Disrupted Finance. Where does your BlackLine investment fit? In The Black 2019

Transcription

1 Disrupted Finance Where does your BlackLine investment fit? In The Black 2019

2 Cloud R2R technologies cover the R2R process - How we have thought about BlackLine Close & Reconcile Subsidiary Ledgers General Ledger Close Financial Consolidation Month End Reporting Finance & Accounting Governance Level 2 Process Group 1.0 Close & Reconcile Subsidiary Ledgers 2.0 General Ledger Close 3.0 Preliminary Financial Statements 4.0 Financial Consolidation 5.0 Month End Reporting 6.0 Technical Accounting 7.0 Manage Process 8.0 System Maintenance Level 3 Process 1.1 Close/Cut-off transaction processing 1.2 Close Transaction Systems Subsidiary Ledgers 2.1 Process Journal Entries 2.2 Process Allocations 3.1 Review Trial Balance 3.2 Review Preliminary Financial Statements 4.1 Transfer & Reconcile G/L to the Consolidation System 4.2 Process Currency Translations 5.1 Prepare Consolidated Financial Statements 5.2 Prepare & Distribute Mgmt Reporting 6.1 Perform Accounting Research 6.2 Scan external environment and engage standards setters 7.1 Develop Close Calendar & Monitoring Process 7.2 Develop Close Policies, Procedures, Standards & Templates 8.1 Maintain System Interfaces 8.2 Maintain Chart of Accounts 1.3 Transfer Sub-ledger Data to General Ledger 2.3 Process local tax calculations and journal entries 3.3 Process Management & Corporate Adjustments 4.3 Process Intercompany Eliminations 5.3 Executive and External Reporting 6.3 Develop Accounting Issue Identification & Monitoring 7.3 Develop & Maintain Internal Controls 8.3 Manage business rules and Master Data 1.4 Reconcile Sub-ledgers to General Ledger 2.4 Perform Reconciliations 3.4 Perform Financial Close Analysis 4.4 Process consolidated adjustments 5.4 Prepare Notes to the Financials 6.4 Disclosure Management 7.4 Issues Tracking & Resolution 8.4 Perform System Updates 3.5 Close General Ledger 4.5 Run tax calculation & process consolidated tax journal entries 5.5 Prepare Statutory Filings & Shareholder reports 7.5 External Audit Management CRRT Functionality 3.6 Perform Financial Close Forecast 4.6 Close Corporate Consolidation Ledger 5.6 Prepare & Distribute Regulatory Reports Journal Entry module Account Reconciliation Intercompany Hub Close Cycle Management Financial Reporting 7.6 Evaluate & Implement Improvement Opportunities Standardize & Optimize Process Transformation 2

3 Blackline s View of Its Piece of the R2R process Data Sources ERP Bank Statement General Ledger Point of Sale Open Items Clearing Transaction Matching Matched Items Unmatched Items Automated Journal Definition Create Automated Journal Entry Journal Entry User Entered Journal Entry Other Exception Handling Functionality Ability to handle exceptions for analysis Create Supportin g Items Allocations & Look-up Tables BlackLine Connector Account Reconciliatio ns Periodic Reconciliations Journal Approval Process ERP 3

4 Where does BlackLine fit into the big picture (example) Client Perspective Procurement Owned Finance Owned Applications Ariba Spend Visibility Hyperion Planning HFM Global Cognos BI Ariba BBR Global Data Warehouse Legal Owned GFDM / BFDM Blackline Regional Data Warehouses Compliance - Grants & Contract JDE HR Owned GetPaid PeopleSoft JDE Bolt-ons / Workflow BAM Supply Chain Owned Demantra Pega Apps Specialized Tax Applications SpendTracker LeasePak R&D Owned Concur Quantum imany SPM Key non-finance owned applications important to Finance Manufacturing Owned Manufacturing Cognos Wise Hardware Tracking 4

5 What are CFO s digital and technology concerns today? The finance road map of the future is paved with disruptive technology Disruption Impacts Business model disruption Accelerating innovation, competition, and new platform models are challenging incumbents to rethink the art of the possible and existing models. Operating model disruption Finance organizations must harness emerging technologies and disrupt itself. 57% are concerned that their organization does not have the sensory capabilities and innovative processes to respond to rapid disruption 61% are concerned about integrating cognitive processes and artificial intelligence 49% are concerned about the integrity of the data on which they base decisions 45% say they are not leveraging digital as a means to connect to their customers effectively Source: US CEO Outlook 2017 survey: Disrupt and grow offers insights into the greatest concerns of CEO s and how they plan to mobilize for the fourth industrial revolution. Findings based on a study of the 3-year outlook of nearly 400 US CEOs, with annual revenues greater than US $500 million; 32% have greater than US $10bn in revenues. 5

