Onguard’s fintech measurement tool has been monitoring trends and changes over the last few years. The latest data from the Visma Onguard Fintech barometer indicates that the number of businesses intending to implement a digital transformation strategy within the next 6 to 12 months has doubled since 2019.

The Fintech Barometer consists of an annual survey of finance professionals in the UK and the Netherlands. Finance professionals are questioned about their payment behaviour, the application of fintech and what technologies they believe are emerging within their organisation.

The impact of digital transformation on the fintech market

The study suggests that the overall success of fintech is dependent on how a particular business is applying digital transformation processes. In the Netherlands, digital transformation is common, with over 50% of businesses in process of applying digital technologies. In the UK, the rate is a little lower, with around 24% in progress.

When assessing top technology trends used by finance professionals, AI has emerged as the top choice, with nearly half of businesses selecting it as one of the top three technology trends forecast to impact the sector. The ability to measure and assess data is a growing requirement for finance professionals, increasing from around 37% in 2020 to 44% in 2021.

The future of fintech

Looking ahead, blockchain technology is regarded as a major part of the next stage of the fintech era, with nearly 65% adopting the technology or having a plan in place for blockchain use. These results suggest that finance professionals recognise the importance of integrating digital transformation strategies, particularly after the pandemic and all of the associated challenges we have had to endure.

A few years ago, nobody could have predicted how the world would change and the survey findings highlight the impact the challenges of the last year have had on finance professionals towards innovation and the fintech industry. This results in an emerging trend towards digitisation, creating data-driven insights and increasing adoption of new fintech services. More businesses are actively focused on digital transformation measures and industry experts anticipate this to continue over the next few years.

Climate strategies need to be supported by clear strategies and data. Finance leaders will play a leading role in creating the necessary plans and delivering sustainability reports.

The climate summit ended with several commitments and announcements targeting climate action and requiring significant implications for businesses and organisations. Countries agreed to adopt the Glasgow Climate Pact involving putting an end to fossil-fuel subsidies, phasing out coal, implementing measures for carbon markets and supporting climate efforts in poorer nations.

The Glasgow Financial Alliance for Net Zero (GFANZ), a group of 450 financial institutions within the region of $130 trillion of assets, has committed to financing a transition towards a net-zero economy. 

COP26 provided an early insight for businesses into the future and how regulations are transforming. For finance professionals working with businesses with climate targets, the next big step is creating a clear and comprehensive strategy. It’s one thing to pledge a goal and another to deliver on them with consistent actions. Partnerships and collaboration between the public and private sectors are critical to meeting climate commitments. Businesses may also have to partner with other organisations across multiple industries to reach their net-zero targets.

Sustainability Reporting

Following a strategy, businesses need to deliver on what actions should be taken and report on their progress. For the finance industry, one of the most developments was the IFRS Foundation announcement of developing the International Sustainability Standards Board (ISSB) and the IFRS Foundation consolidation of the Climate Disclosure Standards Board (CDSB) and the Value Reporting Foundation (VRF).

The new sustainability board provides a path for sustainability reporting to become a common language that helps businesses deliver a consistent and connected strategy that drives vital decisions.

CFOs should start getting data from the source and measuring, managing and reporting on metrics. An important factor in this entire process is training the finance team for the future. Some industry experts believe there aren’t enough finance professionals that exist and understand sustainability reporting. Goals have to be reinforced by systems, processes and data. Businesses that utilise this data and information will create clear communication with investors and ultimately deliver greater access to capital.

Businesses recognition of the climate crisis is an opportunity for finance professionals to take more control of business decisions. It is an opportunity for finance professionals to take a leading position rather than being led. Finance people need to recognise that individuals are emphasizing individual responsibility towards the environment and the community.

Allen Shim became the CFO of Slack after shifting his attention towards what priorities the position needed. 

Back in 2014, Slack had around 20 employees when Shim joined as a finance executive. He quickly became responsible for managing finance, analytics, accounting, as well as other functions within HR, IT and legal.

In a previous interview, Shim explained that he felt like he had the responsibility of a CFO but it wasn’t until he stopped wanting the job that he began to understand how he had been limiting himself through certain actions.

After experiencing a complete review in 2017 one thing stood out to Shim and that was that his fixation on becoming a CFO was hindering his overall effectiveness. Taking this on board, Shim reconsidered his performance and understood that rather than focusing on his achievements, it was more important to determine whether he was the one capable of driving this business forward. It was this shift in mindset and how he interpreted his personal development over time that was so critical.

After further discussions with other CEOs, Shim reassessed his organisation and quickly realised that he was overseeing multiple functions. As a consequence, Shim was spreading himself too thin and incapable of allocating enough time to each task required to be an effective CFO.

