Libro de admionistración

1. Co-Pilot of the Business
Finance is the
New Guidance System

2. Executive Summary
What can today’s business environment teach us about the
future of the finance function?
As new digital technologies burst onto the scene, the
finance role is evolving at an ever more rapid pace. Finance
has traditionally been about control, compliance and
reporting. But in today’s ever-changing economy—where
cloud, mobile, social, and analytics are spawning new
business models almost overnight—finance leaders face
ever-greater expectations. Traditional accounting skills are
seen as merely the cost of entry for a finance director or
chief financial officer.
The stakes are higher than you may think. Accounting
and auditing functions are among the most likely to be
automated by computers in the near future, according to
research from MIT, Oxford University, and other institutions.
If finance teams don’t take the lead in broadening their role,
they risk being sidelined by other business units and losing
their place at the strategy table.
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As the business world shifts under the pressures of digital
technologies and global markets, finance leaders must
move from governance to guidance. One Oracle customer
described finance as “the new guidance system” for the
enterprise. To provide this guidance, finance teams should
embrace three principles:
• Finance teams should be digital leaders
• Data is the new currency
• Finance should connect the enterprise
This paper will explore each of the above principles, and
provide recommendations on how to modernize your
finance organization in order to become a true co-pilot of
the business.

3. Finance Teams Should be
Digital Leaders
CFOs have always been the stewards of corporate
value. Their financial acumen and understanding of
how enterprises are valued give them the expertise
to comprehend the long-term implications of different
business models and investments.
Yet in the digital age, CFOs know that business is
anything but usual. When companies like Uber and
Airbnb suddenly emerge to dramatically disrupt mature
industries, every company should be wondering if its
sector is next.
Even if your business hasn’t felt the heat of a disruptive
concept, the amazing success of native-digital companies
is changing the way all companies are being valued.
Tangible assets such as property and equipment are given
much less weight. Instead, shareholders are increasingly
placing their investment bets on business models that
are enabled or extended by digital technologies, while
valuations are rising on intangible assets such as brand
reputation and intellectual capital.
Companies in multiple industries are responding to this
change. A global manufacturer of jet engines, for example,
is making significant shifts in its business model to create
meaningful value outside of the manufacturing plant.
Along with a jet engine, this company’s clients can now
buy a range of digital services to help get the most value
from their purchases.
We see this in the automotive sector too, with more and
more companies exploring connected-car strategies.
The goal isn’t simply to gather information about a car’s
performance; automakers are striving to grow revenue by
creating a better experience for the customer.
In order to introduce these new business models,
digital technologies must be embedded throughout
the business—even (or perhaps, especially) in the
finance function.
The need to modernize is not new to finance
professionals. Back in the 1980s and 90s, finance
departments were leaders in adopting new technologies.
They were the first to automate with enterprise resource
planning (ERP) software, as well as the first to adopt
analytics and enterprise performance management
(EPM). What happened to this leadership position?
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Unfortunately, the very tools that once made finance
more efficient are now an impediment. The systems
installed back in those days are inflexible, heavily
customized, and painful to upgrade. Many finance
teams are working with technology that predates the
Worldwide Web, and were simply not designed for
operating in an internet-enabled world—let alone a
digital one.
It’s time for finance to take the lead once again.
Business leaders have grown accustomed to thinking
of “digital” as tools for marketing, sales or service; yet
few stop to consider that digitizing finance functions—
such as ordering, billing and fulfillment—can offer
straight-through processing to dramatically improve
customer satisfaction.
The impact of digital technologies can be even greater
in the back office than in customer-facing functions;
automation and efficiencies can increase by as much
as 35 percent. For example, mobile access to finance
systems allows busy executives to be productive
on the go; while access to advanced analytics and
visualization tools provide the critical data required to
make informed business decisions.
Whether you are a global player or a smaller company,
investments in digital finance capabilities are material
and will have a big impact on future margins and
business valuations. Every CFO must play a strategic
role in guiding digital transformation, in order to take on
the role of business co-pilot.
In the finance area, we were able to cut expenses by
12 percent…because we have the controls in place,
with proper approvals for spending. We were able
to reduce about 2,000 man-hours because we’re
not duplicating efforts trying to enter information into
multiple systems.”
“
Kimberly Leeper
Controller, CyraCom International Incorporated
(“Oracle ERP Cloud Translates to Big Savings at
CyraCom,” Oracle, 2015)

