Pandemic a “wake-up call” for finance

Digital transformation is now recognised by the vast majority of finance leaders as being crucial to the future success of their companies, according to a survey conducted by Financial Director.

Nick Ludlow, regional vice president at Chrome River, believes the pandemic and the lockdowns that ensued have awoken finance leaders to the value of digital transformation.

“It’s been a short, sharp, wake-up call for anyone who didn’t have online processing of expenses, AP and other finance-related activities,” Ludlow says.

The survey, conducted in association with Chrome River between September and October 2020, found that 94 percent of finance leaders said digital transformation would be important or very important to the future success of their company. Less than one percent said it held no importance.

“It’s clear that digital transformation is almost universally viewed as critical for the success of any company. I suspect that even businesses which were on the fence earlier were swayed by the impact of the pandemic,” says Ludlow.

“First, the sudden move to working from home made it very evident that any paper-based processes are almost impossible to perform when the team is dispersed. Second, spend control and visibility into cash flow have become life-or-death issues for some companies. In order to achieve this successfully, finance teams need to have timely and accurate data that they can analyse. This simply isn’t possible without having digitised processes,” he adds.

A survey by DMEXCO of German, Swiss and Austrian companies in April 2020 found that 70 percent expected the coronavirus pandemic to accelerate digital transformation shifts. Ludlow agrees, but is concerned that the pandemic and its consequences left many finance leaders feeling caught out as they scrambled to get their teams capable of working from home.

It’s just been unbelievable. In the first three months following the start of the initial lockdown, people were in panic mode as most finance teams didn’t even have a setup at home to work,” Ludlow says. “It wasn’t physically possible to maintain their businesses without quickly bringing a solution to enable remote working, and start digitising their finance processes.”

With news of potential vaccines to coronavirus being announced by Pfizer and BioNTech, Moderna and Oxford University and AstraZeneca, life will likely begin to return to normal in 2021. But while that may mean that social-distancing requirements end, the shift to digital will not. A 2020 report by Forrester predicts that the end of 2021 will see 30 percent of $1bn+ firms have a significant digital product portfolio with 20 percent having stand-alone digital divisions.