Home' A Plus Magazine : January 2017 Contents aplus
98 percent of CFOs
said they were
involved in business
participated as a key
person in developing
to a Deloitte report
How the latest technologies will
transform business and finance
Blockchain, the technology that underpins bitcoin,
allows data to be exchanged through a publicly
immutable ledger of transaction, as a shared
network of computers around the world verifies
it. This technology could fundamentally change
the role of the finance function in areas such as
corporate reporting, where it could transform
the speed of reporting and theoretically allow
transactions to be recorded and logged in real
time, helping to improve transparency and trust in
Retailers like the The Co-operative in
the United Kingdom are trialling blockchain
technology on fresh food products in their
supermarkets, tracking food from the source to
ensure its authenticity.
Blockchain is a potential game changer to
the financial services industry, too. Financial
institutions such as Goldman Sachs, Morgan
Stanley, Aviva, Shroders and others are all
investing in blockchain for certain services. The
technology would give a product a digital identity,
removing humans from the checking process, and
permitting banks to verify transactions in real
time without further checks.
Robotics process automation has been
gaining momentum, and can reduce the need
for people to perform back-office processes.
Robotics has major implications for how finance
functions perform repetitive, transactional
processes. It will also overhaul the training
ground for junior finance professionals, and
impact recruitment needs.
KPMG in the United Kingdom has
already begun using IBM’s Watson cognitive
computing technology for some of its services.
The Big Four firm has built a cognitive engine
called Astrus using IBM Watson technology,
which can conduct due diligence on issues such
as new suppliers or merger and acquisition targets
for clients in minutes, a task where the whole
teams of people used to take weeks to complete.
Deloitte U.K . is using robots in its Milton
Keynes-based shared service centre to do
management reports, which helps to slash costs.
Deloitte reckons using a robot costs a ninth of
the cost of a U.K .- based accountant and a third
of the cost of recruiting an accountant in an
the organization to form a holistic view.
They also need to understand that there
will have to be a culture change too.
And while some companies’ digital
journey will travel from zero to one; for
some business models it will require an
overhaul, so I think the board needs to be
ready for a culture change,” says Chou
Fong at HKUST is in the process of
automating all systems and processes for
the university. He began two years ago
and estimates the whole process will take
around five years in total. Fong is only too
aware that digitization is as much about
culture change as it is about digital tools.
“It’s an education process for people, and
sometimes people are resistant to change.
The more automation you want to do, the
more time you have to spend explaining the
process to people,” Fong says.
Ahead of the game
Certain sectors are more advanced
than others in the adoption of digital
technologies. This trend can be found
across geographies too. Highly regulated
industries such as financial services,
pharmaceuticals and the utilities sectors
are well advanced in their adoption of
automation and digital technologies such
as artificial intelligence and blockchain.
Sectors with narrow margins and
constant cost pressure are also at the
forefront, as well as retail and consumer
products. Government and the public sector
are currently looking at ways to leverage
these technologies to better serve people.
Digitization comes with its own pitfalls.
On one hand, it offers organizations the
opportunity for new business models and
revenue streams. But on the other hand,
digitization can make organizations
susceptible to disruption from new
players and agile incumbents, and creates
exposure to new risks.
And of course, all manner of cyber
threats are on the rise. Barely a week goes
by without news of a major global organiza-
tion – private and public – being hit by cyber
attacks. As part of risk assessment, CFOs
must work with the CIO to establish a gov-
ernance framework for quantifying digital
risks, prioritizing and protecting digital
assets, and mediating across silos to create
an integrated approach.
As Chou points out, there are no
guarantees once an organization has
undergone digital transformation that it
will be a success. But, he says, at least
organizations will then be agile enough for
the challenges ahead.
“Companies need to be ready to
change quickly,” Chou says.
January 2017 13
Links Archive December 2016 February 2017 Navigation Previous Page Next Page