Financial services industry is using S/4HANA for digital transformation

SAP has developed an enterprise resource planning software, S/4HANA, which companies like Deloitte highly use from the Big 4 and other companies in the finance industry.

How is the software affecting the finance industry?

SAP S/4HANA allows the finance department to move faster and get deeper insights into almost every aspect of financial management.

In addition, it serves as a hub for integrated analytics in real-time, eliminating the need for manual processes like sorting and processing.  

Here are five ways S/4 HANA is helping the finance industry:

1. Forecasting and planning

Finance companies today invest a significant amount in financial planning for their clients to develop strategies such as top-down targets or bottom-up budgets. These processes are very complex. With the help of S/4HANA, these problems can be easily eliminated. S/4HANA is built on the concept of Core Data Service (CDS), in which data is stored on the database server rather than on the application server. This enables the automatic updating of data from SAP S/4HANA. This, in turn, allows the organization to better understand and respond to changes in business performance and market conditions.

2. Single source truth for data

Although database server was enforced into the concept of ERP, several limitations forced the ERP companies to store the client's data in different tables. Accessing and understanding these tables was very time-consuming and complicated.

With S/4HANA, all finance-related data is finally stored in a single table with multi-dimensions and logic, enabling simple distinctions between tax, statuary, legal, etc.

3. Real-time profitability insights

The best way to comprehend a business's financial performance is to examine its margins and the factors for profitability. That's why SAP's S/4HANA Margin Analysis features are so helpful; they're a massive upgrade over older methods of calculating profit margins.

By drilling down on any desired attribute, Margin Analysis makes it much simpler to acquire true insight into the company's margins, sales, and expenses and to find and fix cost irregularities. Concurrently, all financial data, including sales and expenses, are kept up-to-date and accurate and are reconciled with the income statement for complete openness and convenience.

4. Group Reporting with S/4HANA

SAP S/4HANA Group Reporting is an advanced consolidation option that doubles as a group financial data platform and provides seamless connection with core business processes, including accounting, planning, and reporting. Legal consolidations and financial reporting are conducted inside the heart of SAP S/4HANA Group Reporting, using data from the general ledger, resulting in quicker, more transparent, and efficient consolidations and financial reporting.

The alleged Universal Journal is responsible for all of this. For example, SAP S/4HANA employs its Universal Journal to record all financial transaction information in one database. At the same time, conventional ERP systems were often optimised for transaction processing with data saved in many distinct tables.

5. Better User Interface

The SAP graphical user interface has long been criticised for its poor aesthetic. This has resulted in enterprises having to spend more money on training new staff and facing difficulties in getting their customers to embrace solutions that operate on SAP. In addition, the limited usability and lack of compatibility with all devices meant that it did not facilitate mobile or remote employment. 

SAP's displays in SAP S/4HANA have been streamlined, user-centric, and more uncomplicated to use thanks to the release of SAP's HTML5 user interface, Fiori, and SAP's digital platform as a service, SAP Cloud Platform. 

More than just a pretty face, the device-agnostic Fiori user interface gives finance professionals complete reign over the transformation process by giving them more say over workflows, report definition, and app selection. Therefore, several enhancements and innovations may be implemented inside finance without requiring laborious development procedures with the IT department.

The SAP S/4 HANA platform is the ideal instrument for transformation, which results in improved performance in the financial sector. It is time for financial institutions to go ahead with automated solutions, given the wave of digital disruption that is now sweeping across several sectors.

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