CFO Lessons: How to Solve the Finance Software Blues

Here’s a conundrum for the CFO. You give the green light for the company to invest more than US$774,000 on a software suite that is meant to strengthen controls in financial management and procurement, as well as enhance the quality and delivery times of financial reporting.

Six months after the system went live, monthly closing, which used to be completed in less than ten days, lengthened to 15 days. The finance team continues to work 12-hour days. And the basic software suite cannot easily generate the kind of customized reports demanded by management and the mother company, not to say the stock market.
What do you do?
In the case of US$382-million-a-year-in-sales CITIC Telecom International Holdings Limited in Hong Kong, the answer is to keep the faith. “My team needs to learn how to use the system faster,” says Rosanna Lee, President, Finance. “I hope in two months, three months from now, we will see the benefits.”
Doubling down on the investment, the company has been persuaded to purchase Oracle Business Intelligence Enterprise Edition (BIEE), an additional solution that promises to enhance the basic reporting capability of Oracle E-Business Suite (EBS), which CITIC Telecom bought in 2010 for its financial and procurement processes.
“Every company has unique requirements for reporting,” argues Tevens Kwong, Head of Application Service at systems integrator Karga Solutions, an Oracle Platinum Partner helping CITIC Telecom implement the software. “All the Tier I ERP solutions can provide only standard reporting to the user.” Neither SAP nor Oracle can “fulfill this part [customized reporting],” he says.
And to be fair, says Lee, “security is now better than in the past . . . I think my boss [CFO David Chan] is happy because he can trust that Oracle assures control and security, that these are implemented in the system.” EBS, she says, “will not make mistakes, human error.”
Reality check
Still, CITIC Telecom’s experience highlights the challenges finance departments and companies face in transforming financial management and other business processes.
Discovering that you need additional tools (and having to stump up more money for them) is only one part of it. Processes seen as not suitable for automation, training and other staff challenges, too high expectations, and, at least initially, heavier workloads are also key elements.
Before implementing EBS, CITIC Telecom did not have software for procurement. “All approvals for procurement were paperwork,” Lee recalls. “But financial reporting was automated.” Finance was using financial reporting software developed by a local vendor, a system that Lee says was “pretty good” -- and cheaper than solutions from global companies like Oracle and SAP.
The problem: the local vendor's system was weak in controls. “After our internal auditors [assessed] the system, they advised us we needed to enhance the security of the system,” says Lee. “That was the critical point we needed to reconsider.”
The vendor could have fixed the flaw, says Lee, but the company saw an opportunity to kill several birds with one stone. Kepro, a sister company of Karga Solutions, had been engaged to study the company’s workflow. To fix the security problem and optimize business processes, Kepro recommended that CITIC implement EBS.

Why Oracle? The CITIC group had opted to use Oracle’s ERP system, and so it made sense for CITIC Telecom to build Oracle EBS on top of that stack. The linkage between procurement and financial systems was also a plus. In addition, “we wanted a system that has a large [capacity for] database management,” says Lee.

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