Shim highlights that to become a CFO, he was required to become excellent in financial planning and analysis (FPA) and appreciate exactly what factors would drive the business forward. Shim started focusing more on the way a CFO could create a structure in the business, supporting scale and growth over time. 

The shift in mindset enabled him to apply more energy towards business strategy and ironically ended up with him being offered the role of the CFO later that year. The change in focus on career advancement ultimately enabled him to progress in a way that facilitated the goals of becoming a CFO.

The pandemic has increased digital adoption across all business industries. The finance function must embrace new technology and develop the necessary new skills to maintain its position.

Mark Cracknell, the head of research at digital firm Generation CFO highlights a glaring disparity between how people operate in the workplace and their personal lives. Cracknell explains that in our personal lives we are relatively digitally advanced but when we are in the workplace we regress to manual activities.

This situation is changing and the next generation of workers are questioning why operations aren’t more digital and automated. The pandemic has also accelerated the digitalisation of the workplace and the necessity for more timely data. Cracknell believes that people will have to go down this route, to be more cost-efficient and technology can provide the answer.

Cracknell refers to the NHS Shared Business Services as a good example. On a Generation CFO webinar, the head of finance and accounting said the team wouldn’t have been able to survive over the last year or so had they not established a strong digital position as they entered the pandemic. The organisation used to have over 100 people working on manual tasks and distributing invoices, but adopting e-commerce enabled them to reduce this number to 11.

The digital skills finance team is relatively broad and not everyone working in finance will be good at the same thing. Team leaders will need to be capable of identifying various skills and harness this potential to get the best results. One of the initial steps needed in regards to upskilling in finance is understanding exactly what technology can do.

The skills required within the finance function can be divided into two categories. One side is more technical and focused on understanding data, how to use and read data and generate the right conclusions from it. This includes knowledge of the capabilities and limitations of automation and AI. The skills that generate the most value are the more human-focused skills, including storytelling, influencing and presentation. The key is being capable of understanding the data and creating a supporting story and sharing this information with leaders in a way that will influence future decisions.

David Anderson, partner at Deloitte MCS collaborated with the ICAEW on Finance in a Digital World, a training service to support understanding and awareness of the potential of digital technology. Anderson highlights the focus on technical skills as one particular challenge the industry faces. Anderson explains that as we progress towards a more digital and flexible future, areas such as problem-solving, creativity, questioning the norm all become more important and should not be considered technical skills.

Understanding the dynamics of a team is vital when deciding how to upskill finance with a more digital approach. It’s also influenced by talent acquisition, by focusing on attributes and behaviours, rather than just technical ability.

Cracknell and Anderson describe an approach that incorporates a combination of technical skill sets concerning data management, AI, machine learning and the development of more commercially focused human skills. Cracknell suggests a combination of digital-focused education and ensuring people gain hands-on job experience.

Cross-generation mentorship, where younger staff teach more experienced staff digital skill sets in return for business and organisational skills can be beneficial. Anderson recommends supporting curiosity and encouraging everybody in the business to acquire a certain level of understanding around these industries. The ICAEW Data Analytics Certificate Programme supports the finance team with learning to harness and understand data and how it influences a business.

While it’s not considered like this, data could be interpreted as one of the most important commodities on our planet. Every day we produce data, businesses collect it, extract useful information, convert it into actionable insights, and then develop new products and services. 

Data sharing refers to an agreement that involves waiving privacy for commercial purposes. Customers benefit by having higher access to relevant products which financial service institutions benefit from enhanced marketing and development opportunities. 

In a recent article by Deloitte called ‘The next generation of data sharing in financial services, the FSI benefits of data sharing are split into 3 key categories:

1. Inbound data-sharing and converting this into more focused decision making.
2. Outbound data-sharing enables businesses to harness capabilities that may be missing from their organisation.
3. Collaborative data sharing allowing businesses to develop richer, larger and more detailed datasets than possible with siloed data.

Despite the clear mutual benefits of data sharing, there are still several challenges and issues to overcome. For customers, there is caution with sharing sensitive information. Statista discovered that over 44% of US fintech app customers had experienced some level of reluctance in terms of information on accounts, loan or investments. Another survey conducted on behalf of IBM discovered that only 20% of customers had complete trust in businesses to maintain their data. With major data security breaches rising, it comes as no surprise that customers are a little hesitant with sharing their information.

What are the key benefits of data sharing?

For the institutions, it means better decision-making and the ability to broaden their capabilities and generate greater volumes of data. For the regulators, it enables further innovation and effective system oversight. Customers have access to higher quality and more relevant and efficient products.

