As global competition intensifies, companies regard continuous operational streamlining as vital to their competitiveness. Financial administration professionals are also expected to engage in the continuous streamlining of operations. Many organizations have outsourced their basic financial administration functions, and global service centers are proliferating in low-labor-cost countries.

While streamlining their processes, financial functions are also expected to make a deeper and more strategic contribution to supporting and developing business activities.

Toward Digital and Automated Financial Administration

Increasing digitalization has rapidly transformed the world of business. It has created new types of service and business models as well as new, unprecedentedly effective methods and tools for value creation.

Digitalization has also transformed financial management functions and markedly reformed practices. The pace of change is ever-increasing. The proliferation of automation and software robotics has accelerated data management, simplified transactional operations, and greatly reduced the risk of human error. Digitalization is enhancing core financial administration functions and improving accuracy and quality. Processes that are independent of time and place have made working more flexible.

The digitalization of financial administration and the automation of many basic tasks can be a daunting prospect for financial managers. On the other hand, digitalization is creating opportunities for financial administration professionals to use their expertise to solve new, complex problems, thereby generating more value for businesses. Wherever the automation of financial administration reduces manual labor in routine tasks, it will free up resources for the analysis and integration of data, while enabling a genuine focus on supporting business operations and evaluating new commercial opportunities.

What this also means, however, is that pressure is mounting to develop the skills and competencies needed to succeed in this new role. Automation is leading to major changes in the job descriptions and skills required of financial managers and professionals. A new way of thinking and openness to adopting new practices and new ways of working are needed. Both organizations and individuals are responsible for developing processes and know-how to meet the growing expectations directed toward an organization’s financial administration function.

New Competence Requirements for Financial Administration

As the role of financial administration changes, job descriptions and skills requirements are being transformed. A key skill is the ability to understand the relationship between financial performance and the performance of various business functions. This requires closer cooperation between financial administration and other business units, in which the financial administration expert primarily supports decision-making, operational coordination, and management.

No longer a mere producer of reports and knowledge for decision-makers, the financial function has become an active user and interpreter of information. The focus is shifting towards the perception and analysis of future opportunities instead of reporting historical data.

A growing number of international rules and regulations are arising with respect to financial administration and financing. Financial experts must be able to upgrade their skills and knowledge of topical issues concerning matters such as taxation, transfer pricing, sustainability reporting, and international accounting standards.

While the perception and understanding of financial risks involve the mastery of regulations and international legislation, other business risks and their management are receiving greater emphasis in the everyday work of financial and financing experts. To prevent unpleasant surprises, in addition to identifying business opportunities, financial management needs to spot potential risks and uncertainties that may disrupt business activities. This requires skill upgrades, the active following of trends, and the monitoring of international economic cycles and political developments.

As the role of the financial function becomes more strategic, financial managers and experts will need deeper business know-how and a broader vision of commercial success factors. Numerical skills are no longer sufficient; deeper insight is needed into the hidden causes and effects behind financial figures, as well as the formation of phenomena such as customer value.

For the modern financial professional, competencies such as teamwork, interaction, communication, and networking skills are growing in importance. Financial experts need to collaborate with other departments and colleagues in gathering and analyzing the relevant data from multiple sources. The ability to distinguish essential information from the wealth of data, summarize I,t and present it intuitively and persuasively to decision-makers and colleagues is taking center stage.

The financial administration department is like an internal service provider whose task is to promote and support the