Enterprise social media will make it more useful to the finance function

accapr —  3 February 2014 — Leave a comment

social technologies

By Warner Johnston, head of ACCA USA

People have been using computer-based networks for decades to create, share and exchange information and ideas. The rise of social media was driven by people, not organisations. Historically, IT innovation was driven by big business and the military, but blogging, instant messaging, and sites for sharing pictures and music have become established as popular personal communication and collaboration tools. These have then attracted the attention of businesses, government bodies, charities and other organisations that also wanted to exploit them to improve communication and collaboration with and between their many internal and external stakeholders.

As more organisations explore the possibilities offered by public social media and ‘enterprise’ social tools they are finding that they can help to:

  • improve communication and collaboration (inside and outside the enterprise)
  • enhance decision-making and productivity
  • open up new routes to investment
  • support the development of new products and services
  • improve understanding of customers and clients
  • personalise customer experiences
  • analyse and respond faster to feedback
  • tap into and exploit intelligence outside the enterprise
  • source, attract and engage talent, and
  • develop a brand and build brand loyalty.

When businesses began exploiting social technologies they tended to focus on many of the same types of social media as had gained popularity with personal users. At one end of the spectrum businesses are using LinkedIn for recruitment and Facebook for brand management. At the other end, sites such as Crowdfunder and Kickstarter are being used to raise investment for start-ups and established businesses. The Securities and Exchange Commission in the USA has announced that social media outlets such as Facebook and Twitter can be used to make disclosures to investors (SEC 2013).

The appeal of a Facebook-style interface tends to be generational, but research shows that social technology ranks second behind analytics as a technology innovation priority. Adoption is expected to increase as accountants in practice and the finance function understand what social collaboration can do to improve their performance.

Research by ACCA on the technology trends that will impact the profession shows that a significant portion (59%) of respondents expect widespread adoption by the profession within the next two years, and 29% within the next two to five years. Over 9% expect to feel the impact on the finance function between five and ten years from now, and just 2% expect no impact on accountants and the finance function.

As enterprise social functionality improves, social tools will become more useful to the finance function. In an ideal world, collaboration software will develop situational awareness that enables it to contextualise processes and the roles and relationships of participants. In the context of finance, for example, software needs automatic understanding of the difference between general exchanges and any that must be tightly controlled – such as exchanges between tax and finance departments.

Read more about the technology trends that are impacting on the accounting profession at http://roleofcfo.com.

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