Finance professionals increasingly rely on data-driven software to manage complex organizations, whether making better sense of supply chains or using artificial intelligence to enhance forecasting. But software is itself constantly in-flux, requiring adept financial management from skilled CFOs. That is why this month I spoke to the CFOs of two different software platforms, asking them about the implications of software for finance professionals in general and what issues the finance function faces in this sector.
With the rise in global economic tumult, due to the Covid-19 crisis, the need for seamless, technology-enabled solutions to manage global supply chains has never been more apparent. I recently spoke with Sarah Dickens Spoja, CFO of accounts payable software provider Tipalti, about her company’s role in helping finance leaders navigate uncertainty and ensure timely, secure processes for paying global vendors. More broadly, we discussed how automation is impacting the finance function, what skills today’s finance professionals need to succeed, and how a commitment to digital solutions is key to surviving sudden crises like Covid-19.
Jeff Thomson: Tipalti offers its clients ease with global payables operations, paying to 190 countries with 120 currencies. Given the current worldwide pandemic, why are software solutions like Tipalti critical for business continuity? What challenges to CFOs does it help address?
Sarah Dickens Spoja: Paying suppliers and doing it well is critical today. The global economy is an interconnected ecosystem. If your business is one that relies on other companies for goods and services to deliver your offerings, you need to have a stable supply or service chain. The only way to secure that is reliably paying them.
One of the best examples of the great need of a solution like Tipalti comes from a new client that explained during the sales process about how they had to print a packet of outbound checks from the office, then drop them off to the CFO’s house to sign, and then had to mail them out individually. That’s a payment run that is both inefficient and highly risky. That payment run is a spilled cup of coffee away from a series of late payment notices from angry suppliers and, which is worse, wasted hours of the AP manager’s and CFO’s time.
Without automation, AP is sluggish and time-consuming. It is especially challenging in a remote workforce, where invoice and payment approvals are occurring in a separate place from the rest of the firm’s payables operations.
With an automated, cloud-based solution, it doesn’t matter if an organization’s employees are at home or in the office. There is 24/7 access for finance, buyers/approvers and suppliers. And because every step and element of the transaction is tracked, it’s fully controllable and auditable, reducing risk and financial exposure for the company.
Tipalti happens to be unique in how global-ready we are. So, in addition to supporting domestic AP, we’re able to streamline cross-border payments, help with multi-entity and multi-subsidiary structured workflows, and actively support currency conversion at various points where the business needs it. Today’s growing companies need this robust set of functionalities in the financial operations to scale and grow without disruption.
The CFO has an important role in analyzing the impact of an economic crisis and how it could impact the near term and longer-term outcomes for the business. This includes everything from forecasting key metrics to updating budgets and securing financing where required. Employees want to see that their management team is making the decisive actions needed to protect the business in time of disruption, and being able to provide transparency into that decision-making process and the state of the business wherever possible can help to foster more trust.
Thomson: Automation has been a driving force in the finance field for years and has the potential to unlock enormous productivity. How do you think automation is transforming the finance function and what do organizations need to do to encourage it? How has it improved your own company and other organizations for which you’ve worked?
Dickens Spoja: While automation has been around for years, a lot of it was to solve a specific pain point. For example: keying in invoices is a time-consuming job. So there are tools for that. But you still had to make additional manual processes to connect several automated processes together.
We’re now into a phase where automation is transforming the finance function by successfully streamlining the payables workflow in a more holistic sense from start to finish. We’re looking to technology that reduces the reliance on lots of point solutions and instead is looking at connecting all those steps together, so you minimize friction and gaps while simultaneously adding controls, AI, scalability and auditability. By bringing it into one holistic cloud platform, finance teams can easily manage their entire AP and supplier payments operation.
The potential for automation was already being realized before the pandemic as finance teams relied on the technology to greatly improve their productivity. Automation had, in effect, become a must-have function. But it is doubly necessary in the current climate, a situation in which employees and finance teams are dispersed and unable to work under one roof. Time matters; organizations cannot afford to waste days or weeks on mundane payables tasks. And that is one of the many reasons why automation is so important.
At Tipalti, across the business we are evaluating the technologies our teams are using to ensure they are the right ones. Where a manual process exists today, we are looking for ways we can digitize and automate it to be more scalable and adaptable to our current work environment. For the Finance Tech Stack, I believe a strong AP Automation platform, along with an integrated ERP and Billing solutions, are crucial for any mid-market business, and more so now than ever as Finance teams are working remotely and need a digital solution for vendor management, invoice approval processes and electronic payments. Tipalti is the leading Payables Automation platform and this is what we are hearing from our current clients as well.
Thomson: Given your technical background in mathematics, and the need for future finance professionals to have greater knowledge of data analytics, how much math is too much and how much is too little? Should finance professionals know statistics? What about computer coding at the applications level?
Dickens Spoja: Perhaps a story of where “too much math” fails would be helpful here. Early in my consulting career, I built an analysis for a management presentation that showed sales over time for my client for a particular product portfolio. It showed the 1st and 2nd derivatives of the curves were changing and the implications of this on their new product innovation cycles. I presented the slide and was hoping for a great response but didn’t get one. [What I learned was] that if something needs calculus to be explained, there is probably a more straightforward answer that is more compelling and can drive more and better action. Being more direct is better.
I often joke that I use very little of my Mathematics degree in my career. Some of my favorite classes, like Abstract Algebra and Number Theory, are not topics that are needed as a finance executive day-to-day. However, the other way to think about it is that I use the skills taught in my math degree every day. Learning how to think critically and logically to prove a complex math theorem is how [you train your] mind to think critically about all problems and challenges that may come your way. It helps you break down larger complex tasks (like building a forecast model) into discrete analytical projects that can be solved and then built back together to answer the bigger, more challenging questions.
My biggest regret is not taking computer science classes or learning how to code in college. These skill sets are very valuable. [That’s the] advice I give to people…who are in high school and college now. Being able to think like an engineer around database structures and even basic tools like SQL are valuable in the finance field and can make you stand out from the crowd.
Thomson: During this year’s Covid-19 crisis, you were placed in charge of your company’s pandemic-related policies, a good example of how CFOs are being tasked with more complex tasks outside the traditional confines of the finance chief role. Can you discuss what crucial decisions you made as this crisis unfolded and what skills – both financial and non-financial – you had to draw upon to navigate this unprecedented challenge?
Dickens Spoja: Remote work hasn’t changed my duties, but how I accomplish those duties has certainly changed in regards to levels and types of communication, frequency of check-ins (across my peer group, to the CEO and to my direct reports), and the importance of prioritization to ensure that everyone is aligned on the key priorities of the team and working together even while apart.
I am very encouraged as to how our entire company has stepped up during this unique circumstance and adapted to these changes while also being supportive of each other. That said, it’s only possible to be productive and maintain seamless communications because we used cloud-based technologies up and down the organization prior to the shelter-in-place orders. If you’re a finance team with any kind of paper-based process, the disruption from remote work would be very impactful.
Tipalti has also spent a lot of time understanding what our employees think about working from home, the good and the bad, and being agile enough to adjust. We have surveyed our employees and responded to feedback. As we move past the 6-month mark of working from home, continuously improving and gathering that feedback is important.
This article has been edited and condensed.