Transforming Your Team With Digital Finance Landscape in 2023

22 May, 2023
20 min
Bill Sarda, Chief of Staff, Digital Transformation

Listen to the blog:

17:45

Table of Content

Key Takeaways
Introduction
Why Does Digital Finance Matter?
4 Key Trends of Digital Finance in 2023
Reinventing Your Team with Digital Finance
Real-life Use Cases of Digital Finance
Overcoming Challenges in Digital Finance
Conclusion

Key Takeaways

  • The benefits of digital finance for businesses include improved efficiency, better decision-making capabilities, and enhanced customer experience.
  • To succeed in the digital landscape, companies need to build digital-first teams with technical expertise, business acumen, collaboration skills, adaptability, and communication skills.
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Introduction

The world of finance has undergone a significant transformation in recent years, thanks to digital technologies. In 2023, this digital transformation is expected to continue, and it is more important than ever for businesses to adopt a digital-first approach to finance. 

This blog will discuss the benefits of digital finance for businesses and why it is essential to reinvent your team with digital finance in 2023.

Why Does Digital Finance Matter?

Benefits of digital finance for businesses

Digital finance offers a host of benefits for businesses. Let’s check out the top three benefits of digital finance for businesses.

  • Improved efficiency- Digital finance automates tasks such as invoicing, payments, and reconciliations, reducing time and resources required. This allows employees to focus on higher-value activities, leading to cost savings and increased productivity.
  • Better decision-making capabilities- Real-time financial data and advanced analytics provide insights into financial trends, informing strategies and identifying areas for improvement. This leads to more accurate forecasting, risk management, and strategic planning.
  • Enhanced customer experience- Digital finance offers convenient and user-friendly payment options, such as mobile payments and online transactions. Customers can access their financial information in real-time, monitoring their accounts and transactions. This increases satisfaction and loyalty, leading to increased revenue and market share.

Competitive advantage of digital finance

By implementing digital finance, businesses can gain a competitive advantage in today’s fast-paced economy. With more companies adopting digital finance, those who don’t keep up risk being left behind. Digital finance can help businesses stay ahead of the curve and outperform their rivals. 

For instance, companies can use digital finance to develop innovative financial products and services that cater to changing customer needs and preferences, which can create new revenue streams and strengthen their market position.

4 Key Trends of Digital Finance in 2023

The digital finance landscape in 2023 is expected to be characterized by continued innovation and disruption. Fintech startups and established financial institutions alike will be vying for a share of the market, using technology to develop new products and services that meet the evolving needs of customers. As such, businesses will need to stay up-to-date with the latest trends and innovations in digital finance in order to remain competitive.

Here’s a brief discussion on the four key trends in digital finance:

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  1. Fintech: The fintech industry is disrupting traditional financial institutions with innovative financial products and services like digital wallets, peer-to-peer lending, and robo-advisors. More fintech startups are expected to emerge in the coming years.
  2. Blockchain technology: Blockchain creates secure and transparent digital ledgers for transactions and contracts, which can reduce fraud and increase efficiency. Financial institutions and companies are exploring its use in payments, trade finance, and identity verification.
  3. Artificial intelligence (AI): AI-powered chatbots provide instant customer support and analyze large amounts of financial data to inform investment decisions and risk management.
  4. Automation: Automation reduces errors and increases efficiency by automating routine tasks like data entry and fraud detection. More automation is expected in areas like compliance to improve regulatory compliance and reduce risks.

Reinventing Your Team with Digital Finance

Building digital-first teams is crucial for organizations to thrive in the rapidly evolving digital landscape. These teams are composed of individuals who possess a deep understanding of digital technologies and can use them effectively to drive business outcomes. By building such teams, organizations can leverage digital technologies to improve financial operations, enhance customer experiences, and drive business growth.

Skills and capabilities required for digital finance teams

Here are some key skills and capabilities that are required for digital finance teams:

  • Technical expertise: Digital finance teams require technical expertise in areas such as software development, data analytics, and cybersecurity. These individuals should have a strong understanding of the latest digital tools and technologies and be able to apply them in a practical and effective manner.
  • Business acumen: In addition to technical expertise, digital finance teams also need to have a strong understanding of business operations and strategy. This includes understanding financial markets, regulatory frameworks, and customer needs and preferences.
  • Collaboration: Collaboration is critical for digital finance teams to be effective. These teams must be able to work closely with other departments within the organization, such as marketing, operations, and IT, to ensure that digital initiatives are aligned with broader business goals.
  • Adaptability: The digital finance landscape is constantly evolving, and digital finance teams must be able to adapt to these changes quickly. This requires individuals who are open to new ideas and willing to learn and experiment with new technologies and processes.
  • Communication: Effective communication is critical for digital finance teams to be successful. These teams must be able to communicate complex technical concepts to non-technical stakeholders and explain the business value of digital initiatives in a clear and compelling manner.

