As Treasury Goes Virtual, Can Forecasting Keep Up?

money-forecastingAs businesses continue to expand their global footprint, and new technology changes the way we work, the success of the treasury department is contingent on how well it operates in an increasingly virtual setting.

That’s the latest from PwC’s Global Corporate Treasury Benchmarking Survey 2017, which captures the views of over 220 treasurers and Chief Financial Officers (CFOs) from around the world.

With a full two-thirds of people involved in treasury processes are no longer reporting directly —or even indirectly—to the treasurer, the function is no longer a “department” but rather a process. In fact, many treasurers are handing over more treasury tasks to third-party providers or internal shared services.

In a statement, Sebastian di Paola, Global Corporate Treasury Leader at PwC, said, “Treasury is becoming increasingly virtual and treasurers need to be jacks of all trades by collaborating more with the business, shared services and banks and raising their game in IT security, valuation and financial risk management.”

Top of the Agenda

The solution, says di Paolo, is a strategy that takes a consultative approach, integrates other business processes and is heavy on automation. Treasurers are being asked to step up and become stewards of liquidity and better cash flow management.

A top priority for both CFOs and treasurers is cash flow forecasting, with 42% ranking it as a priority and 80% of these people rank it as high or of critical importance.

Yet, as the report points out, forecasting has been ranked as a priority for the past two decades, and in the 2017 report, over half of respondents cite concerns like accuracy of data, data collection, mapping and proper tooling. Despite huge technological advances, treasury is still a manual, spreadsheet based function. Plus ça change, plus c’est la même chose, it seems.

For treasurers to truly attain better cash flow forecasting and reporting, they must first embrace digitalization, process transformation and predictive analytics. The report points to the importance of attaching KPIs to data accuracy. (Be sure to download the full report here.)

Our Experience

Sutherland has helped many clients contain costs and improve cash management. Finance executives know what has to be done, but internal teams have limited resources for overcoming the obstacles of a lack of centralization and visibility. They struggle with getting real-time information and actionable data.

Optimizing cash management is essential to business success. If you’d like more information on how Sutherland can help you improve cash flow management and significantly reduce your costs, please schedule an appointment today for a deeper conversation with one of our experts.

transformation-roadmap

The F&A Experience

When you see a football player effortlessly pluck the ball out of the air, and in one single move, change the game completely, you understand that days, weeks and years of practice went into the automatic reflect behind that play. When online shopping channels make it easy to purchase (and check out) with the single click of a button, there’s no doubt that thousands of hours of design thinking and GUI coding expertise went into that seamless experience.

It takes a lot of effort to for anything to appear effortless.

The ongoing march of technology, and the intersection of multiple technologies—combined with human ingenuity—make many of these experiences possible.

But how often is the F&A experience considered?

When it comes to partnering with clients, there are two outcomes that should be considered:

  1. How can we improve the client’s employees experience with their own processes and practices?
  2. How can we favorably impact our client’s customers’ experiences?

Inevitably the two are interconnected. Continue reading

The Art & Science of Data-Driven Finance

office-sceneYesterday, Sutherland’s Jon Sunthimer, Vice President, F&A Global Technology Leader, co-hosted a webinar with Veena Gundavelli, the Founder and CEO of Emagia Corporation. The topic? Data-driven finance.

More than ever, finance organizations need to eliminate data silos, turn data into insights (and decisions), and digitalize and automate the Order-to-Cash (O2C) cycle. Finance executives are under increasing pressure to improve performance, with key drivers for finance transformation boiled down to the “4Cs”:

  • Cost
  • Control
  • Compliance
  • Cash flow

After an introduction by Ms. Gundavelli, Mr. Sunthimer pointed out that transformative is imperative. Digital technology isn’t limited to the domain of high-tech companies. Today, every company is a digital company, and those that aren’t have a limited shelf life.

Mr. Sunthimer elaborated on how today’s hot commodity is data. Companies sit on massive amounts of structured and unstructured data, and there is a strong desire to turn that mound into usable, actionable knowledge. Continue reading

The Future of Financial Reporting

reportingCFOs and financial controllers are feeling increasingly vulnerable as they struggle to produce forward-looking insights amidst ever-changing regulatory environment and ever-growing amounts of information.

According to a new report, “How Can Reporting Catch up With an Accelerating World?”, released in October from EY, 66 percent of respondents say the increasing volume and pace of data is significantly impacting the effectiveness of reporting. That’s up from 57 percent in 2015. The annual global report polls 1,000 CFOs or heads of reporting of large organizations across 25 countries.

Increased Complexity

These financial professionals noted that in 2016 the organizational environment intensified in complexity, as organizations added more legal entities, business units and reporting systems. A full 64 percent reported a surge in the number of reports requested by shareholders. Yet the survey goes on to say that reporting teams don’t have access to the technology or tools needed to make sense of —and actionable decisions on— vast oceans of incoming data. Continue reading

From Data to Insight to Action

business objectivesIn today’s ever-changing business environment, senior executives are expecting more from the F&A department than reports and financial statements. They now want to see how finance can bring greater value to the table in the form of forward-looking insights.

