The digital transformation in the finance field has become an integral part of the corporate strategy: it is no longer just technological innovation but a real corporate revolution destined to be disruptive, i.e., an innovation (technological, business, method, etc. .) capable of changing the status quo of a market or an established business model.
The Keywords Of Finance Digital Transformation
There are four keywords that best describe the focus of finance digital transformation:
- Real-time
- Planning
- Prediction
- Modeling
When we talk about real-time finance, we think of the Stock Exchange, FTSE MIB, the raised hands, and the shouting at number 11 on Wall Street. Still, the same quantitative methods that underlie the technologies used in these almost mythological places are also being applied to aspects of the economic-financial sector. For example, in the economic sector, there can be important repercussions in the real-time acknowledgment of changes in market conditions: let’s think of financial maneuvers envisaged by recovery plans and business plans. These are based on considerations that derive from contractual provisions, which could change over time due to more or less predictable factors.
Strategies and such, frequently currently made with obsolete apparatuses, are occasionally surveyed; profiting in this period of advancements that offer investigation and results progressively because of incorporated devices would permit keeping away from monotonous and blunder inclined manual updates. With Open banking, a coordinated effort is imagined between innovation organizations and banks, which, through the APIs, are presently called upon to share client information, dependent upon their permission. Open Banking expects to work on monetary administrations by making them usable progressively from any place, liberating themselves from the actual office ( banking as a help).
Another objective is to guarantee that organizations in each area, through fintech, can offer extra monetary administrations by holding their clients and ensuring a superior client experience (credit arrangements, protection, ventures, and so forth). With open banking, we are in the tremendous field of implanted money. Installed finance, or coordinated money, is the monetary administration presented by organizations whose primary occupation is not the same as the monetary area. Providers keen on coordinated monetary administrations to supplement their proposition are progressively typical. A few models are portion installments and current records presented by online trade locales like Amazon and Shopify.
All this is part of the finance factory revolution that has now begun. We think of the Order to Cash or that process that deals with the distribution of a good or service, in the face of a collection, defining the steps to guarantee the transaction (request, quote, order processing, shipping, invoicing). Again we think about electronic invoicing that could guarantee a speeding up of the operations delegated to operational finance. In addition to the many examples that can be offered to understand further how a digital finance factory was reached, the cascading reflections of this disruption of the financial industry and the widespread extension of real-time need are easily understood.
Roles in the finance industry will change dramatically. Additional and widespread skills will be needed. The high degree of business and domain knowledge will be combined with an in-depth study of statistics, mathematics, and the consequent Modeling. Speaking of automation, machine learning and algorithms will prove almost redundant: ARIMA models, Forecasting, Maximum Weighted Independent Set, Blockchain, Fintech are captivating nomenclatures now known to attentive operators in the sector.
The real plus will be that these operators can interpret additional models compared to the more well-known ones, test algorithms, discuss the technicians’ technologies, and identify non-standard KPIs and insights. Prediction in the finance sector: we can no longer think that analyzes of this type or predictions on the subsequent Finance lockdown are left only to researchers torn from quantum physics, mathematics, or engineering, we need to review our flexibility mental in studying and understanding certain technical virtuosities that can also help at the level of functional analysis of the financial business.
