaningful insights and ‘continuous

improvement.’ In fact, Nestlé is the biggest SAP customer in the world and is
looking to soon roll out a global upgrade of SAP S4/Hana.
o Local offices leveraging global tools to make quick decisions. Tools like Power
BI, reporting repositories and dash-boarding ensure ‘one source of the truth’
by consolidating all reports in one place.
o MIDAS, Nestlé’s multi-disciplinary internal analytics solution, which was
developed indigenously by the company’s India business, is a data lake
capturing vast data on products, SKUs, distributors, customers etc. The
platform delivers insights using AI and big data (leveraging both internal and
external information) and is built on Azure, a cloud platform that is used
organisation-wide. It has 10 in-built use-cases, including several in sales, from
simple things like dash-boarding and reporting replacement requirements, to
identifying and optimising what items should be sold in each area/store
based on different tastes, consumer profiles, and distances to ship across with
factories/warehouses spread across India.
o With organised workflows and state-of-the-art bots, nearly 10,000 customer
documents per month are now 99% digitised in the form of web forms,
invoicing platforms and customer claims, leading to significant improvement
in workflow efficiency.

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• Pricing: Predictive analytics can help optimise pricing decisions. GCPL uses
analytical tools to predict revenue growth and determine competitive pricing. In-
house tools capture past as well as current trends, and internal as well as external
data, in a data lake. The tool assesses a host of indicators such as competitor prices,
market share, the company’s own sales and those of competitors, and highlights
trends and relative pricing to optimise pricing decisions.

The Finance team at Future Group buckets technology adoption into three
categories. At the most basic level, it has centralised and automated key processes
such as commercial payments, yielding annual savings of close to Rs 450 million. At
the next level, digitisation is used to improve pricing outcomes. Lastly, specific to its
food segment, it uses a platform (‘Agribid’) that aids vendor selection and on-
boarding through a reverse-auction process. So far, the company has been able to
generate a 200-bps improvement in gross margins.

• Transaction processing: Leading companies have started leveraging blockchain

technology to record, reconcile and report financial transactions. Blockchain creates
a single, shared digital ledger. To protect the integrity of data, each block must be
validated by every participant and secured using electronic cryptography, wherein
changes cannot be made without the approval of all participants. This greatly helps
in transforming accounting processes as, instead of having, say, 3 people validate a
particular transaction, blockchain does it automatically and more securely.

IBM now uses it for indirect tax filing and regulatory compliance. The company
imports hardware from Mexico and Singapore and operates as a distributor in India.
It must, therefore, depend on multiple sources for documentation, making
blockchain an ideal platform to ensure the integrity of transactions.

Similarly, Wipro for years worked on predicting revenues manually, but the
application of AI to the task of using varying revenue-recognition norms, and
different billing rates for employees engaged in 10,000 projects has made it more
efficient. Through a home-grown solution, Wipro was able to eventually identify the
variables that impacted the bottom line. In just over six quarters, the model moved
from 98% accuracy to 99.8% levels.

16
DRIVING THE FINANCE DIGITAL AGENDA:
A CALL TO ACTION
CFOs can jump-start the Finance digital agenda by reviewing the use cases and assessing
how they stack up against each of the digital technologies identified. They should do a
thorough value analysis of the benefits of digitising. In parallel, Finance leaders should
work with business leaders to identify pain points in different processes, such as delayed
reporting and missing data. They should also conduct a full assessment of technological
capabilities, alongside IT, to establish system requirements and investments.

However, to establish a successful digital Finance function, CFOs will need to deal with
company-level and talent-related challenges, as well as ensure that Finance's digital agenda
is tied to the company's broader business strategy. Lastly, CFOs should promote strong
cross-functional collaboration between IT and business teams.

Listed below are the challenges that often come in the way, and action steps that CFOs
can take to drive digital transformation forward within their function.

Challenges Action Steps

Lack of a clear overall digital Develop a joint digital vision after consulting with
vision representatives from different parts of the organisation

Digital efforts are not tied to a Identify common elements linked to a broader corporate
larger business strategy strategy and monitor outcomes regularly

Inability to justify cost spends Build a business case that goes beyond cost metrics and
focuses on the value generated for the function as well as the
organisation

Inadequate support from the top Identify a sponsor from top management who will support
the digital agenda

High proportion of transactional Conduct a deep analyses of repetitive transactional activities

activities within Finance that could be moved to an SSC/CoE

Pushback in Finance on account Establish incentive structures and clear lines of

of digitisation-related communication with employees to on-board them
developments
Lack of understanding between Work in cross-functional teams to integrate business-unit
the Finance and business teams views

Gaps in current capabilities and Set up a dedicated capability-building programme in Finance

those required in digital Finance and invest in top talent. Engage with external experts who
can advise on technology, data and process, and handhold
the organisation through the transformation journey

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ABOUT THE RESEARCH EXERCISE
This research paper has been developed by IMA India in collaboration with
IBM India and is based on multiple conversations with CFOs of Indian
and multinational companies. The insights gathered from CFOs were
enhanced by IMA’s in-house research team on the basis of desk research.

The paper is meant for the exclusive consumption of IMA’s Peer Group Forum
members and that of IBM’s clients, and may not be copied, shared or distributed
without the explicit permission of both these organisations.

ABOUT IMA INDIA

IMA is a niche economic, business and market research firm that provides
insights and analysis to top management audiences in India through
multiple channels. For 27 years, IMA’s research and opinion have informed
the perspectives of investors, industry and government. IMA is one of the
country’s largest research-based peer group platforms exclusively for top
management executives, comprising more than 2,500 Indian and global
business/functional heads from over 1,500 member companies. Since
1994, the firm has developed an unmatched capability to harness and distil
collective wisdom, enabling top managers and industry leaders to interpret
changes and forecast developments in the operating environment through
authoritative guidance.

ABOUT IBM INDIA

Since its inception in 1951, IBM India has expanded its operations with
regional headquarters in Bangalore and offices across 20 cities. As a leading
cognitive solutions and cloud platform company, innovation is at the core
of the IBM company strategy. This is reflected in the end-to-end solutions
delivered to clients, which span software and systems hardware to a broad
range of infrastructure, cognitive, cloud and consulting services.

IMA India:

107, Time Square,

1st Floor,
Sushant Lok - I, Block B
Gurgaon - 122002

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