Finance used to be a function expressed in the past tense. Our job was to analyse how the business performed, what happened, what went right and what went wrong. Delays back then were routine and expected. Today, businesses need to get ahead of the curve to compete and stay competitive.
As a CFO of a global payments company, my view is that competitive advantage can be achieved by having the best possible payment infrastructure to evolve as quickly as your business does. Payment is the oxygen of any business. It is the vital final interaction with your customer after they have bought into your brand and product. The payment process must be instant and seamless to ensure a fulfilled shopping experience and to encourage your customer to shop with you again. For your business, the payments process brings customer knowledge, cash optimisation, visibility of big data and real-time information to help make commercial decisions.
The canvas on which we trade is growing. Businesses are global. It doesn’t matter how large or how small you are. Some aspect of your trade, whether you like it or not, will be driven by something – or many things – going on, on the other side of the planet. It might be a key component supplier, or customers, or simply the generalised effects of the global economy. There may be fervent debates about borders raging in many parts of the world, but the truth is that business knows no borders. Customers expect to be able to shop seamlessly across them.
The role of finance in the face of all this change and all this competitive pressure is to enable the business to find incremental competitive advantages as fast as possible. That advantage is measured in fractions of seconds.
In global financial markets, trading has become so competitive and data-driven that banks and hedge funds invest millions in shaving milliseconds off the time it takes to buy and sell shares. Today, that advantage is available in payments. Make it as easy as possible for a customer to transact securely without queueing and you instantly grant yourself an emotional and practical advantage over your competitors.
The empowered CFO
The transformation in finance is a bit like stepping inside a time machine and racing forward. The language for CFOs with the best technology and the best teams is about what is happening now in the business, how we are performing and vitally, how we are going to perform in the future. Through real time visibility on cash flow and trends, CFOs are empowered and have a more commercial role to steer the company to make the best business decisions based on revenue streams.
Much of this is aided by the vast improvements taking place in payment technology. All businesses have to go to great lengths to meet customer expectations; at the same time, they need to reduce the time it takes to accept payments and record them. Money, like music and film, has become largely digital. The probability is that many millennials will have never written a cheque and never will. Coins and notes feel increasingly quaint in the face of contactless payments. There is a proliferation of mobile apps, and cards are now routinely used over cash.
Omni-channel payment solutions now link the brand experience with all the different types of payment methods – including touch, tap, fingerprints, apps – to deliver a unified customer shopping experience. These systems are designed to help customers’ make payments in exchange for products and services – securely, quickly and with minimal inconvenience.
Behind the scenes, the improvements in payments are even more profound. Transactions feed through instantly to back office systems linking revenue data to accounting systems making reporting incredibly efficient. Access to customer data about who, where, when, how much and, (with the customer’s permission in the wake of GDPR) provide valuable insights into customer habits and spending patterns. Shared data and shared intelligence make for better forecasts and much better business decisions.
There’s so much more that you can do with this data. You can see, for instance, what the trading patterns are. If you’re a restaurant business or a retailer or a hotel, you have access to a comprehensive understanding of when your trading peaks are. When do most customers settle their bills in your restaurant? When do most customers buy a certain product from you?
When do most guests check out from your hotel? You can make intelligent decisions about staff requirements, forward orders and more. And with the right payments partner, over time you can gain a better understanding of how your business is benchmarked against the competition. We need to use data where we can to stay competitive and to win.