CFOs Look Outside Their Silos To Optimize Order To Cash Flows

It’s been about six months since Alan Lacan came on board the Paris-based payments technology firm Limonetik as its chief financial officer – and after months of remote working, the firm is gradually welcoming back some team members to the office.

Work-from-home mandates became a key motivator for CFOs of all different kinds of companies to embrace digitization and support a remote workforce. For some firms, embracing new technologies became a matter of business continuity, with new tools implemented at a dizzying pace – and without much thought as to the purpose those solutions would serve in a post-pandemic market.

But for Alan, the solutions put in place even before he came on board won’t fall by the wayside as more staff come back to the workplace.

“Everything we implement, in terms of automation [and] new tools to collaborate for specific projects, we want to keep,” he recently told PYMNTS in its latest Voice of the Digital-First CFO discussion. “We are trying to implement some very long-term solutions, as we don’t know what tomorrow will bring.”

As a CFO, the decision to integrate new technologies isn’t merely about how to mitigate risk in the moment. It’s also about safeguarding the enterprise from future disruptions – and remaining agile and resilient ahead of the next major event.

Everything Is Connected

First on the agenda for Alan when he came to Limonetik was to familiarize himself with the staff, the firm’s technologies and the current landscape of the back office. As a technology firm, things can change quickly, he said, and it’s important to understand how all workflows are connected across departments – and often flow back to the CFO.

“At the end of the day, everything flows back to finance,” he explained.

Demonstrating that finance-focused, interconnected nature of many back-office workflows, Alan highlighted the order-to-cash cycle as a key priority when identifying opportunities to digitize and optimize. The O2C workflow is rooted in accounts receivable (AR) and, naturally, relates heavily to finance. Yet it also has a strong connection to the customer relationship.

Understanding how each point in the O2C flow is intertwined – from processing customer orders to payment collection and cash application to identifying the opportunities to improve the workflow through technology.

Payments became an important focal point in this regard. While paper checks remain rare in France’s B2B payments landscape, wire transfers, though digital, do not support an elevated level of automation for key O2C processes like reconciliation. Alan is now looking at how to facilitate integrated payment processing within the company’s own platforms, negating the need for customers to toggle between Limonetik and their banking portals to pay an invoice.

Such a modernization effort also impacts a variety of areas in the back office, from streamlined accounting to an improved customer experience. And moving forward, Alan noted that accounts payable (AP) and B2B payment flows will be the topic of modernization efforts that can support enhanced accounting, budgeting and forecasting through technologies like artificial intelligence (AI).

Working Together 

When digitization strategy touches so many areas of the back office, it is important for CFOs to develop a deep understanding of departments and personnel beyond the finance team. Adoption of technology rarely occurs in a vacuum. On the contrary, tools can affect the workflows of a variety of departments, so it is important for the CFO to take the lead on ensuring that new solutions can seamlessly integrate with each other – even if that CFO is not an expert in technology.

Taking that diligent, cross-department approach to modernization will continue to be imperative as more professionals return to the back office. While many firms can struggle with disruption, Alan noted that Limonetik’s technology-centric nature makes it an enterprise poised to embrace change.

But CFOs and other finance leaders cannot negate the human approach to modernization. When “everything flows back to finance,” it’s the CFO’s job to ensure that any automated tool can actually make life easier for professionals in multiple departments. Keeping tabs on emerging trends in finance and payments technology means finance leaders can be as savvy as they need to be when choosing which solutions will be most effective in meeting their goals. That includes ensuring that any tool implemented can positively impact everything from AR and AP departments, to sales and customer relationship managers, to IT and beyond.

Taking the time to understand each department’s needs – and approaching modernization at an enterprise-wide vantage point – enables CFOs to ensure that digital disruption yields positive outcomes.

“You have to keep in mind that each department has a different road map,” said Alan. “They have their own priorities. You have to make sure there is no friction in working to achieve a common goal.”