Digital Leaders in Finance Operate at 44
Percent Lower Cost, Rely on 45 Percent Fewer Staff
Finance must rise to the challenge of today’s volatile global
markets and become a more effective strategic partner to senior
management, according to new research from The Hackett Group, Inc.
(NASDAQ: HCKT). The research found that finance is using digital
transformation to help it excel in three key areas: running an
efficient operation, delivering effective services and improving
its customers’ experience.
Broader adoption of digital technologies is already helping some
finance organizations achieve all three objectives, the research
found. Digital leaders, or finance functions that ranked “high” on
a scorecard of technology metrics, operate at 44 percent lower cost
than their peers and employ 45 percent fewer staff. They experience
error rates that are 37 percent lower and spend 19 percent less
time collecting and compiling data.
A public version of the research, “The Three Hallmarks of a
World-Class Finance Organization,” is available on a complimentary
basis, with registration, at this link:
http://go.poweredbyhackett.com/wcfin1806sm.
“Digital transformation is an important contributor to achieving
world-class levels of efficiency and effectiveness,” said Nilly
Essaides, senior research director, The Hackett Group. “But to
realize the full benefit, finance needs to more broadly adopt
technologies such as new data-management tools, self-service
analytics and RPA, which enable finance to improve processes and
optimize its service delivery model.”
“Automating broken processes will not fix long cycle times or
high error rates, for example, and implementing an advanced
analytics solution will not produce better insight if finance
doesn’t have the skills to use it or the data to feed it,” Essaides
said.
World-class finance organizations operate at much lower cost and
employ fewer staff. They achieve these results in part by making
investments in people, adopting new technologies, optimizing
processes and shifting more finance activities into global business
services organizations (GBS) and centers of excellence (COEs).
World-class finance organizations have doubled their investment
in training over the past year and on average offer 60 percent more
training hours than peers. Process owners have a clear view of
processes from end to end. World-class finance organizations also
improved effectiveness by standardizing and consolidating their
data management platforms, which enables them to produce more
insightful reports.
Through standardization, automation and process redesign,
world-class finance organizations have significantly reduced the
time staff spends on low-value work, the research found. For
example, financial analysts at world-class finance organizations
spend 19 percent less time collecting and compiling data, and that
much more time analyzing it. They are also more than 40 percent
more likely to use both financial and non-financial performance
measures in their analyses, putting them in a better position to
understand how business decisions affect financial performance.
At the same time, world-class finance organizations also see
much higher levels of customer satisfaction. They are more than 3x
more likely to be perceived by stakeholders as anticipating and
responding to their business needs.
An important driver of higher customer satisfaction at
world-class finance is the quality of the analyses finance provides
to management. World-class finance organizations not only spend
more time on analysis but also are also more likely to include
what-if scenario analyses when creating strategic plans, leading to
greater accuracy and higher chances of meeting organizational
strategic objectives.
“Finance’s mandate from senior management and top business
leaders is clear: Support strategic decision-making by delivering
better information; assist with the enterprise digital
transformation strategy; and collaborate more effectively with
business leaders,” said Jim O’Connor, global practice leader,
Global Business Services and Finance Advisory Programs, The Hackett
Group.
Another important driver of customer satisfaction is the
seamlessness of the process. World-class organizations make 6x
fewer mistakes than peers in accounts payable and 3x fewer errors
in customer billing. These improvements help reduce unnecessary
disputes with external customers and enhance relationships with
strategic partners. Errors in these and other internal processes
can color the perception of internal stakeholders.
“To achieve their goals, finance organizations must reduce their
cost of operations, increase efficiency so staff can focus more on
strategic activities and emphasize their customer and stakeholder
experience,” said O’Connor. “One leading telecom firm digitally
enabled its T&E process via a cloud-based application that
employees can access using both desktop and mobile devices. As a
result, finance experienced significant customer satisfaction
improvement, faster cycle times, and 30 percent capacity
improvement.”
“Digital transformation can play a major role in helping finance
organizations achieve all this. It can also help peer organizations
catch up to their world-class competitors. But the definition of
world-class finance is continuing to evolve, and these top
performers are continuing to raise the bar in terms of the value
they can bring to the enterprise,” O’Connor said
World-class finance organizations are those that achieve
top-quartile performance in both efficiency and effectiveness
across an array of weighted metrics in The Hackett Group’s
comprehensive finance benchmark. The Hackett Group’s world-class
finance research is based on an analysis of results from recent
benchmarks, performance studies, and advisory and transformation
engagements at hundreds of large global companies. A public version
of this research, is available on a complimentary basis, with
registration, at this link:
http://go.poweredbyhackett.com/wcfin1806sm.
About The Hackett Group
The Hackett Group (NASDAQ: HCKT) is an intellectual
property-based strategic consultancy and leading enterprise
benchmarking and best practices digital transformation firm to
global companies, offering digital transformation including robotic
process automation and enterprise cloud application implementation.
Services include business transformation, enterprise
analytics, working capital management and global
business services. The Hackett Group also provides dedicated
expertise in business strategy, operations, finance, human capital
management, strategic sourcing, procurement and information
technology, including its award-winning Oracle and SAP
practices.
The Hackett Group has completed more than 15,000 benchmarking
studies with major corporations and government agencies, including
97% of the Dow Jones Industrials, 89% of the Fortune 100, 87% of
the DAX 30 and 59% of the FTSE 100. These studies drive its Best
Practice Intelligence Center™ which includes the firm's
benchmarking metrics, best practices repository and best practice
configuration guides and process flows, which enable
The Hackett Group’s clients and partners to achieve world-class
performance.
More information on The Hackett Group is available at:
www.thehackettgroup.com, info@thehackettgroup.com, or by
calling (770) 225-3600.
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version on businesswire.com: https://www.businesswire.com/news/home/20180920005515/en/
The Hackett Group, Inc.Gary Baker, 917-796-2391Global
Communications Directorgbaker@thehackettgroup.com
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