What are the drawbacks of sharing data?

For institutions, there is the potential of breaching privacy regulations and impacting relationships with customers. Similarly, regulators could experience possible cases of breaching customer privacy and customer’s data may be mishandled or misused.

Data sharing does come with risks for FSI; developing a scenario of openness could eliminate competition bypassing too much information to rival businesses. Evolving privacy regulation could be breached by changes in technology.

The value of Open Finance

Open Finance is focused on empowering customers, giving them the ability and control to reuse their financial data in new and innovative ways. It does this by enabling third-party providers to securely access data and put it to work for the customer. This can be done by:

-Consolidating accounts into a unified view

-Enabling electronic data transmission that eliminates the necessity for physical documents when applying for financial products

-Using data as a method of identity verification

This is all included in open banking, allowing for a more direct consumer-banking relationship. Customers are increasingly looking for financial data aggregation services because it makes personal financial management simpler and more accessible. Banks and fintech both want to represent the primary platform for financial services and are currently competing to retain and attract new customers.

Implemented in the right manner, the benefits of Open Finance for both customers and businesses make it an attractive option. There is, however, a constant security concern. Data sharing, at any level, should remain a top concern, with each section of data requiring the appropriate level of protection and ensuring customers have an understanding of how and why some data is used. Informed consent involves understanding the implications of sharing before approval. It’s clear that aside from general clarity with data sharing policies, customers also need examples that show why APIs are beneficial and what exactly Open Finance can do for them.

A recent partnership between TrueLayer and UK digital bank Monzo showed this in action. With customers using Open Finance as a payment option for online gambling, Monzo required a solution to protect at-risk customers by blocking certain transactions to selected gaming sites. TrueLayer started working with Monzo, implementing a specific API capable of notifying the bank whenever a customer with gambling restrictions on their account attempted to pay via Open Finance. TS Anil, the CEO of Monzo praised the partnership, stating that it was simple to develop and capable of protecting thousands of people. Such examples in the finance industry will be critical in convincing customers that data sharing can be responsible and support safeguarding.

Data sharing via Open Finance is a route towards enhanced convenience, better products and considerably cheaper operations for FSIs. Ensuring customers understand the benefits will be the priority and experts highlight that managing physical financial documents will become a thing of the past.

The latest developments in Oracle Cloud HCM will allow HR teams to deliver personalised, AI-driven processes to support their employees.

Oracle has revealed a new platform that will provide a more streamlined employee experience in the Oracle Fusion Cloud Human Capital Management (HCM).

Oracle Journeys support businesses by delivering a one-stop platform for employees as they continue to focus on various aspects of work and tasks. The new services allow HR teams to develop and deliver detailed steps to guide employees through several events such as onboarding, returning to the workplace, launching a new service or developing their career.

Chris Leone, the senior VP of development at Oracle Cloud HCM explains that as our homes have become our offices over the past year, we have become more used to how technology can improve our lives as consumers and employees are looking for that same experience at work.

As offices begin to reopen, it will be important to enable consistent and positive experiences for the office and remote workers. Organisations will need to provide support throughout an employees entire career. Leone explains that Oracle Journeys will help HR provide value that expands beyond conventional HR processes by offering unique experiences for their employees.

Oracle journeys will guide employees through activities and particular milestone and offer access to resources needed across the entire business. It will make it simpler for employees to take action as they navigate through different events. The new features in Oracle Journeys allow HR leaders to go beyond the standard HR workflows and create personalised, step-by-step support for any task. By offering quick access to AI-powered services tailored to each individual, the solutions support employees in saving time and improving overall productivity.

Global HR analyst Josh Bersin highlights that employee experience is an essential, multi-disciplinary challenge and the needs of employees differ greatly. Businesses need simple, customised services to create, measure and integrate employees digital lives. 

Businesses that make a concerted effort to improve tasks with positive experiences for their team will yield the benefits of higher levels of satisfaction, engagement and productivity.

Customers can manage their path in the HCM systems. This allows businesses to better manage and grow their workforce in difficult times, but also allows HR to become an innovative part of the entire organisation. The demands and expectations of employees have changed considerably. Right now, our workforce requires bespoke support and motivation. Oracle Cloud HCM offers an individual HR platform that enables better management and the ability to meet changing expectations. Utilising this solution we ensure businesses are ready to deliver a positive employee experience, no matter what changes we may see in the workforce in the future.

Anaplan has confirmed that it’s making its business planning and forecasting tools available on Amazon Web Services public cloud platform.

