How technology is driving the future of business in Central and Eastern Europe

The business world is increasingly embracing process automation, and robotics is no longer something out of science fiction. Is your company ready to transform?

In late September, TMF Romania participated in the Forbes CEE Forum - the largest regional conference tackling key issues in the business, financial and political environment. I was pleased to participate in the panel session, ‘Trends for the next 100 years.’

The world is increasingly embracing process automation, and robotics is no longer purely a science fiction scenario, but a reality that is knocking on our door. Companies all over the world have already started to prepare by reshaping and considering, at a larger scale, their global business services model.

CEE Forum speakers all agreed that the process actually began decades ago, and companies must continue to embrace technological change, reinvent and innovate in order to keep up. Panellists noted that digital transformation affects virtually all aspects of a business from services development and marketing, to organisation management and international operations with multiple subsidiaries.

In Central and Eastern Europe, multinational companies have been automating core business operations such as lead-to-cash or procure-to-pay functions, by using enterprise resource planning (ERP) – the most complex solution to streamline processes and data across multiple business units of the organisation. Some companies are turning to cloud-based financial solutions, to support their accounting, payroll and debt collection functions. Fintech solutions are well-accepted by financial/fiscal authorities, however some limitations and special requirements remain.

Romanian companies feeling the biggest influence from automation are those in IT (Romania is home to the fastest broadband internet in Europe), telecommunications and the finance/banking services sectors. They’ve implemented different ERP modules across HR (recruiting, personnel administration, employee self-service), finance and accounting, CRM, sales and marketing departments. And the effect is a positive one. These companies have reported significant profit growth as they become more time and cost efficient.

Next on the horizon for companies in CEE countries are the necessary preparations for the automation of non-value-added and repetitive activities. RPA (robotic process automation) software implementation within finance, procurement, HR and marketing departments, among others, is expected to see them achieve further efficiency and cost savings. This particular tool has already been introduced to CEE markets by global providers and implemented with the help of local vendors. But while RPA can be incredibly effective for companies and across departments locally, those with a multi-jurisdictional presence will find there is a limit to this software’s effectiveness – particularly with regard to global coordination of country-specific regulation and compliance.

For example one of TMF Romania’s clients, as part of its international operations, was processing its purchase invoices in Asia, payments in India, and they had payment approval in China. VAT compliance was completed in Western Europe and they also needed to report to relevant authorities in CEE. Process automation spanning multiple locations and disciplines with time zone, cultural, language and communication barriers can only go some way before a more human, local approach is required.

Key observations

These were some key observations during CEE Forum panel discussions:

  • business reach has extended virtually across the globe
  • products and services are now conceived, designed and delivered to end users with no limitations
  • companies are focused on improving the customer experience, as they (customers) are expecting seamless and customised experiences at each touch point. New channels to engage with  customers and better collaborate with partners are constantly emerging
  • there is a clear need for global partners and technologies to support seamless development.

To be global means to know how to localise and standardise your processes, regardless of the country you operate in. As highlighted in TMF Group’s 2017 Financial Complexity Index, BEPS and transfer pricing, technology and the risk of non-compliance are key challenges for finance managers not just in CEE but across the globe.

Organisations are carefully selecting their partners in local markets in order to ensure that they encounter no nasty corporate compliance surprises. And increasingly, the ‘last mile’ of financial and fiscal compliance functions is managed by external providers – like TMF Group – that are specialised in global business services processes. We possess the local knowledge that for many companies makes operating in foreign markets, in full compliance, much easier.

Forum panellists concluded that we have seen significant growth in the CEE economy over the course of this year, friendly fiscal policies in many European countries being contributing factors. It continues the trend of the last decade in which CEE has become a reference point on the world’s map for foreign investors, as most countries in the region boast a skilled workforce, low manufacturing costs and they are proactive with state-supported measures to encourage foreign capital inflow.

Business leaders at the forum highlighted that they are interested in a rapid increase in company revenue. Using the right technology to cut back their operational costs and increase their productivity has helped, but choosing a trustworthy partner to deliver non-core functions so they can focus on sales and growth with compliance peace of mind, has been a critical move.

Talk to us

TMF Romania’s experts can help you realise your business opportunities in CEE, whether you are entering the market for the first time, or looking to simplify your operations.

Need more information? Get in touch with us today.

Learn more about our services in Central and Eastern Europe and how we help to drive efficiency in businesses across the globe.

Keeping up to date

You can now receive our insights and regulatory updates direct to your inbox by choosing the topics and jurisdictions that most interest you. 

Subscribe to our e-Alerts.