Imagine if you could peek inside your company's finance department and see the intricate web of tasks and processes that governs every transaction, approval, and report. Process intelligence is a cutting-edge technology that allows you to do just that - and it's just become even more suited for the needs of finance leaders.
Finance process intelligence a new analytical technique that extracts data from various business applications and workflows to discover, monitor, and improve business processes. The solution combines the best elements of task and process mining to suit the complex needs of today's digitalized finance departments.
Before we go through key use cases for finance process intelligence, let's go through some fundamentals.
What are the core financial processes?
At the heart of every business lies its essential finance department, which holds the keys to the organization's financial success and stability. Finance departments play a crucial role in the overall health and growth of a business. They carry the responsibility of managing the company's financial resources, making informed decisions, and providing valuable insights that help shape the organization's future.
A finance and accounting department can take on a broad set of responsibilities for anything from bookkeeping, invoicing, expense approvals, budgeting and forecasting. More broadly, finance teams often lead facilitate go-to-market strategies through CAPEX and OPEX investments and manage risks and accountability to suppliers and tax authorities.
The core finance processes are simply the tasks and workflows managed by the finance and accounting department to manage the company's financial resources to meet the business objectives.
Six core finance processes
Each finance department is different. If you six CFOs for a list of their core processes, you'd get six different answers. Still, we can distil the key finance operational processes to the following shortlist.
- Purchasing
- Accounts payable
- Invoicing and accounts receivable
- Tax compliance and reporting
- Travel and expense management
- Financial reporting
.png "Six core finance processes that can be improved with process intelligence – Workfellow (1)")
Who is responsible for finance processes?
The responsibility for finance processes lies with a dedicated team of professionals, from the CFO to the payroll administrator. In some larger organizations this may include dedicated departments for individual functions, such as Accounting, Accounts Payable and Accounts Receivable, while in smaller organizations it may simply be a team of finance managers and controllers who take responsibility for a wide set of tasks, workflows and processes.
More broadly, everyone should take some ownership of finance operations and controls of their organization. Virtually every employee interacts in some way with the finance team, whether it is through budgeting for business operations, payroll or simply approvals for travel expense claims. If there are challenges with the resources or capacity of the finance team, everyone is likely to feel it. Manual processes or inefficient approval process steps quickly add up to take up valuable time and resources from the entire organization.
What's usually wrong with core finance processes?
While the fiscal reality of companies differ, typically the health of financial transactions is not a core finance process problem. Most companies are able to fill financial statements in good order, record business revenue appropriately and manage cash flow.
The greatest challenge for finance teams' processes lies typically in managing capacity of the finance team across a large number of financial process controls and workflows, where key processes and process bottlenecks may be difficult to manage across a large number of different IT systems and business applications.
On average, a large enterprise business runs on over 170 different business applications. There may be different applications finance teams used to manage payment requests, strategic planning, vendor approvals, travel expenses and so on. In addition, financial data often needs to be consolidated or reported in different kinds of management dashboards, leading to a large amount of manual data entry and toggling between multiple systems. Recent research by Workfellow found that a typical finance team employee spends 90minutes each week toggling between different applications and 50% of their work time on repetitive tasks.
How do you know you have finance process challenges?
The nature of finance departments is often hectic and high paced. However, a few common symptoms separate healthy financial processes from chronic finance process failure:
- Delayed or slow approval – if payments are regularly delayed or approval processes are inefficient.
- Lack of clarity of roles - when it's not clear who is responsible for key metrics or tasks in processes and workflows.
- Difficulty managing workload - when the finance team constantly is over-capacity and works overtime to meet monthly closing processes or other regular tasks.
- Lack of visibility - when leadership is not able to measure and impact the end-to-end processes that occur across different business functions and IT systems.
How process intelligence can identify and fix finance process challenges
Finance process intelligence is a new software solution that combines the best parts of process mining and task mining solutions to give end-to-end visibility to all core financial processes and finance operations. The solution has been built from the ground up to meet the demanding needs of business operations professionals who have a goal to eradicate inefficient processes, streamline redundant tasks and automate manual work.
Finance process intelligence gives immediate visibility into existing process health and gives actionable insights into opportunities to improve efficiency, replace outdated systems and remove manual work through automation software. It's plug-and-play software that helps you make better business decisions and optimize finance operations with data you can trust.
How process intelligence benefits six core finance processes
Purchasing
Process intelligence software breathes new life into the purchasing function by streamlining workflows and automating routine tasks. It enables finance teams to make informed decisions based on accurate and up-to-date data, fostering a sense of confidence and control over procurement processes. By eliminating inefficiencies and reducing the risk of errors, process intelligence software contributes to a more cost-effective and responsive purchasing function, which has a positive emotional impact on the organization's overall financial health.
Accounts payable
Managing accounts payable can be a challenging and emotionally charged process, as it involves maintaining good relationships with vendors and ensuring timely and accurate payments. Process intelligence software simplifies this function by automating payment processing and providing real-time visibility into outstanding invoices. This enhanced oversight not only reduces the risk of late payments and penalties but also fosters a sense of trust and reliability among suppliers, ultimately contributing to smoother and more harmonious business relationships.
Invoicing and accounts receivable
Process intelligence software revolutionizes the invoicing and accounts receivable function by identifying bottlenecks, reducing errors, and streamlining payment processing. It empowers finance teams to proactively manage outstanding invoices and improve cash flow, alleviating the emotional stress associated with managing the organization's financial resources. By improving the efficiency and effectiveness of this core function, process intelligence software contributes to a more stable and financially secure business.
Tax compliance and reporting
Navigating the complex world of tax compliance and reporting can be a daunting and emotionally charged task. Process intelligence software simplifies this function by automating data collection, tracking relevant tax laws and regulations, and ensuring that the organization remains compliant. By reducing the risk of non-compliance and potential penalties, process intelligence software provides finance teams with a sense of security and peace of mind, enabling them to focus on strategic initiatives that drive business growth.
Travel and expense management
Managing employee travel and expenses can be a time-consuming and emotionally fraught process, as it requires balancing cost control with employee satisfaction. Process intelligence software streamlines this function by automating expense reporting, tracking compliance with company policies, and providing real-time visibility into spending pFinancial reporting is an emotionally charged process, as it provides stakeholders with a snapshot of the organization's financial health and influences critical business decisions.
Financial reporting
Process intelligence software supports this core function by automating data collection, ensuring accuracy and consistency in financial reports, and providing real-time insights into financial performance. This enhanced visibility and control enable finance teams to produce timely and accurate reports, fostering trust and confidence among stakeholders and contributing to the company's overall success.
Bottom line
In conclusion, process intelligence software is a powerful tool that can revolutionize core finance functions, streamlining workflows, enhancing data visibility, and improving decision-making. By addressing the emotional aspects of these functions, businesses can cultivate a more efficient, resilient, and emotionally balanced finance department that drives the organization's financial success. This enhanced oversight allows finance teams to make data-driven decisions that contribute to more efficient and cost-effective travel and expense management, ultimately fostering a positive work environment and supporting employee well-being.
Next step: find out how to improve finance processes with Object-centric Task Mining (OCTM)software. Read the new OCTMebook.