By building digital-first teams with these skills and capabilities, companies can leverage digital technologies to improve financial operations, enhance customer experiences, and drive business growth.

Restructuring the finance function for a digital-first approach

The finance function, in particular, needs to be restructured to adopt a digital-first approach. Here’s how:

  • Adopt a customer-centric approach: Digital finance teams need to understand customer needs and preferences and develop products and services that meet them. By adopting a customer-centric approach, teams can build more personalized and engaging financial experiences for their customers.
  • Embrace automation: Automation can help streamline financial processes, reduce errors, and increase efficiency. Digital finance teams should leverage automation to automate routine tasks like data entry, reconciliation, and reporting. This can free up time for finance professionals to focus on more strategic tasks like financial analysis and forecasting.
  • Leverage data analytics: Digital finance teams should use data analytics to gain insights into financial operations and identify areas for improvement. By analyzing financial data, teams can make more informed decisions, optimize financial processes, and improve business outcomes.
  • Develop digital skills: Digital finance teams need to have a deep understanding of digital tools and technologies. They should develop skills in areas such as software development, data analytics, and cybersecurity to effectively leverage digital technologies in their work.
  • Foster collaboration: Collaboration is critical for digital finance teams to be successful. Teams should work closely with other departments within the organization, such as marketing, operations, and IT, to ensure that digital initiatives are aligned with broader business goals.

By restructuring the finance function for a digital-first approach, companies can improve financial operations, enhance customer experiences, and drive business growth.

Real-life Use Cases of Digital Finance

So far, we have discussed the benefits of digital finance, key trends about in 2023, and how you can reinvent your team with digital finance by improving their skills and restructuring it. Let’s look at a few case studies about digital finance:

JBS

About the Company:

JBS is a global food processing company that produces beef, pork, lamb, and chicken products for customers in over 190 countries. Headquartered in Brazil, JBS has over 240,000 employees worldwide and operates more than 300 production facilities.

Challenge and Solution:

JBS was experiencing issues with its manual, paper-based accounts receivable (AR) processes. These processes were time-consuming and prone to errors, resulting in delayed payments and poor customer experiences. In addition, the lack of visibility into customer payments made it difficult for JBS to accurately forecast cash flow and plan for future investments.

To address these challenges, JBS implemented HighRadius' Integrated Receivables platform. The platform automated JBS's AR processes, including cash application, credit management, and collections, while also providing real-time visibility into customer payments.

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Impact:

Since implementing the HighRadius platform, JBS has achieved several key benefits, including:

Reduced manual effort: JBS has significantly reduced the manual effort required to manage its AR processes, freeing up employees to focus on higher-value activities.

  • Improved cash flow: The increased visibility into customer payments has enabled JBS to more accurately forecast cash flow and make better-informed investment decisions.
  • Enhanced customer experience: The platform has improved JBS's ability to manage customer accounts and respond to inquiries, resulting in a better customer experience overall.

Click to read the detailed case study

J.J. Keller & Associates, Inc.

About the Company:

J.J. Keller & Associates, Inc. is a leading provider of regulatory compliance solutions, including driver logs, electronic logging devices, and other fleet management tools. Based in Wisconsin, the company has been in operation for over 65 years and serves customers across a wide range of industries.

Challenge and Solution:

J.J. Keller was facing challenges with its collections processes. Specifically, the company's collections team was spending a significant amount of time on manual, repetitive tasks, such as sending reminders and following up with customers who were past due on their payments.

To address these challenges, J.J. Keller implemented HighRadius' Integrated Receivables platform. The platform automated many of the collections tasks that were previously done manually, including sending reminders and follow-up emails, while also providing real-time visibility into customer payments.

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Impact:

Since implementing the HighRadius platform, J.J. Keller has achieved several key benefits, including:

Reduced manual effort: The platform has significantly reduced the manual effort required to manage collections, freeing up the collections team to focus on higher-value activities.

  • Improved collections results: The automated collections processes have resulted in faster payments and improved collections results overall.
  • Enhanced customer experience: The platform has improved J.J. Keller's ability to manage customer accounts and respond to inquiries, resulting in a better customer experience overall.