6 Extreme automation will invert existing paradigms Disruptive technologies such as Cloud Record to Report (R2R) technologies is a part of extreme automation and can help to invert the knowledge-work value distribution and challenge existing delivery models Finance Capabilities Insight Delivery Cognitive and Analytics Current Knowledge-work Value Distribution Future Knowledge-work Value Distribution 70% reduction in human labor driven by extreme automation Extreme automation will empower the finance workforce to add more value, at rapid speeds. Data Normalization and Governance Foundational and Transactional Cloud Record to Report technologies will dramatically impact the bottom two layers of the Capability Framework. 6

7 Disruptors will fuel the next wave of finance transformation Finance of the Future architectures combine many, if not all of these technologies. Data management Progressive data management and mining of untapped data sources will create a springboard for elevated discovery agility and prescriptive insights Blockchain Augmented information authenticity will enhance security, shorten transaction cycle times, and eliminate the need for reconciliations, for good Finance Architecture Machine learning Boost foundational automation by deploying adaptive technologies to make fact-based decisions that will eradicate manual segments of the process sequence Cognitive Electronic brains will challenge the accounting opinion, perform the scorekeeping and provide deep analytics, humans will drive dynamic insight generation Cloud ERP, EPM, CRRT Architect best-in-class application solutions and standardize end-to-end global processes, once and for all Robotic process automation Rapidly scale and dramatically reduce finance workeffort through elimination of repetitive, rules-based processes that require human intervention today Natural language processing Unconstrained information accessibility from unconventional sources, will allow finance to positively influence business outcomes, in real-time Digital analytics and delivery On-demand, customized insight delivery will enable finance to transcend the role of historical scorekeeper and become a strategic interpreter 7

8 Every company s journey will be different, but how do you leverage your BlackLine investment all along the way? Technical maturity Leading practice Immature Cloud ERP, EPM, CRRT Data management Near term Robotics Machine learning Disruptor enabled maturity Cognitive NLP Digital analytics and delivery Medium term Full use of BlackLine applications (beyond your first implementation) in key R2R subprocesses Blockchain Term of pervasive finance adoption Size of circle depicts independent benefit derived from disruptor. Impacts and adoption predictions will vary based on industry, geographic markets, etc. Long term What should you consider? Taking advantage of the full automation capabilities of BlackLine Push BlackLine functionality upstream in the R2R process Leverage BlackLine functionality outside the close calendar Incorporate the functionality of BlackLine as a value added component of your extreme automation Finance architecture. What does your design look like? 8

9 Example #1: OTC trade promotions solution leveraging BlackLIne upstream CPG and retail companies spend an enormous amount of time and effort managing trade promotion payments and deductions: Average spend on trade: 15 to 18% of sales 80-90% of traditional CPG promotions settle thru deductions Median time to resolve deductions: 90 days Deductions represent 2 to 4% of outstanding receivables on average Estimated 7% of deductions are invalid and results in revenue leakage Trade Promotion Spend Illustrative Example Contract & PO Contract & Invoice Proof of Delivery Goods Receipt Note Remittance Advice Payment Advice Order to Cash Solution Buyer Order status Purchase Order Supplier Trade Promotion Solution Supply Chain Visibility Solution Logistics Transpor t Intercompany Solution Invoice Buyer Invoice Payable Solution Payme nt Dispute Management Solution Dispute / Collectio ns Bank Supplier 9

10 Example #2: Invoice/rebate architecture Leveraging BlackLine Upstream Alteryx Blockchain Blackline Machine learning RPA Digital analytics. Architecture and data flow for illustration only and is not intended to represent the exact current state. 10

11 Gain value in your BlackLIne investment beyond basic R2R 11

12 Thank you Contact us Ralph Canter Advisory Managing Director, St. Louis, MO James Phelps Advisory Director, Atlanta, GA James Murphy Advisory Managing Director, Santa Clara, CA Bruce Ruberg Advisory Director, Phoenix, AZ Brian Yeager Advisory Managing Director, Cleveland, OH

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