The Japanese conglomerate Hitachi operates in almost every industry across the world, separated into 11 business segments: Automotive systems; construction machinery; digital media and consumer products; electronic systems and equipment; financial services; information and telecommunication systems; railway and urban systems; high functional materials and components; power systems; social infrastructure; and other components and systems.
With a brand that's a household name across the globe and a company with experiencing such vast financial growth year in year out, finance comes with its challenges: Hitachi must perpetually innovate and rethink its financial strategy to maintain its place as a global leader.
Innovation Enterprise sat down with Guillaume de Pommereau, CFO for Hitachi Europe, to talk about the future of the CFO, what technologies are disrupting finance today and how automation will aid and disrupt finance.
Innovation Enterprise: What new technology has been most influential to your industry and career over the last three years?
Guillaume de Pommereau:Our core ERP is SAP and we have improved its efficiency by adding several "add-ons" such as reporting and planning in the form of BPC; month-end balance sheet reconciliations on a cloud-based web site, Cadency; travel and expenses claims managed by a cloud-based site, Concur; and OCR of supplier invoices, ITeSOFT.
We are focusing on "automation", which is different from artificial intelligence (AI). Once we will have matured all systems to automation, then we will look at AI.
IE: Do you believe next technologies such as AI and machine learning will begin to cause redundancies, or will there always be a need for human talent in finance?
GP: Any process that is repetitive and rule-based is prone to being automated or handled by AI RPA. But finance in an enterprise has to cover many areas that are directly linked to customers, products and strategy.
So, my answer is "it depends". Some areas will suffer redundancies, some will not.
IE: Is finding finance talent becoming more difficult? If so, why?
GP: Finance talents as such are not difficult to find. But, the right finance talent nimble enough to use our existing systems and keep pace with the rhythm of change, this is where the challenge is.
IE: What are some of the challenges you’ve faced as the workplace becomes more digitized?
GP: Digitization is good because it facilitates automation and, later on, RPA. But the issue is to standardize a company as diverse as Hitachi to the same systems and tools.
IE: Do you predict that your teams' role will become more automated over the next five years? How do you believe this will affect your day-to-day role?
GP: The transactional work will be fully automated, but areas of expertise such as tax planning, internal audit, FP&A, business support, M&A and strategy will not.
Automation makes the processes more rigid. Once a process is automated, the tendency is to let it work as is. But the environment is now so fluid and volatile that too much automation could make a company very rigid at the expense of being nimble and reactive.
GP: The key skills needed are:
- To be able to understand the increasing complexity of the regulatory tax and compliance environment while having fewer resources.
- An understanding of the business inside out and an ability to provide the CEO with a finance perspective on all decisions.
- To be supportive of the business growth by providing the necessary funding (debt and equity) to make the necessary capex and M&A.
- An ability to support risk-taking in a measured way.
IE: What will you be discussing during your presentation at the CFO Rising Europe Summit?
GP: I plan to explain how a large conglomerate like Hitachi struggles with standardization of systems and in adopting new technologies like RPA.
I will present Hitachi Europe, its diversity and its financial operation in a perspective of optimization and will talk about adoption of future technologies.