Anaplan provides an enterprise platform that can be used for a range of business planning purposes. The new offering is focused on an in-memory database and calculation system called HyperBlock that allows users to manage and analyse various data sets quickly across finance, HR, sales and other core business operations.

The announcement was accompanied by better than anticipated fiscal final quarter earning reported. One big advantage of the Anaplan platform is its excel-style functionality which makes it very accessible to many workers. The software includes various modules to support data-focused decisions across budgeting, demand, quota and workforce planning, planning and forecasting, commission calculation, financial consolidation and profitability modelling.

The Anaplan on AWS offering will combine the business planning tools of Anaplan with the scalable cloud infrastructure available at Amazon. It will allow businesses to work with large, diverse data sets and analyse different scenarios in real-time.

Ana Pinczuk, the senior VP and chief development officer at Anaplan explains that they are looking to expand the reach of the customers they serve. By integrating with AWS, Pinczuk believes the platform will be opened up to a much broader range of customers. Many of their new customers targeted by Anaplan have current relationships with cloud providers like AWS. Pinczuk believes the partnership will make it simpler for those customers to integrate their cloud-based data with its business planning software.

Users will be able to integrate services such as Amazon Simple Storage Service and Amason Redshift for data analytics specifically with the Anaplan platform. This will support customers in delivering accurate forecasts across a range of industries. Forrest Danson of Deloitte Consulting LLP believes that Anaplan on AWS will support businesses plan across various dimensions enabling them to keep momentum with continued market changes and to leverage new opportunities.

The partnership with AWS represents the second deal with a major public cloud infrastructure provider, following the announcement with Google Cloud last year. 

Advanced analytics is rapidly becoming a popular tool for business leaders looking to leverage the benefits of generating more insights on delivering more solid decision-making processes.

All businesses are capable of collecting data on their customers and market and even their competitors. There is a huge amount of data available with the potential to create insights if analysed in the correct manner. Having the data is, however, only the first step and will have little value without effective analysis. The latest technology developments in terms of visualisation, machine learning and more means of analytics have radically transformed and are in a much more powerful position than it was several years ago.

Advanced analytics enables businesses to add value and reliability to the decision making process. It reduces the risk and defines the probability of events or scenarios occurring, which is very valuable to a business. It combines various processes and tools that enable the data collected to be reshaped into patterns, trends, anomalies and key insights to allow decision making to be executed with more precision and accuracy than ever before.

Advanced analytics applies various techniques and processes to convert data into insights. Big data analytics utilises large pools of structured or unstructured data, examining the information to define key areas requiring further focus and analysis. Data mining involves extracting useful data from its raw form and analysing the information to determine the importance, impact and relevance of these datasets. This is where predictive analytics comes into play, enabling businesses to apply machine learning tools to existing and old data to define a prediction model that enhances business outcomes. Generally, the more data available, the more accurate predictions are for a business. While predictive analytics cannot represent exactly what will happen in the future, it provides a range and possibilities that could occur based on the decisions taken by a business.

Whether your a commercial enterprise or government organisation, advanced analytics represents a strong platform for enhanced decision making, improved investment choices and better governance plans. A simple example of advanced analytics is how it is effectively applied to online retail and other media services. Online platforms display recommended relevant items to purchase or content to digest, usually using advanced analytics to track and monitor user behaviour and determine other interest areas for the user. This information is useful to the customer and business and can result in additional revenue generation and higher engagement. With user experience being critical, advanced analytics is generating a win-win situation for both customers and businesses.

Advanced analytics can be applied to various areas of businesses. A priority is creating more efficient and smarter decisions, supporting people with understanding which areas require improvement and will ultimately increase business success. Risk is another significant area for businesses to focus on. Advanced analytics enables companies to have a clear understanding of trends and factors that influence the level of risk. This information is valuable in creating processes, policies or business plans that can support better governance and compliance.

Advanced analytics is accelerating in popularity as more businesses explore the benefits of gathering more insights and generating effective decisions. Organisations understand that data is a valuable asset but the challenge remains the same, applying affective and useful analysis continues to be a priority for delivering the results they require.

A new survey by researching firm Censuswide discovered that nearly 70% of global business and finance executives lack confidence in data. The survey of C-suite executives and F&A professionals commissioned by automation software business BlackLine discovered that under 30% of respondents are confident that the financial data they use for financial analysis and forecasting is accurate, despite a further 30% claiming they are under more pressure to present more accurate findings of performance due to the pandemic.

