Financial technology, or FinTech, is changing the way finance and accounting departments interact with and support wider business functions and operational success. Financial process automation is one such technology that can have an incredible impact on financial efficiency and operational resilience in modern businesses. According to a report from Accenture, 80% of financial processes have the potential to be automated. But understanding the technology behind financial automation and utilising it effectively can be a challenge for CFOs and Finance Directors looking to harness its advantages.  

4 key business benefits of automating financial processes 

Financial process automation refers to the use of technology to streamline and automate repetitive, manual tasks in finance operations to improve efficiency, accuracy, and speed. Many types of financial processes can be automated. From core processes like accounts payable, invoicing, payroll and accounts receivable, to more high-level processes such as budgeting, forecasting, and financial analysis, and compliance reporting.  

Automating your financial processes can have wide-ranging operational benefits. For example: 

1. Improved accuracy 

Automating processes can reduce the number of manual errors in financial reporting, making forecasts, budgets, and accounting more accurate. Accurate financial data can make businesses more agile and improve decision making through data insights

2. Increased visibility and control  

The accurate real-time monitoring and reporting produced through financial process automation can provide you with better risk management through increased visibility and control.

3. Cost savings  

Automating many financial processes tasks reduces the number of staff required. This can lead to a reduction in staffing expenses allowing you to allocate your resources in more strategically. Improved accuracy further reduces the costs associated with rework and rectifying mistakes.  

4. Improved operational efficiency 

Increased processing speed and accuracy improves the overall efficiency of your financial departments. Freeing team members from the burden of repetitive administration and data entry allows them to focus their time and energy on more productive, value-adding and business critical tasks.

How to choose the right financial automation solution for you 

Around 70% of finance teams re-evaluated their finance processes in 2022, but getting the most from automating financial processes can be a challenge for Finance Directors and CFOs looking to improve efficiency, accuracy, and cost savings. To get the most from an automation solution it's important to develop an automation strategy that takes into account: 

  • Your organisation's needs and goals 

Digital and automation transformations are a journey. The first step in any financial process automation should be a thorough assessment of what you want the automation to achieve both in the short and long term. 
If your end goal is reduced staffing costs, you should be asking yourself which processes do your teams spend the most time on. Or, if your goal is to reduce complexity you should identify common processes and functions that repeat within your organisation. 
It's important that you outline your objectives and ensure that any proposed automation changes will deliver results and meet your goals.

Any potential financial automation solutions:

  • Scalability  

If your business is looking to grow, it's important that your financial process automation can scale with you. Automating your finance processes can have a big impact on the success of operational scalability, so look for systems and tools that empower your teams to be more strategic and that removes finance as a bottleneck to growth.

  • Ability to integrate with existing systems 

Using automation tools which integrate with each other and with your existing systems should be a priority. Look for solutions that can integrate well with different ERPs and third-party tools. Cloud-based solutions can be cost-effective and reliable.

  • User-friendliness 

Any automation solution should reduce costs, not add to them. Complex automations can require increased tech support, training and even reduce accuracy. Look for easy to use, intuitive solutions.

  • Security and data privacy 

Automating financial processes can improve overall security by reducing access to sensitive data and improving the time taken to detect security breaches. However, automation solutions could be vulnerable to risk if best practice is not followed.  

Research any automation solution's security features, its ability to integrate with existing security and compliance tools and the auditability of the processes.

Potential implementation challenges and risks 

Whatever financial process automation solution you choose, there may be challenges to a successful implementation. Obstacles to consider include: 

  • Staff resistance 
  • Implementation costs 
  • Scope creep 
  • Data quality and accuracy 
  • Lack of skills available to implement and manage automations 

Ensure the successful implementation of a financial automation solution and mitigate risk by carefully considering the costs of automation, the time to implement your solution, and engaging in proper strategic planning. 

New technologies, like machine learning and AI, make the future of financial automation bright with even greater benefits and advantages available to enterprising CFOs and Finance Directors. We are beginning to see the potential of automation processes that can learn and improve based on the data it uses. Perhaps even automation systems that can grow, adapt and expand to meet the unique requirements of your business.  

Finance automation processes can change the game when it comes to improving the efficiency and accuracy of your finance departments and their ability to support decision making through data driven insights.  

Looking for interim financial services manager to oversee your financial automation implementation?

Oakwood Resources' unique approach makes hiring easy. Our bench of experienced interim managers mean we can source individuals with the skills you need when you need them. And you can rest assured that they will have all the required compliance and reference checks as well as being hand-picked for cultural fit.  

Build a lasting partnership with an interim recruiter who blends specialist interim management expertise with the strategic framework of a consultancy for agile, bespoke project solutions that yield results. 

Learn more about our Blended Model or contact a consultant today.