Photo/FAW-Volkswagen

Chinese automotive market is going through a challenging time. The market growth slowed down and started to experience negative growth starting from 2017. The COVID pandemic at the beginning of 2020 further exerted huge impact and uncertainty to the market. Many more short-term fluctuations in the future are expected, and competition is expecting to be severe than ever not only for brands and products but also for space occupied in value chain and business model innovation.

Dr. Andre Stoffels, First Vice President (Finance) of FAW-Volkswagen Automotive Co. Ltd, firmly believes that a big transformation journey is a must for FAW-Volkswagen to cope with the challenges and seize the opportunities. A digital transformation journey is in line with FAW-VW strategy of staying ahead of future mobility.

“Project 4F - Future Finance for FAW-VW”, the finance digital transformation project, is one of the first important steps, to lead this company-wise transformation journey. This project aims to embed digital DNA to FAW-VW finance. “In the modern working world, we envision our finance to be faster and smarter, providing ‘real-time’ insights and driving the success of the business”, said by Mr. Stauch and underlined by Mr. Xiong, the project managers of Project 4F.

“What is digital finance?”

Digital is not simply about utilizing systems or digital tools, transferring manual work from paper to computers or robotics. The core of digital finance lies in changing the way of working.

Changing the way of working starts with the mindset change. In order to transform from data cruncher and budget controller to business enabler, finance shall be more business driven and customer centric. Our finance colleagues shall keep breast with business developments and have very close collaboration with business departments. The ultimate goal is to have relevant departments to collaborate to drive end-to-end process optimisation and share one database where data throughout the end-to-end processes are captured and communicated to key stakeholders. Only in this way, the organisation as a whole can adapt and respond to the market’s dynamic changes in a faster and smarter way.

The second element in changing the way of working is skillset change. Expertise in finance and accounting, treasury, tax and internal audit is still important, but meanwhile, our finance colleagues need to develop strategic thinking, business acumen and skills in data analytics and utilizing digital tools. With the new skillset, finance can act as business enabler and decision maker, actively engaging with all involved parties and driving the success of the business.

The last element lies in the culture of continuous improvement. Continuous improvement is important because it is the best way to ensure that FAW-VW finance are doing things the most efficient, effective and productive way. Our finance can employ “Voice-of-the-customer” analysis to continuously boost operational excellence and deliver business impact.

Photo/FAW-Volkswagen

“How will be the digital finance transformation?”

We will go through this journey by a two-step approach:

Step 1: Where are we going?

We formulated our digital finance transformation vision by focusing on one question: “What can finance do for business?” We envision to realize real-time finance through one team with digital mindset and competencies to enable business success.

Step 2: How do we get there?

In the 1st stage of 4F project, we had performed a quick and comprehensive pulse check with quantitative and qualitative analysis to set a starting point for future optimization.

We are implementing a comprehensive Target Operating Model (TOM) to design and drive changes in all areas by leveraging the best practice of world’s first-class finance. For each TOM dimension, we will derive detailed measures, which will be prioritized to formulate the implementation roadmap towards our real-time finance vision in 2022. Measures which can be implemented by the end of this year have been identified as quick wins and put into actions.

Photo/FAW-Volkswagen

In the context of digitalization, “Not to advance is to go back”, we will fully leverage state-of-art technologies (e.g. modern ERP, Robotic Process Automation, digital BI and predictive analytics, etc.) to free up Finance from transactions processing to have more capacity for in-depth analysis and business insights. In this way, finance can transform from data cruncher to real business enabler.

“Hello, finance of the future!”

The world is changing, so are we! We are on the way to become more digital, real-time, data-driven and customer-oriented! Come and join us, together we are pressing on toward the future finance for FAW-VW!

Photo/FAW-Volkswagen