What is a 'Transformative Finance Organization'? Why is it essential now?
Finance and Accounting are essential building blocks of growth
Getting the basics right is key for any organization that expects to unlock growth or profitability. By achieving industry best-in-class order-to-cash and/or procure-to-pay processes alone cannot deliver the competitive and structural advantages that companies need. Accounting coupled with strong FP&A, Functional Finance, Budgeting and Forecasting skills are keys to success. Some of the benefits of strong finance and accounting organization include:
Accuracy in inventory and demand and production planning
Proactive and accurate billing to facilitate faster collections minimizing deductions
Improved vendor relationships due to on-time payables
Rolling or flexible budgeting coupled with sound forecasting to help course correct
Coherence of financial performance and targets across the organization
The winning traits of the ‘Transformative Finance Organization’
A detailed assessment of your finance and accounting organizational skills sets is essential to identify structural gaps. Some of these skills sets can be bridged by existing workforce but some must be hired. Some of the enabling skillsets include:
Focus on accuracy of accounting transactions and financial reporting
Solid understanding of balance sheet and income statements
Knowledge of strategic pricing and external market dynamics
Understand and calculate operational variances, root causes and KPIs
Experience with multi-variable forecasting and scenario planning
Functional influencing and leadership
Executive-level communication skills using data and insights
Best-in-class organizations build Corporate Finance and Corporate Accounting functions
‘Transformative Finance Organization’ structure better meets the changing business needs. Large Fortune 100 companies structure their finance teams to facilitate growth and profitability. There is a clear distinction between corporate accounting and corporate finance to achieve accuracy and the depth insights.
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