In today’s interconnected world, unforeseen challenges are more prominent and expected than ever. The last two years, in particular, have demonstrated that digital resiliency is a business imperative for businesses of all sizes and across all industries. Organizations that are able to rapidly respond to and adapt to new situations tend to outperform their peers and the market and embrace unexpected challenges as opportunities. To achieve a greater level of resiliency, organizations must have complete transparency into the existing state of the business as well as continuously improve situational awareness to plan strategically for the future. This has placed greater importance on the office of the CFO (oCFO) to manage risk, deliver results, and plan more efficiently than ever.
This recent Q&A between IDC and SAP discusses the evolution of the CFO and the need for self-service capabilities of the tools and technologies that enable them to not only achieve a modern financial close but position their organization for long-term success with minimal to no dependence on IT.
Let’s dig deeper into what digital resiliency really means for your organization, how to achieve it, and how the office of Finance drives digital resiliency.
What is Digital Resiliency?
Although not a new concept, digital resilience gained momentum in 2020 with the rise of COVID19 and has quickly become a new digital transformation KPI. In fact, according to IDC, leading organizations are realizing that digital transformation depends on digital resilience to rapidly adapt to business disruptions by leveraging digital capabilities to restore business operations. Previously it was associated with concepts related to cybersecurity and online literacy, but today it has evolved to so much more, including the ways organizations leverage digital tools and systems to not only mitigate crises but capitalize on them.
Building digital resilience is more than just security and involves initiatives such as:
Improving agility to adapt to constantly changing market conditions
Applying enterprise-wide data and digital governance for a rapid response to disruptions
Elevating customer, employee, and partner experiences alike
Improving the speed and time-to-market for innovative applications
Unfortunately, organizations with legacy or disparate systems and tools find it difficult to achieve digital resilience and oftentimes incur hefty costs associated with their inability to navigate crises.
"76% of infrastructure and operations leaders experienced an incident during the past two years that required an IT disaster-recovery plan" - McKinsey
To overcome this obstacle and accelerate their digital resilience agenda, organizations must consider consolidating and migrating legacy applications to the cloud while collaborating with the office of finance as a strategic partner.
The Role of the Modern CFO
Although the oCFO has always been data-driven, modern CFOs are increasingly demanding access to more data and the ability to own and manage access to all the data sources they need to strategically plan for the future.
This makes sense as organizations that seek to transform finance require an abundance of data to identify the pain points and inefficiencies such as disjoined collaboration and manual data entry in existing processes.
For organizations who do not have a unified cloud data solution in place, making sense of and analyzing an abundance of diverse, distributed, and disconnected data is no easy task.
"50% of decision-makers are overwhelmed by the amount of data, while 44% do not have enough data to support decision-making." - IDC Report, How the Office of Finance Drives Digital Resiliency
Traditionally, CFOs have extracted data from disparate systems such as ERP and CRM for strategic planning. Unfortunately, this process is not effective or sustainable in the digital era. To plan and act with confidence, today's CFO needs to access real-time data in a centralized location to run sophisticated analyses including such as scenario planning, what-if, and scenario analysis to make smarter decisions.
More organizations are turning to all-in-one solutions like SAP Analytics Cloud, a unified cloud solution that brings together business functions and enables users to analyze, discover, forecast, and collaborate in real-time. In addition to business intelligence and collaborative enterprise planning, companies can benefit from leveraging:
Artificial intelligence, machine learning, and predictive and augmented capabilities embedded in SAP Analytics Cloud for a deeper analysis
Data warehouse cloud for seamless connection between multiple data sources and access to real-time data
Modern Profitability and Performance Management (PaPM) to execute complex calculations and perform high-speed profitability and cost analysis.
Align Strategically with oCFO to Accelerate Agility
To accelerate and get digital transformation right the first time, initiatives should be coordinated and implemented across the enterprise and the office of the CFO should be seen as the facilitator that bridges cross-functional gaps.
Discover how to supercharge your initiatives by downloading this SAP-sponsored report How the Office of Finance Drives Digital Resiliency. In the report you will learn:
The evolving role of the CFO and its position to meet the needs of a resilient business
Different types of data to leverage for business operations and insight
Ways the oCFO should think about transformation and modernization