Finance Transformation - Glossary

21st century enterprise. A term used by industry leaders for the future enterprise operating model, in which all companies become technology-enabled organizations requiring a significant change in how they operate. 

artificial intelligence (AI). The ability of technology and applications to perform tasks that would normally require human intelligence. 

automation. Using technology, rather than people, to perform tasks and manage processes. 

Baby Boomers. The generation of people born mid-1940s to mid-1960s. 

big data. The huge amount of data being created, collected, stored, and analyzed. 

blockchain. A digital, distributed transaction ledger with identical copies held on the computers of the members of the network. 

build. A term used by KPMG in its future of finance perspective that refers to the finance value chain objective related to the design, development, and maintenance of all finance applications. 

business ecosystem. The environment in which the business operates — including its interdependency on customers, suppliers, employees, other stakeholders, and society as a whole. 

business model refinement. An approach to dealing with disruption that involves smaller, incremental changes to organization form, management practices, and technologies used. 

business model renewal. An approach to dealing with disruption that involves fundamental change to the organizational form, as well as adopting new management practices and new technologies to create value. 

CGMA Competency Framework. A model that identifies the competencies required by finance professionals today and in the immediate future. CGMA stands for Chartered Global Management Accountant. 

cloud computing. A service delivery model that offers on-demand computing services such as software, applications, analytics, storage, servers, or database services over the internet — that is, infrastructure as a service (IaaS), platform as a service (PaaS), and software as a service (SaaS). This service model typically allows for lower operating costs, as users pay only for the services used; this model also allows an enterprise to scale quickly as needs change.

Cloud ERP. Enterprise resource planning (ERP) software hosted in the cloud versus on premise.

cognitive computing. Computing that uses a variety of AI technologies — including data mining, natural language processing, machine learning, and computer-human interaction — to simulate the human cognition process to find solutions in complex situations for which the answers may be ambiguous or uncertain. 

cost model. A model using mathematical equations to determine product cost. 

CRM. Customer relationship management. 

customer segment. A grouping of people based on geography, demographics, lifestyle, behavior, or purchase journeys. 

DevOps. An integrated approach to software delivery that enables rapid, small, iterative development and deployment of solutions, with feedback quickly incorporated into the next release, delivering value incrementally. 

direct competitors. Businesses from the same industry or sector that offer the same product or service and operate in a similar way. 

direct-to-consumer (DTC) models. A model involving a producer of branded goods selling direct to consumers online, cutting out the middleman. 

disruption. A major change to how an industry, market, or function within a company operates. 

disruptive factor. Something that causes, enables, or drives disruption in the business environment. 

dynamic pricing. The use of technology to change prices and maximize revenue based on supply, demand, and the willingness of customers to pay. 

engage. A term used by KPMG in its future of finance perspective that refers to the finance value chain objective related to finance business partnering. 

enterprise resource planning (ERP). The class of applications used by the finance organization to support enterprise resource processes, including the general ledger, accounts payable, accounts receivable, fixed assets, and projects. 

enterprise performance management (EPM). The class of applications used by the finance organization to support the budgeting, planning, forecasting, and enterprise
performance management and analytics processes. 

everything as a service (XaaS). A term used by KPMG’s future of finance perspective in which all functions within the 21st century enterprise could be delivered as a service by a third party rather than being owned within an organization. 

financial planning and analysis (FP&A). Activities that support major corporate decisions. 

fourth industrial revolution. Also known as industry 4.0. The wave of technological change (PC, online, mobile, social) that has empowered consumers and facilitated new business models. 

friction. Anything that interrupts the customer journey at any point from initial contact to after-sales service. It may cause the customer to seek alternatives. 

Generation X. The generation of people born mid-1960s to mid-1980s. 

Generation Z. Also known as iGeneration. The generation of people born mid-1990s onwards. 

globalization. The increasing interconnection of people around the world — economically, politically, and culturally. 

growth mind-set. A desire to learn, an acceptance that intelligence and knowledge can be developed, an openness to giving and receiving feedback, and a can-do attitude that helps confront and surmount obstacles. 

indirect competitors. Businesses that address the same customer need but in a different way. 

Internet of things (IoT). The ability of items that are not primarily a computer to connect to the internet and other devices. 

machine learning. Technology that enables systems to adapt and learn from experience, and to uncover hidden patterns and relationships. 

master finance architect. A reference used in KPMG’s future of finance perspective defining the role needed to ensure the optimized design and delivery of the integrated architecture. The master architect has final authority over the integrated design and helps ensure that finance maintains an optimized and agile application environment that delivers the expected capabilities and solutions for the engage, plan, and run groups. 

millennials. The generation of people born 1980 to mid-1990s. 

minimal viable product (MVP). An approach involving the rapid development and release of a product or service, which is then continually improved based on feedback. 

natural language processes (NLP). Technologies that process large quantities of textual data to efficiently provide enhanced insights and analysis. 

nontraditional competitors. Businesses from different industries that offer a different product or service that meets the same need. 

personalization model. An approach to segmentation and delivery channels. Experts select products based on a consumer’s previous shopping preferences and purchases, which are delivered to the consumer on a sale or return basis. 

plan. A term used by KPMG in its future of finance perspective that refers to the finance value chain objective related to enterprise finance activities that are strategic and forward-looking in nature. 

replenishment model. An approach to segmentation and delivery channels. Smart sensors detect when a product is running low and reorder it for delivery. 

revenue model. A model of how an organization will generate revenue. 

robotic process automation (RPA). The use of software to perform specific tasks within processes, thus reducing manual activities. 

run. A term used by KPMG in its future of finance perspective that refers to the finance value chain objective related to finance operations focused on the controlled and effective execution of financial processes. 

SaaS, or software as a service. Software that is accessed and hosted online via subscription, where the vendor of the software is responsible for the maintenance and updates to the software as part of the services provided. 

sales channel. A way to provide goods and services for customers to purchase. 

sharing model. An approach to segmentation and delivery channels. Consumers pay to use a product when it is needed, but do not purchase it. 

sharing surplus. The residual value created by an organization available for its stakeholders, including taxes, dividends, incentive compensation, and earnings retained for investment. 

subscription model. A delivery model that involves a commitment to recurring payments rather than independent purchases. 

supply chain analysis. The mapping of the supply chain and the identifying critical dependencies, key vulnerabilities, and most at-risk suppliers.

user-developed application (UDA). Any application developed by a person to supplement a technology gap or create a recurring use report or database that isn’t managed by the enterprise (for example, Excel reports). 

virtual reality. A three-dimensional, computer-generated environment that can be explored and interacted with by a person.

XBRL (eXtensible Business Reporting Language). Software framework used to communicate business information and meet SEC reporting requirements.

Adapted from ©2019, Association of International Certified Professional Accountants.