4. Data is the New Currency
Finance helps the business say it with numbers.
Because finance professionals are trained to be analytical
and skeptical, they are ideally positioned to drive a
data-driven culture throughout the enterprise. The CFO’s
office has always had credence as being a source of truth.
Today’s flood of data is the perfect opportunity to extend
that credibility to other statistical analyses and more
data sources.
Increasingly, companies are using the value-creating
power of data insight to launch new products, services
and business models. In fact, some would say that
data is the new currency—or at least, a new form of
high-potential capital.
Investors have taken notice and are rewarding data-driven
initiatives, because such insight can increase positive
outcomes across the enterprise. Data has become at
least as important to modern commerce as cash assets,
inventories, facilities and intellectual property; in some
business models, it’s the only form of capital.
Wherever your company falls on this spectrum, you can
be sure the data within your enterprise is valuable. It’s
also quite likely that you’re losing some measure of that
value by not optimizing your data.
According to an Oracle survey of 742 executives
conducted in collaboration with WSJ. Custom Studios,
nine out of 10 executives consider the ability to garner
insight from data vital to their company’s future. Yet, more
than half have serious doubts about their organization’s
ability to manage significant data inflows. On average, the
surveyed companies are losing an estimated 16 percent in
revenue annually, and close to one-fifth of the respondents
estimate their revenue loss at more than 20 percent.
Who takes charge to make sure a company’s data is
being used as effectively as possible to support
high-level strategy?
CFOs and other finance leaders seem like the logical
choice to fill this role, because they have:
• A high-level view of the extended enterprise, from
supplier management to fulfillment and across functions
internally
• A quantitative mindset with experience in analyzing data
• Business training and acumen with the ability to see
new opportunities that others might not
In addition to the above skills, companies that want to
optimize data for value creation need the right technology
in place. Executives participating in the WSJ. Custom
Studios survey noted that, with their existing tools,
business managers must rely heavily on IT to access,
compile and analyze data—which in turn leads to a lack of
timely information.
Companies should consider adopting new predictive
planning and analytics tools, including visualization
technology, to quickly identify important signals within
the data. Cloud-based models make it easier and more
cost-efficient to roll out these tools to a wider group of
people across the organization. Instead of mapping where
the business has been, modern finance professionals
can lead the way in identifying new paths to further the
organization’s strategic goals.
Finally, there are “soft skills” that finance leaders should
develop in order to build a data-driven culture. Much of
today’s key data—especially when it comes to customer
satisfaction—comes from marketing, sales, service,
and other areas outside the CFO’s office. Finance
professionals must learn to motivate, mobilize and
guide collaboration among these disparate teams. The
goal should be to instill an analytic culture within all
departments, to drive business decisions based on facts,
not intuition. This is where finance has the opportunity to
truly connect and guide the business.
4
Oracle Planning and Budgeting Cloud Service is the
gold standard of cloud-based planning solutions. We
wanted a rapidly deployable system to improve our
planning systems and forecasting accuracy during a
period of ambitious global expansion.”
“
Elaine McKechnie
Head of Group Management Information Systems,
Baxters Food Group
(“Baxters Food Group Drives Efficiency in Expanding
Food Manufacturing Business with Improved
Forecasting, Planning, and Budgeting,” Oracle, 2015)

