Posted by Barney Beal(opens in new tab), Content Director, NetSuite
If you’re a CFO starting at a new business and don’t want to be called a bean counter make sure you prove your business partner worth to your colleagues. A key to achieving this is to leverage the cloud. It helps transform the CFO role from merely providing historical/backward-looking information to delivering forward-looking analyses of business threats and opportunities, according to Tom Kelly, Managing Director at T > Edward Inc., during a breakout session at last month’s SuiteWorld 2014.
Gone are the days when the finance department simply collected, paid and reported. However, while the main goal of CFOs today may be to evolve the finance function into a center of strategic value, it does not release the finance department from its day-to-day tactical duties, he added. Without flawless execution of core finance services (transactional, closing the books, etc.), many CFOs will find it difficult or impossible to gain the level of trust and confidence from the organization required to successfully undertake more value added and strategic activities. If you do not use the cloud to provide a framework to automate and execute day-to-day transactions and the financial close process, you may never achieve true “business partner” status, and thus be doomed to be called a bean counter the rest of your tenure, Kelly warned.
That was just one of the key takeaways from Kelly’s session, where he shared insights from his experience at T > Edward, a strategic and operational SaaS consultancy, providing cloud expertise and services to Fortune 500 and private equity-backed companies where Kelly has plenty of experience working with cloud ERP systems as a CFO and CIO.
For example, he suggested an ongoing 24-7-365 financial close process(opens in new tab), an idea that was met with (one can assume skeptical) silence from the audience. Embracing the fact that NetSuite is a real-time system and the mindset that the close process is a 24/7/365 thing, many T > Edward clients have oriented themselves to addressing the key data that not only expedites the closing process, but also as important, provides key stakeholders with accurate, timely and in some cases real-time data.
This was just one of the many examples Kelly used to explain how cloud computing, and NetSuite in particular, can transform the role of the CFO.
For companies launching NetSuite for the first time, Kelly had some advice that might sound familiar. Keep it simple.
“When I do go into an organization, I try to convince them to stay with out-of-the-box NetSuite,” he said. ”The more you can leverage out of the box, the easier it is to implement, the easier it is to close the books.”
The flexibility of NetSuite also offers the opportunity for some creative problem solving, Kelly suggested. At one organization he worked with, the head of accounts payable(opens in new tab) was also known as the Czar of March Madness.
That’s because she’d created a specialized dashboard that could be put into the NetSuite home page and provide users with up-to-the-minute scores from the NCAA basketball tournament, so they didn’t waste time surfing the Internet for updates. In fact, NetSuite provides lots of role-based dashboards that help keep personnel focused on the work that needs to get done, Kelly noted.
“She runs the most efficient office pool in the world. Take that Challenger, Gray and Christmas,” Kelly said, referencing an oft-cited study that suggested the NCAA tournament costs employers $1.2 billion(opens in new tab) each year in lost productivity.
Another example of the transformative power of a NetSuite dashboard(opens in new tab) came from a company providing its board of directors with a unique dashboard of their own to track company financials. With full access, board members can get their questions answered before the board of director’s meeting and even answer questions on their own.
“It’s rare but it does happen,” Kelly said.
Now instead of forcing the finance team to spend weeks putting together a large (or if you prefer ginormous) PowerPoint deck and spending the board meeting answering questions about the data, board members can focus on the reason they’re there – to discuss strategic direction and bring value to the company.
And closing the books each and every day? Kelly insists it is possible, it just requires constant refinement and practice. Leveraging the Expensify SuiteApp(opens in new tab) helped one company free up sevERen man days that could be better used toward things like creating a paperless accounts payable workflow, bringing people closer to the goal of a daily financial close.
The same holds true for other financial processes like bank reconciliations or paying bills.
“Why not cut checks every day,” Kelly asked. “If you make it part of a process, you find many of the things you do in the close can be automated and streamlined. For those of you with fixed assets, NetSuite has a module where you can handle that by pushing a button.”
It’s paid off for many T > Edward clients that have adopted a daily financial close. One client, a midsized retailer based in the Midwest, was able to see its revenues in the stores in real time, which ultimately allowed the company to track which advertising channels were working best in which locations, allowing the company to optimize its advertising spend and drive revenues.