In Part 1 of this blog series, we examined how digital transformation—the novel use of digital technology to solve traditional problems—can enable inherently new types of innovation and creativity as one positive benefit. For example, in the case of invoice and payment processing (AP) automation, positive results include financial gains, increased productivity, and freeing AP staff to come up with creative solutions and do more strategic work.
It can also spark fear, common in the face of major change. “This is how we have always done invoice processing,” or, “What will happen to my job if we automate?”
Today’s CFO plays a significant role in successfully managing both the process and the cultural changes that come with digital transformation. But in the case of implementing AP automation, many CFOs are passing the responsibility of automating the AP process to a controller, finance manager, or accountant. That staff member is tasked with defining the project, vetting providers, and choosing a solution. Sometimes, the only direction the CFO gives her is “does the solution work” and “does it fit our budget?” It’s an enormous pressure to have the task of revamping the company’s entire AP process on one’s shoulders.
In this situation, a decision might be made to just table the project because the person responsible is reluctant to move forward with the wrong decision. Or, the longer the process takes, the more time there is for doubt and fear of automation to outweigh the positive benefits that have been proven time and again.
In fact, when asked in a recent interview how AP automation is changing, and will expect to change in the future, Mark Brousseau, Institute of Finance Management (IOFM) spokesperson, consultant, and AP automation subject matter expert, responded, “CFOs will believe that if they optimize the AP process they can better manage cash, control spend, and mitigate risk. All helping drive larger corporate objectives.” This will put the CFO actively into the vetting and decision process (before), the implementation and training stage (during), and capitalizing on the benefits of automating (after). (S)he can also help mitigate the fears that come along with this type of change, considering both process and cultural shifts.
When the CFO is driving the digital transformation, they can then reassign work that is strategic and value-added to existing staff, and staff members will be free to explore creative solutions to workflow challenges.
In the face of this type of change, it doesn’t have to be scary, rather should be exciting! Imagine a scenario where, instead of continuing to ask, “How do we manage this ever-growing pile of invoices?” finance leaders will ask, “Where do we stand with working capital so we can more accurately forecast cash and manage budgets?” Further, “How do we better manage our supply chain?” Best of all, “What do we do with the cash that has been freed up?”
And your answer will be, “Develop new products and invest in R&D!”