The stakeholder capitalism movement has accelerated in 2021. Investors, employees, and communities are looking for companies to deliver more transparent information about how they operate and forcing the question, “Why are you in business, and what is your purpose?” This includes a company’s commitment to the environment, society, and good corporate governance, as well as how environmental, social, and governance factors impact its operations and values.
With this focus on transparency, CFOs and their finance teams are focused on closing the books and reporting results quickly, to get financial information into the hands of investors and other key stakeholders in a timely manner.
Yet speed isn’t the only consideration. While it’s unquestionably a goal of all CFOs, the quality of information that’s reported to investors and other stakeholders looking for insights into a company’s growth potential, customer sentiment and momentum, corporate purpose and values, and its resiliency in an uncertain economic environment is also a key consideration.
At Workday, we believe two key questions finance leaders should ask are, “What more should finance expect from a cloud provider, and what does true excellence really look like?”
In this Q&A, Terrance Wampler, general manager, Workday Financial Management, looks at what CFOs should be expecting from their cloud vendor, and why speed alone is not the only answer when it comes to closing the books.
What should finance be focused on when it comes to key tasks such as closing the books and filing?
Let’s take speed out of the equation for a second and focus on depth of information instead. There are several factors that determine when a company files and reports earnings; speed is one, but the substance of the report and the earnings call are a better gauge of the quality of close and overall strategic direction.
In recent Workday earnings calls, you’ll see that Workday’s leadership devotes their time to highlighting strong pipeline and bookings growth, industry and market momentum, new customer wins, key product investments such as Workday Adaptive Planning and our offerings for analytics, spend management, and employee engagement, and finally showcasing our ability to get customers live and happy. The discussion of financial performance, guidance, and analysis tends to come at the end, as part of the conversation, not the majority of it.
That veers away from the traditional route that some vendors take, which essentially summarizes financial performance and highlights customers they acquired from other vendors. One is backward-looking and does not outline the company’s strategic direction. The other is forward-looking and stresses the focus on providing innovative and transformative solutions to customers and getting them live. Finance should be devoting the balance of its time before filing to preparing remarks and ensuring it can clearly articulate its strategic vision and customer momentum. You can only do that if you are using a financial management system that provides the data that allows you to be forward looking.
From a technology perspective, I’ve heard you talk about a zero-day close. Is that an evolution that finance leaders should be moving towards?
One of the objectives of a zero-day —or touchless—close is being able to close the books quickly and have access to up-to-date information, while being able to continuously book data throughout the period. A zero-day close is the goal our own finance team is working quickly towards, along with our customers, all of whom saw the incredible value during the pandemic and beyond of being able to close the books virtually and access information anytime, anywhere.