Subscribe
Share
Share
Embed
This is a collection of Audio Summaries and Podcasts generated by Gemini Pro and Ford LLM Notebook to help Finance Professionals in Product Development learn more about the business and finance concepts
Welcome to the deep dive, where we get you informed fast. Today, we're diving into something pretty huge. A, seismic shift in corporate finance, especially within industrial manufacturing. Yeah. Finance used to be, you know, mostly about keeping records.
Podcast Host:Now, it's looking more like a strategic nerve center.
Podcast Guest:That's right.
Podcast Host:So our mission today is to figure out how this massive evolution happened, and importantly, what it means for your business right now.
Podcast Guest:It really is a fundamental redefinition. You said seismic shift, and that's spot on. The old way, just focusing on compliance, cost control, stewardship, basically.
Podcast Host:Mhmm.
Podcast Guest:It's just not enough anymore. Finance teams are now expected to actively help shape the company's direction, navigate all this uncertainty we're seeing
Podcast Host:Yeah. There's a lot of it.
Podcast Guest:And ultimately drive sustainable value for shareholders. Yeah. It's a completely different game.
Podcast Host:Wow. Okay. A different game. So what's pushing this? What's forcing such a big change?
Podcast Host:Is it stuff happening outside the company or more internal pressures?
Podcast Guest:It's really both. They're both really powerful drivers. Externally, you've got intense market volatility, geopolitical uncertainty. It means CFOs need dynamic planning forecasting, not just looking backward.
Podcast Host:Right. It's more forward looking.
Podcast Guest:Exactly. And then there's ESG. Mhmm. Environmental, social, governance. That's massive now.
Podcast Guest:We're seeing something like 96% of CFOs saying, yes. Climate change is gonna impact our strategy.
Podcast Host:96%. That's almost everyone.
Podcast Guest:Pretty much. And then internally, companies are always chasing, you know, efficient growth.
Podcast Host:Mhmm.
Podcast Guest:Plus you have this huge complexity often from years of m and a activity. We worked with one global industrial leader, get this, operating with over 500 separate ERP systems.
Podcast Host:500? How do you even manage that?
Podcast Guest:Well, that's the point. It's incredibly difficult, like trying to use 500 different maps in 500 languages.
Podcast Host:Chaos.
Podcast Guest:Total chaos. And with the sheer amount of data flying around this data deluge Mhmm. It creates this huge push for transformation. You absolutely need that single source of truth.
Podcast Host:Okay. So the pressure's immense. How are companies actually responding? How are they, like, rewiring finance to cope?
Podcast Guest:Well, it generally rests on three pillars and then all depend on each other. First, modernizing the core tech. Migrating ERPs to the cloud is really key there for standardization, future upgrades.
Podcast Host:That makes sense.
Podcast Guest:Second, building a really strong data driven insight engine. And third, basically reinventing processes and how the finance team operates.
Podcast Host:Let's maybe zoom in on the tech part for a second. What's critical there besides just moving to the cloud?
Podcast Guest:Well, intelligent automation is a big one. It goes way beyond basic RPA, robotic process automation.
Podcast Host:Okay. How so?
Podcast Guest:Think of RPA like a simple script follower. Intelligent automation uses AI, machine learning. It can actually learn, adapt, even make some decisions. We estimate it could automate up to maybe 90% of standard accounting tasks.
Podcast Host:90%. Wow. So that frees people up?
Podcast Guest:Exactly. It frees up the finance professionals to do higher value analysis, strategic thinking. But underpinning all of this, as you said, is that single trusted source of data. Data governance is the absolute bedrock.
Podcast Host:Got it. So companies are investing in tech, changing processes. What are the results? Are we seeing real payoffs on the ground?
Podcast Guest:We are. Let's go back to that global industrial leader with the 500 ERPs. Yeah. By standardizing their data, implementing a cloud based shared services ERP hub, they cut their overall finance spend by 30%.
Podcast Host:30% reduction. That's huge.
Podcast Guest:It is. And they also sped up their financial close cycle by 25%. But it's not just cost savings.
Podcast Host:Right. There's more to it.
Podcast Guest:Definitely. Here's something really interesting. For the first time in about fifteen years, finance teams are now spending, on average, over 30% of their time purely on generating business insight.
Podcast Host:So less bean counting, more strategy driving.
Podcast Guest:You got it. They're moving up the value chain.
Podcast Host:That really is a profound shift. So what does this mean for the CFO, the person leading the finance function? Their role sounds totally transformed.
Podcast Guest:Oh, completely. From just a steward to a strategic adviser, a catalyst for change across the whole company.
Podcast Host:Which requires new skills, I imagine. Tech data.
Podcast Guest:Absolutely. Tech fluency, data literacy, and critically changed leadership skills. But there's a really significant risk here that often gets overlooked. Mandate misalignment.
Podcast Host:Mandate misalignment. What's that?
Podcast Guest:It's when the CFO's idea of their job, their priorities, what success looks like, doesn't match what the CEO or the board expects.
Podcast Host:A disconnect.
Podcast Guest:A major disconnect. Yeah. And it has real consequences. Nearly seven out of 10 CFOs leave their jobs within two years.
Podcast Host:Seven out of 10. That's incredibly high turnover.
Podcast Guest:It is. And almost half of those exits, 48%, are because of this mandate misalignment. Think about trying to run a multi year transformation project with that kind of instability at the top.
Podcast Host:Yeah. That's a huge challenge. Underscores the need for clear executive support, I guess.
Podcast Guest:Vital. Absolutely vital.
Podcast Host:Okay. So looking forward, we're hearing a lot about generative AI. Jenny AI, is that the next frontier for finance? The third wave?
Podcast Guest:It certainly looks like it, but it's important to see Jenny AI as complementing the analytical AI we already have, not replacing it.
Podcast Host:Okay. So how will it complement? What can it do?
Podcast Guest:Well, it could automate drafting financial commentary, maybe enhance forecasting by pulling insights from unstructured data like market news or sentiment analysis Yeah. Streamlining contract management, things like that.
Podcast Host:Interesting.
Podcast Guest:But maybe the biggest impact, radically shrinking the time to insight, moving finance away from just periodic reports toward a more continuous real time operating model.
Podcast Host:Continuous insight sounds powerful. Any downsides, risks?
Podcast Guest:Definitely. Caution is needed. You have the risk of hallucinations, Gen AI just making stuff up, basically.
Podcast Host:Getting things confidently wrong.
Podcast Guest:Exactly. And data security is paramount. You absolutely need a human in the loop for validation and secure private models to protect sensitive financial data.
Podcast Host:So human oversight remains critical. Alright. Well, you've just heard how finance and manufacturing is really transforming from a cost center to a strategic powerhouse, driven by external pressures, internal needs, and powered by tech, data, and strong leadership.
Podcast Guest:And that brings us to a really interesting question for you listening right now. If finance can start delivering these real time prescriptive insights, how might that level of agility change decision making speed and, well, the very nature of decisions in your own field? And maybe think about what new skills become super valuable as these capabilities spread.
Podcast Host:Definitely something to ponder as you continue your own deep dives. Thanks for joining us.