So Much Data, So Little Time

Companies are flooded in data. Most of it compartmentalized in organizational functions and verticals, from customer data locked up in CRMs to inventory stored away in ERP systems. In today’s world, amassing data isn’t good enough; it’s all about getting the insights needed to make smarter decisions faster.

From anticipating changes in the marketplace to deflating ballooning operational costs, strategy analytics can play a strong role in increasing a company’s competitive edge. Pulling in both historical and current information, analytics can be used to understand the overall performance of the organization, improve processes and solve business challenges. Continue reading

No More Crystal Balls: The Science of Cash Forecasting

money-forecastingCash forecasting is probably one of the most important tools for financial management. With global uncertainty, especially in light of the Brexit fallout, the ability to better manage and predict cash flow is garnering strong interest from organizations around the world.

Accurate cash forecasting can be critical to survival. It’s much more than just a prediction – it informs major business decisions for both internal and external stakeholders. If hedges are not on the mark, a company may be forced to borrow or dip into expensive overdrafts.

Yet many companies struggle to accurately forecast cash flow. Chief among the issues they grapple with are:

  • No Centralization: A lack of standard processes and systems limits visibility into the timing of cash flows. Having a centralized model yields better cash and working capital management. It also makes it easier to manage liquidity and funding risk.
  • Multiple ERPs: With disparate, unconnected systems, finance teams face major obstacles to finding and verifying data.
  • A Preference for Spreadsheets: Left to their own devices, forecasting staff often use Excel spreadsheets. This results in information siloed away on desktops or errors caused by manual entry. It’s not uncommon to uncover treasury departments with 50+ distinct spreadsheets.

Continue reading

How to Improve Hotel Investor Satisfaction

600px-shutterstock_158174519Knowledge is power. And, the ability to get an instant gauge on the fiscal health of a hotel portfolio or brand, as well as the knowledge needed to make a new acquisition or divestiture is even more powerful. Investors —and other key stakeholders—want to know how their assets are performing with access to accurate statements and reports as well as KPI dashboards from anytime or any location.

Enhanced financial reporting transforms data into actions for investors, giving them greater insight into risks, opportunities and value creation potential. Better quality reporting, delivered rapidly, also engenders better relationships and increased investor satisfaction.

Step 1: Get Over the Hurdles

Finance reporting places a pressure on the management and delivery mechanisms used by hotel management organizations. Consolidated, standard reports (and ad hoc reports) tailored to each hotel brand or portfolio owner can be a challenge to produce in a timely and encompassing manner. Continue reading

Reporting on Hospitality: BPO for a Better Grade

hospitalityIn the hotel industry, growth is a top priority. Efficient operations and first-rate customer service are crucial to business success. Yet for hotels using an asset-light strategy — a franchise model or long term property management contract— it can be a significant challenge to deliver the comprehensive reporting required for optimal performance and consumer satisfaction.

Front office workers rely on customer relationship applications, while back office staff use ERP applications and workflow tools. As a result, customer, vendor and financial data are isolated within each location, leaving hotel organizations with next to no shared information or transparency.

Pulling metrics like occupancy rates, cancellation rates, ADR and RevPAR are all key to keeping a pulse on the business. Yet, multiple, incongruent systems and non-standard reporting practices make it difficult to draw insights about the overall brand and property performance— and nearly impossible to make mission-critical business decisions. Continue reading

Critical Follow The Sun Reporting

reportingFor large enterprises with multiple divisions, spread across a number of geographic locations, there’s a high probability that Finance Planning & Analysis (FP&A) data exists in silos. It’s an overwhelming challenge to get people, systems and data all on the same page. The planning and analyst people who are paid to glean insights and provide decision-making reports instead spend tremendous amounts of time trying to understand data and reports that don’t align because the data didn’t match up.

A Case in Point

Our client, a global Fortune 500 software company, was facing some key challenges typical to organizations around the world:

Global Updates Needed In a Siloed Environment: The data required constant refreshing to create different area reports. The client faced obstacles relating to time zones, siloed data due to discrete systems or locked away in offline applications, and a cumbersome data extraction process that only exacerbated the reporting inefficiencies. Continue reading

AMBO: Analyze & Maximize Business Objectives

business objectivesGathering and deriving valuable information and actionable insights from enormous amounts of data is a key challenge faced by companies the world over. The challenges stem from multiple disparate systems and applications that cannot “talk” to one another, resulting in siloed data. Often, the task of consolidating all the data required for standard and ad hoc reports is extremely difficult, and at the least, very time consuming.

The result is that finance staff members spend too much time gathering data and managing spreadsheets, and too little time providing value-added analysis and actionable reporting.

Then add into the mix version control issues, human error, unstable macros, broken formulas, security risks, the inability to collaborate across the enterprise and any number of other problems that undermine reporting, budgeting, forecasting and financial planning. Continue reading