The game has changed. This year, COVID-19 has put business leaders in an unexpected and transformed environment that has impacted almost every facet of business — including the ability to effectively conduct business competitively.
Because of this, leaders will need to reshape their companies for the new normal, making the promise of agility and market responsiveness an actual reality. Ten-year horizon plans to adopt effective digital technology applications will be massively accelerated. Businesses now need to modernize the back office through software automation in order to be where they intended to be in 2030 by the end of 2021.
Before the pandemic hit, businesses of all types across every industry began 2020 with plans and budgets. They’d made concrete decisions about roadmaps and investment areas. At many companies, budgets included funding plans to incrementally inch forward on long-term digital transformation strategies. Organizations have long understood the need to make progress on how they’re engaging the marketplace, prospective and existing customers, and employees to facilitate engagement through digital means. But just as the unexpected events of this year turned plans and budgets upside down, the economic fallout from the pandemic has introduced a new imperative: to accelerate the modernization of the back office, and specifically, the move to cloud.
Chief financial officers and chief information officers should work together to make this move happen. This acceleration may seem daunting, but companies across the board have already been moving toward digital adoption, including moving to 100 percent cloud. In fact, according to a recent
We’ve all just lived through a real-time demonstration of the truth of those words. COVID-19 pressure-tested the ability for companies to remain productive while working remotely, whether they were already leveraging digital platforms or not. Systems across the board were put to the test, including collaboration frameworks, supply chain networks, VPNs, on-premises ERPs, customer interfacing, and communication tools. Those already relying on best-of-breed cloud solutions and digital technologies for their operations were in a much more agile position to maintain competitive advantage than those scrambling to implement new systems in the midst of a crisis.
What comes after triage mode?
As expected during an ambush, companies went into triage mode when COVID-19 disrupted their operations, cobbling together new operating models to make it to the next week, then to the next month, and then to the next quarter. But now, company leaders are stepping back and asking if these models are sustainable. Those companies that have models dependent on legacy technology and analog processes are clearly not answering that question in the affirmative.
In the pre-COVID-19 economy, enterprise application sales were already incredibly strong. A recent
There’s a reason why almost no startups deploy on-premise technology, and it’s the same reason why we’re seeing a colossal uptick in tech spending that is decoupling the Dow and NASDAQ market indices. We don’t know when, if ever, things will return to what we use to refer to as normal — but we do know that digitally-native talent seeks to work with advanced technologies that enable them to move the needle. The ability to thrive in a rapidly changing world requires that companies provide a working environment where “all hands on deck” can actually be achieved.
Remember the Wall Street Journal article, “
But won’t it be expensive?
Modernizing the back office is a business imperative, and is more affordable and accessible than ever. Fast time to value, high impact, and minimal to no reliance on IT are new standards for businesses and crucial for survival in both the short and long term. Together, CIOs and CFOs must take a close look at where they can make these back-office investments and how new technologies can improve business initiatives, such as freeing up employee time to focus on high-value activities.
Keep in mind that digital transformation is more cost-effective in the long run than continuing to conduct business on legacy systems that hamper competitive advantage and require expensive maintenance and frequent workarounds to maintain basic processes. Back office transformation isn’t about working in the same way, but with greater efficiency; it’s about new possibilities. The pandemic is forcing companies to be more imaginative in finding rapid ways to respond to the needs and demands of the time.
Also, note that digital transformation projects needn’t be gigantic, expensive endeavors that take months or even years to complete. Companies can realize incredible productivity gains and operate with much greater agility with a rapid time to value by deploying a solution that integrates with existing technology and sits above legacy systems, such as a cloud-based financial planning and analysis (FP&A) solution.
Back office modernization must be a CFO-CIO partnership
CFOs should partner with the CIO to drive digital transformation forward, starting with the implementation of the modern, cloud-based tools needed by the CFO’s team to enable real-time analysis to accelerate planning and decision-making. Finance is the logical place to start, since they touch every part of an organization. This enables an opportunity for fast, competitive advantage as the finance team steers the company through the recovery.
A CFO-CIO partnership to drive this initiative makes sense since digital transformation is a shared objective that touches every department in the organization. CFOs and CIOs have a cross-functional purview to match the scale of the endeavor and no data silos to obscure their path. Both work closely with the CEO and both understand that accurate, real-time data is the new oil.
Back office modernization is the rig that can tap into that wealth of data, enriching the business over time and revealing value levers to help the CFO steer the company through prosperous and challenging periods alike, while elevating the financial IQ of the entire organization. If business planning is decision-making (it is), it’s time to plan on accelerating back office modernization through software automation — now.