The study of 1,300 business leaders spanning seven markets (US, Canada, UK, Germany, France, Singapore and Australia) focused on the impact of the pandemic on a random selection of various global organisations. The results suggest that while businesses appreciate the important role financial data plays in managing business strategy and continuity, the lack of visibility and access to real-time data is impacting businesses ability to respond effectively to volatile changes in the market. When asked about the impact the pandemic has had on their business, over 40% stated that their business had become more focused on financial scenario planning and stress testing due to the ongoing impacts of Covid-19. A similar proportion also stated that F&A is becoming more popular by senior members to support scenario planning, indicating the importance of financial insights in moving towards a stage of recovery. 

The findings also suggested that nearly 30% of respondents are concerned that their F&A teams are not able to generate data quickly enough for their business to respond to the constant changes in the market. A combination of remote and office-based working conditions could make this even more complicated. Over 25% of respondents indicated that hybrid working models will make it more challenging for F&A teams to work together and suggest it could lead to potential inaccuracies in financial data.

Additionally, over a quarter of C-suite executives believe that they have little or no visibility into financial scenario planning or stress testing at their business, suggesting that some leaders could be making decisions based on inaccurate or incomplete information on the financial health of their business. This lack of visibility is hindering the trust in data used for vital financial processes and planning, particularly with C-suite leaders. Just over 50% of C-level executives are completely confident in the accuracy of their financial data, compared to 71% back in 2018. When F&A professionals were asked the same question, only 30% stated they were confident in the accuracy of their financial data, compared to 38% in 2018.

The main reason for this lack of trust was mainly due to the continued reliance on traditional spreadsheets and using dated processes that result in F&A teams with little visibility until the month-end. Some respondents pointed out that the problem has increased since 2018, suggesting the transition towards digital systems in F&A still needed work. Marc Huffman, the CEO of Blackline explains that aside from the impacts on our health and wellbeing, the pandemic has continued to impact businesses across the globe.

As things progress, businesses need to rethink and readjust their operations and ensure they are ready for possible outcomes, applying solid and reliable data to enable quick and intelligent decisions. Huffman emphasises that the businesses capable of doing this will be in a better plan to progress over the next few months. Huffman believes that many businesses are struggling with visibility and access to real-time financial data, yet there is a consensus that needs to change. The study indicates that business leaders understand the value of having reliable and accurate financial information and are ready to take action. 

The results show that the pandemic has developed a heightened urgency concerning digital transformation and added investment in technology. Over 30% of respondents surveyed stated that the developments in the last year have made people appreciate real-time access to financial data. When focusing on best practices and remaining competitive, technology that allows better management and visibility over financial data has a critical role to play. Over 30% stated that investing in data analytics will support their business in retaining a competitive edge and a similar number are exploring options of automation solutions to improve the accuracy and the reliability of their financial data.

New research from Gartner explores how FP&A teams can provide finance analytics that supports planning and decision making.

Analytically focused decision making has become critical for many businesses, particularly during the global pandemic. The key question now is which decisions should the financial planning and analysis (FP&A) team support?

A new report from Gartner suggests that analytics-driven decisions in businesses has increased, but believes that finance analytics should take priority and support this process. Leading companies have embraced a business-focused approach to finance analytics. To enable further growth requires additional financial analytics to support the decision-making process.

Gartner’s studies suggest there has been a 50% increase in analytic spending over the last three years. Gartner is calling for a shift towards finance analytics from the standard passive reporting structure to a more engaged process. As more sectors continue to improve their analytic capabilities, finance analytics governance becomes a little unclear. According to Gartner FP&A leaders are now questioning what role finance analytics should play in the wider analytics arena and how specifically FP&A teams can support these analytics.

Finance analytics reporting and support make up over 30% of spending in the finance function. Gartner emphasises that these investments in finance data do not support modern decision making and managers lack the understanding of how to use it efficiently. Gartner believes that the incorrect use of finance analytics can cost businesses as much as 1% of revenue per decision, mounting up to a major impact on business over time.

Gartner believes that to regain the real value of financial analytics, a business should focus on finance transformation. Business manager and finance teams should work together to define, develop and implement finance analytics. Gartner explains that decision-makers with clear data governance plans can deliver problem economics, collaborate more insights and drive each other’s concepts forward.

Gartner recommends businesses transform their finance analytics from a standard, passive reporting structure to a more relevant and engaging platform that encourages more discussion. This can be achieved by:

-Generating finance analytics based on scenario analysis
-Developing more dialogue and opinion in finance analytics reporting
-Improving the accessibility of finance analytics

Gartner explains that progressive companies are adjusting positions for joint finance analytics decision making. Being with focusing on a business decision first and finance analytics after. Gartner emphasises that finance analytics problem solving can be improved by predicting and planning for failure early.