How SAP can help Finance to easily adopt technology to thrive in a digital age
This is a unique time. Disruption is coming from many sources: new competitors, new business models. Even the expectations and needs of employees are disrupting work practices. Many of the rigid finance processes that currently exist can no longer effectively meet the needs of businesses. Therefore finance departments are actively looking for technology and solutions that will help them thrive in this digital age. What does digital mean? Digital means everything runs faster, cycle times reduce, information is available to everyone instantly. Matthais Heiden, senior vice president, regional CFO, Middle and Eastern Europe (MEE), says that well in his most recent blog. “The speed of now has never been faster”. He reminds us that “With the increased transparency available, the capital markets are ever more anxious to get information more quickly and benchmark performance against other companies”
Increasing automation, simplifying processes, facilitating collaboration. They are all key strategies to be able to thrive in the fast paced digital economy. Not just automating processes within a company but also between business partners, such as buyers and suppliers. Removing manual steps in company interactions through business networks can generate huge efficiencies. McKinsey research suggests that companies can achieve significant savings in both time and money. They have identified up to 50% increases in efficiency by digitizing shared-services organizations. Business networks can play a major role. Drew Hofler, director of Solutions Marketing for SAP cloud and network solutions, and Friederike Hertenstein, SAP’s director of Accounts Payable Line-of-Business, Finance, discuss that in their recent SAPinsider article. “In a highly connected business-to-business (B2B) digital economy that values visibility and immediacy in the movement of goods and services along the extended supply chain, finance can no longer afford to be separated from its business partners both within and outside its company.
Martin Naraschewski, VP of Finance Solutions, also talks about these opportunities and challenges in his article. “Take Finance into the Digital Age” in the SAPInsider. Naraschewski states that although moving into a digital age is about far more than technology, technology is still a key ingredient. SAP S/4HANA can be a key enabler. SAP S/4HANA removes the need for siloes, as it increases visibility of data, and provides more flexibility in reporting. Transactions, planning and reporting are brought together on one platform.
Many customers look at SAP S/4HANA Finance and see great value. There is the ability to improve cycle time, move towards a soft close, provide instant insight and flexibility of reporting, and radically automate processes. Carsten Hilker, Global Product Owner, Central Finance talks about this in his Insider Article. “A Fast Path to Innovation and Simplification with Central Finance.” He shares that some organizations are reluctant to upgrade, although they would like to take advantage of new innovations. Some organizations also face temporary barriers to undertake the standard deployment path. These companies often have over-customized ERP systems, or heterogeneous system landscape with several SAP and non-SAP ERP systems. So how can these customers still take advantage of the latest SAP Innovations without disrupting their existing ERP systems or carrying out a typical upgrade? This is where the central finance deployment scenario comes in.
Hilker describes Central Finance as “accelerated, non-disruptive SAP S/4HANA Finance deployment option. It replicates financial transactions from SAP and non-SAP ERP source systems onto a Central Finance instance that runs on SAP S/4HANA Finance.”
Central finance allows customers to take advantage of innovations as quickly as possible. Finance transactions are replicated in real time without any disruptions to existing systems. Financial data from different sources systems is harmonized. Customers can take immediately advantage of simplified reporting and analytics. They are able to provideconsolidated financial and management reporting at a detailed level, taking advantage of the speed and flexibility of drill down. In addition, there are processes that can executed centrally. Simplified processes such as intercompany postings, credit management, collections management, dispute resolution or cash management. There is also integrated planning and reporting based on the same single source of truth in real time. Predictive algorithms can be applied in real time to carry out what if analysis.
As Hilker concludes, “Central Finance can shorten the path to business transformation and allow the adoption of innovation with much fewer resources than usual “.
Martin Naraschewski and Carsten Hilker will both be speaking about SAP S/4HANA Finance at the SAP Insider Financials 2016 in Las Vegas – March 16th and 18th. Come and talk to them and other experts about the challenges and opportunities of SAP S/4HANA Finance in the digital economy.