Considerations for Building a Digital Controllership

As finance and accounting teams work to harness innovation and technology to fundamentally transform their organizations, many are focusing on how the controllership role can evolve and add greater value to the company and its stakeholders. World-class controllership functions strategically leverage technology to improve the efficiency and effectiveness of operations, manage risk, control costs and help drive enterprise performance.

In fact, a recent Deloitte Center for Controllership poll of more than 1,700 finance, accounting and other professionals found that 52.8 percent are planning digital controllership activities that include leveraging process automation, analytics as well as other technologies to improve productivity, controls and job satisfaction.  

For those looking to improve upon or expand their organizations’ digital controllership programs this year—whether through the implementation of robotic process automation, cognitive computing, blockchain, or analytics—there are a few things finance professionals should know and understand to help guide the controllership function in the year ahead. 

Discern which technologies fit your organizational needs

Disruptive technologies gaining favor with controllerships can focus on discrete or overlapping challenges. But, they can also help reduce labor-intensive tasks, reduce human error, broaden data sets and tighten internal controls. To hone in on the right program, identify the areas where new technologies can most benefit your organization by exploring the enablers that align with those needs and focusing your efforts on where improvements can be made. 

Some solutions helping propel the controllership function’s digitization are: 

• In-memory computing -  With ever-growing computing power consistent with Moore’s Law, financial software companies are rewriting their platforms and moving from the constrained ledger to sub-ledger construct of old to an obese ledger capable of speed-of-thought analysis and reporting (yes, management reporting too!). This is likely the most significant technology advancement for finance and accounting since the invention of enterprise resource planning software. 
• Enhanced finance automation (EFA) – These established products extend your core financial systems, automating standard and routine processes across the “close to report” cycle by leveraging purpose-built technology with built-in controls. If intercompany accounting, manual journal entries, close tasks and schedules and account reconciliations are dragging down your department – this may be a good place to start. 
• Robotic process automation (RPA) -  Bots in the accounting department? Absolutely.  Robots built within highly capable software applications can perform “swivel chair” activities by accessing your financial systems, spreadsheets, email and other sources to automate routine and often error-prone work. Logic and business rules provide guided pathways for these bots.  However, you shouldn’t discount the internal controls and monitoring required to avoid high volume mistakes. 
• Cognitive computing — Artificial intelligence technologies—configured to help systems “think” like humans by adapting to non-routine, industry and organizationally specific needs—can add a strategic element to risk-sensing and reporting capabilities.  Cognitive computing can help controllers combine financial information with unstructured data sets to unearth insights that would otherwise be too time-consuming or costly for humans to source.
• Visual analytics — Rendering big data from myriad sources into consumable dashboards and other reports can help users discover trends, anomalies and other new insights they might be unable to see quickly otherwise. 
• Blockchain — This digital ledger technology enables users to record transactions or any digital interaction among a network of trusted participants in a way that’s secure, transparent, auditable, efficient and highly resistant to outages.  Blockchain also has the potential to fundamentally alter existing finance and accounting processes. While blockchain is in the early stage of adoption by many finance and accounting professionals, it represents a game-changing technology that should be considered early and often in strategic finance and accounting plans.

Manage risks unique to digital controllership functions 

Taking shortcuts while leveraging new technology in a digital controllership can cause more harm than good. Solutions that automate or remove human oversight require careful design, deployment and monitoring.  When shortcuts are taken, programs risks increase considerably. 

Strategic planning prior to implementation of digital controllership programs can help companies achieve effective change management, scope control, strong project management and a risk management foundation that reduces errors and inefficiencies.

Teams developing or expanding digital controllerships should work to manage common risks in areas including:

• Controls and Compliance – Deficiencies in design or development, insufficient testing scenarios and a lack of automated monitoring can lead to control weaknesses or even financial errors impacting statutory and regulatory reporting.
• Multiple Versions of the Truth – Analytic solutions rely on accuracy of source data that often lives in many places. Detrimental decisions can result from poorly designed analytics and can stem from both internal and external information stores.
• Digital Workforce – Human AND digital associates will quickly be working side by side. Programs lacking role clarity, human oversight and automated monitoring stand to yield hazardous results. Education, planning and disciplined execution are hallmarks of an effective workforce migration.

Digitizing finance and accounting processes can be a massive, strategic undertaking.  To help your controllership reach its full digital potential, invest the time and attention to achieve impact while effectively managing the risks.

Kyle Cheney and Dave Stahler are Deloitte Risk and Financial Advisory partners with Deloitte & Touche LLP, who serve on Deloitte’s Digital Controllership leadership team.