5. 5
Finance Connects
the Enterprise
When top-notch math skills and financial knowledge are
described as “only the tip of the iceberg when it comes
to excelling as a financial professional,” it’s fairly obvious
that finance’s role is changing. To get ahead as a finance
professional today, opportunities come to those who
demonstrate strong communication skills, relationship-
management expertise, and problem-solving capabilities,
to name a few.
As finance teams play a larger role in connecting the
enterprise, CFOs can focus more of their attention on
investment in growth, seeking opportunities to boost
business transformation, and building and measuring new
sources of value.
Respondents to a recent survey by CGMA® (Chartered
Global Management Accountant) confirm that CFOs
are already playing a larger role in most areas of the
business. CFOs retain primary responsibility for financial
planning and analysis, risk management, and shared
service centers. In addition, they are ranked second as
the people primarily responsible for strategy, supply chain,
information technology and digital transformation.
Yet finance lags behind other departments in providing
key performance indicators to the business—especially in
the areas that investors are rewarding, such as customer
retention, satisfaction, and brand reputation. These key
metrics are most often reported upon by marketing and
sales teams (Figure 1), giving those lines of business
increased prominence within the organization.
Key performance indicators and the functional departments that provide them
(The Digital Finance Imperative: Measure and Manage What Matters Next, ©CGMA, reprinted by permission)
Figure 1

6. At a time when traditional accounting functions are at
high risk of automation, finance teams cannot afford
to cede their influence to other departments. Instead,
they should collaborate more closely with other teams,
providing them with the reporting and analysis they need
in order to do their jobs more effectively.
LinkedIn offers a great example of how finance teams are
working with the business. “Our approach to business
partnering has evolved,” said Richard Wong, vice
president of finance, LinkedIn, USA, in the CGMA report.
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“We take time to understand the business and problem;
have a point of view on all matters and issues; and provide
value-added analytics to drive the right outcomes and bring
clarity to all the (massive big data) noise out there.
“Finance is sometimes the first line of defense for these
business units,” Wong said, “to flag any risks and ensure
that each business unit is contributing to the company’s
growth and vision as a whole.”

7. 7
Recommendations
Of course, asking finance professionals to become digital
leaders, drive a data-driven culture, and provide more
support to business units begs the question: Where do
they find the time?
The problem is that most finance teams are still saddled
with manual reporting and control processes. If your
finance team is spending all their time pulling data into
spreadsheets from multiple sources, assembling reports,
or checking transactions for control violations, there is very
little time left for them to think about business strategy.
The finance executives we see as true co-pilots for
the business—meaning that they’re sitting side-by-
side with the CEO to guide the enterprise toward new
opportunities—are investing in digital technologies that
automatically flag control exceptions, provide real-time
dashboards for reporting and forecasting, offer access
to mobile, on-the-go finance systems, and speed up
collaboration and workflow through modern social tools.
With these enabling technologies, CFOs are delivering
substantially more value than ever before.
The time savings that efficient finance tools can provide
are dramatic—for example, procure-to-pay solutions can
automate the processing of a vendor invoice, saving the
27 hours (on average) that it takes to complete the task
manually. Companies can all but eliminate delays between
transaction processing and multidimensional analysis;
harness zero-based budgeting to reduce SG&A costs by
10 to 25 percent; and more easily spin up new businesses
and spin off defunct ones.
With increased levels of automation, modern finance
teams are looking more like investment banks, using
data and algorithms to predict business opportunities.
These teams can help the business identify future sources
of growth, revenue and margin, and then develop the
budget, strategies and capital allocation plans to achieve
their goals.
With the new, digital models enabled by subscription-
based cloud finance services—including ERP and EPM
cloud—achieving this level of automation is within the
grasp of companies of any size.

8. When you look at the ranks of Fortune 500 CFOs,
only a minority—27 percent—have public accounting
backgrounds. The skills and talents that CEOs and boards
are looking for in a finance leader are changing. What got
you into your current position won’t be enough to get you to
your next one.
Oracle CEO Safra Catz, in her keynote address at the
inaugural Modern Finance Experience, spoke about how
the finance role continues to evolve with more automation.
“We used to spend all of our time looking backwards,
reporting on what happened,” Catz said. “Now it’s about
looking into the future. It’s about planning and integration.
The role of finance is now that of a partner in the business.”
Conclusion
For additional reading, download the CGMA report,
“The Digital Finance Imperative: Measure and Manage
What Matters Next.”
Finance leaders should not wait for other business units to
decide their fate. Wherever automation is possible, it will
eventually happen, so finance teams must lead the change
rather than resist it. Embrace automation now, invest in
the technologies required to free your teams from manual
reporting and processes, and use that newfound freedom
to refashion your department’s role to become a true
co-pilot of the business.
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