Click to read the detailed case study

HNTB

About the company:

Harris is a leading provider of advanced radio communications and information technology solutions to public safety and professional communications industries. With a legacy of over 120 years, Harris is dedicated to creating mission-critical communications systems that enhance the safety, security, and efficiency of operations.

Challenge and Solution:

Harris faced challenges in streamlining their Accounts Receivable (AR) process due to the large volume of customer transactions and high percentage of manual effort required. They turned to HighRadius for an automated solution to reduce their Days Sales Outstanding (DSO) and improve operational efficiency. 

HighRadius implemented their Autonomous Receivables platform, which leverages artificial intelligence and machine learning to automate AR processes, including invoice presentment, cash application, and collections.

Impact:

Since implementing HighRadius Cash forecasting solution, Harris has seen impacts like:

  • reduced dso by 12 days within 6 months of implementing HighRadius solutions.
  • Achieved a 96% automation rate for cash application, freeing up staff to focus on higher-value tasks.
  • Improved the accuracy and speed of dispute resolution, resulting in a 30% reduction in aging disputes.
  • Increased visibility and transparency of cash flow, allowing the company to make more informed decisions.
  • Improved customer experience by streamlining processes and providing real-time updates on payment status.

Click to read the detailed case study

Overcoming Challenges in Digital Finance

Challenges in digital finance

As companies adopt digital finance practices, they often face some common challenges that can impede their progress. Here are some of the most common challenges faced during digital finance adoption:

  • Resistance to change: One of the biggest challenges is resistance to change from traditional finance teams. Teams may be hesitant to embrace new technology or processes, and this can lead to a slow adoption rate.
  • Lack of digital skills: Digital finance requires individuals with technical expertise in areas such as data analytics, software development, and cybersecurity. A lack of skilled personnel can make it difficult for companies to implement new technologies and processes.
  • Data quality issues: Accurate and timely data is essential for successful digital finance. Poor data quality can lead to inaccurate forecasts, flawed decision-making, and operational inefficiencies.
  • Integration challenges: Companies may struggle to integrate different systems and data sources. This can lead to data silos, where data is trapped in different systems and cannot be easily accessed or analyzed.

Best Practices to overcome challenges in digital finance

To overcome these challenges, companies can adopt the following best practices:

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  • Create a digital culture: It is essential to foster a culture that embraces digital transformation. This involves educating employees on the benefits of digital finance and creating an environment that encourages innovation and experimentation.
  • Develop a digital talent strategy: Companies should develop a talent strategy that focuses on attracting and retaining digital talent. This involves identifying the skills and capabilities required for digital finance and investing in training and development programs to upskill existing employees.
  • Prioritize data quality: Companies should prioritize data quality and invest in data governance processes to ensure that data is accurate, timely, and complete. This involves establishing data standards, implementing data validation processes, and investing in data quality tools.
  • Implement integration strategies: Companies should develop integration strategies that enable data to flow seamlessly across different systems and applications. This involves identifying key data sources, developing APIs, and investing in integration platforms.

By adopting these best practices, companies can successfully overcome the common challenges of digital finance adoption and achieve greater efficiency, accuracy, and agility in their financial operations.

Conclusion

In today’s fast-paced economy, businesses need to stay ahead of the curve by adopting a digital-first approach to finance. They need to transform their finance teams and adopt a digital-first approach to finance to stay competitive in 2023 and beyond. Companies that do not adopt digital finance risk being left behind by those that do, which could result in lost revenue and market share. 

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With a suite of cloud-based products, HighRadius empowers organizations to optimize their finance processes by automating accounts receivable, treasury management, and record to report. 

Our customers vouch for the efficiency gains they’ve received by automating their AR processes. Schedule a time to talk with us and explore opportunities to upgrade to a fully autonomous finance department.

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HighRadius Integrated Receivables Software Platform is the world’s only end-to-end accounts receivable software platform to lower DSO and bad-debt, automate cash posting, speed-up collections, and dispute resolution, and improve team productivity. It leverages RivanaTM Artificial Intelligence for Accounts Receivable to convert receivables faster and more effectively by using machine learning for accurate decision making across both credit and receivable processes and also enables suppliers to digitally connect with buyers via the radiusOneTM network, closing the loop from the supplier accounts receivable process to the buyer accounts payable process. Integrated Receivables have been divided into 6 distinct applications: Credit SoftwareEIPP SoftwareCash Application SoftwareDeductions SoftwareCollections Software, and ERP Payment Gateway – covering the entire gamut of credit-to-cash.