It was the top-performing area in the emirate in terms of last year's fourth-quarter sales
Let’s begin with the word Change. In this recovery phase, there has been a major shift in mindset and culture change among organisations and its functional leaders when it comes to driving technological adoption within. Also seen is a larger share of strategic responsibilities placed among finance leaders. On the other side we have organizations who find it hard to cope with such change and transformation. How does Jedox help organisations navigate through such hurdles – i.e what needs to change and how to do it more effectively?
In a recovery phase, the mentality of ‘never again’ often kicks in. Organisations that navigated the challenging market conditions of the last couple of years emerge with a newfound sense of urgency to address how they can make their operations more resilient and adaptable. In this journey to increase resilience and improve their competitive edge, how to adopt technological advancements are frequently the first stop.
One area where using advanced technologies has become vital to addressing the shortfall of traditional processes is in corporate planning. Every company needs to carry out their budgeting, planning, and forecasting on an annual basis at a very minimum. But the pandemic shone a spotlight on the fact that the approach of conducting this as an annual activity is no longer practical. Organisations that completed their budgets in October 2019 would have found them obsolete in March 2020. As a result, we’re seeing organisations increasingly moving towards higher frequency forecasting. So, while they still conduct yearly forecasts, they revisit these on a more regular basis to be able to make decisions with more current data.
What enterprise performance management (EPM) does is to simplify and accelerate the budgeting, planning, and forecasting process with workflows in a very collaborative manner. In the past, the majority of companies used Microsoft Excel for their budgeting process, but this is a highly manual system that struggles to meet the demands of business today. So, for example, if you have three hundred departments that you now need to include in your forecast, it will be very difficult for you to coordinate this with spreadsheets alone and make sure everything is current and accurate.
As an industry-leading EPM platform, Jedox drives efficiencies and productivity by first enabling the automation of repetitive business processes. Then it also strengthens collaboration by unifying planning across the organisation. With Jedox, you can transform your planning to extended planning and analysis (xP&A) wherein every department can create continuous, company-wide plans that are more agile and more accurate hence organisations can get better insights and drive better decisions based on real-time data.
Could you talk about the evolving role of the CFO and how today, their function extends beyond the bounds of the finance department alone.
Since I started in the EPM space 28 years ago, there has been an enormous shift in how budgeting, planning, and forecasting is done. Initially, there was just one person, typically the CFO or COO, who was in charge of the budget. This evolved into the era of financial planning and analysis (FP&A) where finance worked with a top-down and bottom-up approach. At this point, workflows came into play, and organisations started to leverage the knowledge of resources within the finance department. And now, the evolution has continued with xP&A where the CFO is now no longer just the cost controller, but also the advisor to the management, and the business partner to all departments in the company – extending the process of budgeting, planning, and forecasting to functions that include sales, marketing, HR, IT and more so that the focus can then be on optimising value.
Unifying data and data flow across the organisation is crucial. Do you think such level of data management can increase inter-department collaboration and performance?
For many years, companies have used the traditional method of spreadsheets for their financial planning and analysis. Spreadsheets are manually distributed to various departments by email, with changes often manually collated into a large spreadsheet. This is labour intensive and time-consuming.
But things change. Dealing with a pandemic, oil prices, supply chains, and more means we need to react extremely quickly to new realities. The traditional methods are no longer fit for purpose. We need agile, flexible platforms to speed up our planning and budgeting processes and provide better insights. Automating those manual, repetitive processes allows companies to quickly and automatically run entire data sets that can more quickly identify trends and anomalies.
Moreover, these platforms aren’t just for finance. They support the entire value chain. They enable you to see the whole picture at a granular level, so you can understand what’s going well, what’s not – and why.
Every department plans and budgets, and they all need to contribute for a full-picture view. And whenever things change in any area, this is easily reflected on the future balance sheet and the profit and loss. This real-time data from every department is key.
Taking a leap into the future. We see cloud migrations, AI deployments, data and insight-driven F&A functions, Blockchains coming into play and most importantly functional leaders working closely with their IT counterparts. Do you agree that the future of the function of finance is based on such advancements and collaborative mindset?
Yes. A collaborative mindset is absolutely going to be key to the future of finance and embracing technological advancements. However, doing so effectively also means not being a drain on already strained IT resources. This leap into the future requires embracing solutions designed for business users and not having to ask the engineer in IT to make changes for you.
Additionally, ongoing globalisation and the resulting increase in competition highlights the need for business strategies to be frequently adapted. Today, even the very largest organisations risk seeing their market share being eroded by more agile players that are capable of rapidly evolving in line with fast-changing markets. So, where planning and forecasting were previously characterised by laborious, error-prone processes; recent advancements in automation and AI and ML are driving what we refer to as the digital enterprise.
As a solution provider that enables xP&A, can you highlight what are the dynamics in the region that can favour an xP&A transformation. Is there a regional advantage for companies based here as compared to other geographies when it comes to driving change? And what they can expect from Jedox in the region.
According to the World Bank, the economies of the Gulf Cooperation Council (GCC) are in a strong recovery phase. As recently as August, the organisation’s Gulf Economic Update (GEU) projected aggregate growth of 2.2 per cent for the region in 2021, citing past strategic investments in infrastructure and forward-thinking commitments to technologies such as 5G. In 2022 and beyond, the GEU foresees growth rates among individual GCC countries accelerating to between 2.5 per cent and 5.3 per cent. Today, as in years before, in the background of all business decisions that are driving this growth sits the finance department that has long since leveraged FP&A to gain the insights that underpin strategic decision-making in project preparation, budgeting and a host of other areas.
But now, thanks to the emergence of a range of technologies designed to address growing volumes of data, finance leaders can enable even better business performance with xP&A. It provides the same capabilities as FP&A but goes further to increase collaboration between every department under a unified performance management approach. Up-to-the-minute, comprehensive, accurate, companywide plans. xP&A can be thought of as accurately and continuously measuring the performance of multiple processes across the enterprise and detect trends and problems before they impact revenues and profitability. Upon implementation, planners in any department will experience real-time benefits.
Jedox is focused on xP&A and our advantage is that we are an independent EPM vendor, which means we offer seamless integration with ERP systems. So, whether it is Oracle, SAP, Microsoft Dynamics, NetSuite, or anything else, accessing important data is no longer a struggle and the door to optimising value creation is open.
Instead of having multiple modules that need to be interconnected to function, the Jedox approach also is easily adapted to custom requirements. Our customers’ applications, such as those for sales planning, HR planning and more come together with a single platform. As a result, updates on any of these applications result in real-time updates to financial statements, P&L, and balance sheets. This is how we enable each and every department to be a collaborative part of the financial planning, budgeting, and forecasting process for a holistic view of business performance.
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