The importance of digitizing financial processes

Digitizing financial processes is a necessary maneuver in the digital transformation that has been taking place for a couple of years; it was enhanced in the last year due to the scenario that the Covid-19 pandemic is leaving us.

At a time when, under the legal framework, telework modality is being imposed in a wide variety of professions and business positions, those responsible for accounting management realized that the resources they usually used to control finances were no longer available. 

The financial area of any company fulfills various functions. It is made up of a set of activities aimed at achieving the objectives of safeguarding and investing securities and resources, maintaining the appropriate information systems for the control of assets and operations, and, in addition, protecting the capital invested.

The ways of working in these areas continue to depend mainly on paper and the manual execution of processes. It is usual to receive and issue invoices and expenses through email, which sometimes must be approved by several employees to then incorporate them into the accounting system.

This task is time-consuming and requires accuracy so that all receipts are recorded and facilitate bank reconciliation.

To streamline the control of the economy of companies and favor, at the same time, their organization, it is advisable to resort to digital financial management systems that allow you to digitize financial processes. Its application helps reduce the time you spend on traditional processes, reduces the use of paper, improves productivity, and eliminates errors thanks to the automation of most tasks.

What is the importance of digitizing financial processes?

In the first place, let us agree that, in a technological era where the most important digital transformation of recent years took place, a company that does not automate its processes has a serious chance of becoming stagnant and not meeting the growth objectives it sets for itself.

This happens because it is well known among the great executive leaders of successful companies that a digital tool is a technological solution that makes the execution of tasks normally carried out manually more flexible. However, some companies resist, either due to ignorance or getting used to their comfort zone, to undertake the task of investing in technology, even when they have to work twice as hard.

But the truth is that they ignore many of the benefits that digitization could bring to business optimization. In the area of finance, especially, digitizing financial processes will help you strategically position yourself for decision-making in your business.

For this reason, when we talk about digitizing financial processes, we think in terms of solutions, not technologies, solutions that add value, because basically, it is the technology that must be put at the service of companies and not the other way around.

So, in summary, what additional benefits can digitize financial processes bring you by implementing a financial management tool? We explain it to you below.

• Provide updated, accurate, and real-time information on numerical business data

Digital financial management tools, thanks to their various functionalities, facilitate the execution of many tasks because they allow you to update company information in real-time without having to upload new data. This is possible because the new financial operations are automatically loaded into a database.

• Centralize accounting information through efficient financial management solutions

As we pointed out earlier, a good financial management tool will not only help you digitize financial processes in a practical and fast way but also, by saving the information digitally on a single platform, you will be able to access it easily without endless searches in spreadsheets. In other words, forget about having several tabs open to calculate the income and expenses of your financial costs.

• Have a global vision of the business that allows for better decision-making

In addition, as you will be able to obtain the numerical information you need by opening the database, you will have at your fingertips directly all the collected values that will allow you to carry out comparative analyses, month by month, year by year, to guide financial decision-making.

The purpose of this digitization is to achieve a concrete vision of the usual financial movements and thus be able to conscientiously allocate the resources corresponding to each operation: investment expenses, transfers, production supplies, etc.

In short, technology and shared information are two factors for competitiveness because they neutralize the inefficiency of many processes in which unstructured and unrealistic information is used.

And the best way to achieve this is by using connected, shared, and reliable data, through the appropriate management solutions to digitize financial processes, an action that directly impacts productivity and the flexibility necessary to operate with maximum performance in a context as competitive and fluctuating as the current one.