Carol Andrea Diaz is a public accountant with a Master’s in Business Management. She has over 24 years of experience, including 10 years in consulting at KPMG and EY, and 14 years in the real sector, specializing in shared services. Since 2017, Carol has been with Scotiabank, where she currently serves as Vice President of Finance for Colombia and the Dominican Republic, overseeing financial operations and technology support services within the Global Business Services division.

Introduction

Finance functions within Shared Services Centers (SSCs) must continuously evolve to keep pace with changing business environments. Regardless of a company's size, complexity, or regulatory demands, financial processes require constant advancements to enhance effectiveness and efficiency. In this article, we delve into the evolution steps necessary for finance processes within SSCs to maximize their potential and fulfill their role as innovation hubs.

Initial Centralization without Improvement

When financial processes are initially centralized within SSCs, they are often transferred as-is. This means there are limited or no improvements to the existing procedures, and the organizational structures are merely optimized for cost-effectiveness. This initial stage is common in captive centers, where process changes can take longer to implement compared to outsourced scenarios. The new team requires time to understand, share best practices, and centralize duplicated tasks using the same processes and technologies as before. While this approach might be acceptable initially, it falls short of the primary goal of SSCs: driving continuous innovation.

“Service centers must evolve by enhancing their processes through the implementation of advanced technologies, driving strategic insights and continuous improvement”

Transition to Improved Processes and Technologies

For SSCs to evolve, they must move beyond simply centralizing existing processes. Implementing significant improvements in processes and technologies is crucial. This can be achieved by:

  • Automation: Using robotic process automation (RPA) to handle repetitive tasks such as bank reconciliations and invoice processing. Automation not only reduces the time and effort required for these tasks but also minimizes errors and enhances accuracy.
  • Artificial Intelligence (AI): Leveraging AI to analyze large datasets, predict financial trends, and make informed decisions. AI can assist in optimizing investment portfolios and managing risks more effectively.
  • Streamlining Workflows: Redesigning workflows to eliminate redundancies and improve efficiency. This involves re-evaluating existing processes, identifying bottlenecks, and implementing changes that streamline operations.
  • Centralized Platforms: Utilizing integrated platforms for managing financial operations centrally. This ensures consistency in financial standards across all areas of the company and facilitates better coordination and control.

The target is clear: deliver more and better with the same or fewer resources. Finance teams should collaborate closely with technology.

Financial Trends for 2025

Looking ahead to 2025, several key IT trends are expected to shape the landscape of financial operations. Staying ahead of these trends will be crucial for SSCs aiming to maintain their competitive edge.

● Adoption of Blockchain Technology: Blockchain is set to revolutionize financial operations by providing enhanced security, transparency, and efficiency in transactions. SSCs can leverage blockchain to streamline cross-border payments, reduce fraud, and automate contract enforcement through smart contracts.

● Expansion of Artificial Intelligence: AI will continue to evolve, offering more sophisticated tools for predictive analytics, fraud detection, and customer service automation. Advanced AI algorithms will enable SSCs to gain deeper insights from financial data and improve decision-making processes.

● Integration of Edge Computing: Edge computing will become increasingly important as SSCs handle larger volumes of real-time data. By processing data closer to its source, edge computing reduces latency and enhances the speed and reliability of financial operations.

● Focus on Cybersecurity: With the increasing digitalization of financial operations, cybersecurity will remain a top priority. SSCs must invest in advanced security and continuous monitoring to protect sensitive financial information. This requires investing in technology and ensuring human resources are well-prepared.

● Emphasis on Sustainability: Financial IT will also see a growing emphasis on sustainability. SSCs will adopt green IT practices, such as optimizing data center energy usage and implementing eco-friendly software solutions, to reduce their environmental impact.

By staying informed and proactive about these emerging trends, SSCs can continue to innovate and thrive in the dynamic financial landscape of 2025 and beyond.

In conclusion, service centers must evolve by enhancing their processes through implementing advanced technologies. These technologies should aim to automate repetitive tasks, gather data, and present organized figures to specialists. This transformation will facilitate a deeper focus on variance and trend analysis, thereby transcending mere operational activities and driving strategic insights and continuous improvement.