Record-to-Report (R2R) is one of the most strategic processes in shared services, transforming financial data into actionable insight. R2R plays a critical role in ensuring compliance, enabling financial agility, and supporting strategic decision-making.
Yet, despite years of digital investment, most R2R functions remain surprisingly manual. The recent report from SSON Research & Analytics and Redwood Software, The R2R Efficiency Mirage, reveals that the gap between perceived automation levels and the operational reality is greater than many R2R teams realize.
This disconnect between presumptions of progress and the true state of operations highlights the untapped opportunity to achieve a truly touchless close.
Barbara Hodge, Global Online Editor at SSON Research & Analytics, and Aaron Veach, Executive Director – Finance Transformation at Redwood Software, presented this research at the 2026 Shared Services & Outsourcing Week in Orlando, posing the question:
Is your close actually automated?
For R2R practitioners unable to attend the session, here are the key takeaways:
R2R Digitization is Not the Same as Automation
Most R2R teams equate system adoption with automation: if workflows are digitized and visible via dashboards, they are often considered automated. However, visibility does not always mean execution.
This has resulted in a false sense of automation maturity, as R2R platforms act as monitoring layers. Systems show what needs to happen, but humans step in to make it happen. This includes:
- Extracting data
- Validating inputs
- Applying business logic
- Resolving exceptions
The process may be digitized, but it is not autonomous. The real efficiency opportunity remains unrealized.
The R2R Progress Paradox
71% of R2R practitioners say they have made significant automation progress. 63% say over half of their financial close is manual today. This paradox is driven by:
- A lack of a consistent definition of automation
- Confusion between digitization and true automation
- Measuring success based on tool adoption, not outcomes
Unless teams define automation in terms of reduced manual intervention and faster close cycles, the R2R efficiency mirage will persist.
Where Manual R2R Work is Concentrated
Most manual effort in R2R is concentrated in core processes such as journal entries, reconciliations, and accruals. More importantly, 70-80% of efforts occur in journal creation, before anything is posted in the system.
This upstream effort represents the majority of the workload, yet it is frequently overlooked in automation strategies. Many R2R teams focus automation on the final stages of the process, such as posting, workflow tracking, and reporting. While these areas are easier to standardize, they represent only a small portion of the total effort. The more complex activities that occur earlier in the process remain manual.
For example, spreadsheets continue to play a central role, particularly in reconciliations. Excel acts as an unofficial integration layer, flexible enough to fill gaps between systems, but reinforcing manual dependencies in the process.
When People Become the Integration Layer
Without true end-to-end orchestration, people become the glue that connects disconnected systems – manually sequencing tasks that should flow automatically. This creates a fragile operating model that depends heavily on individual knowledge and effort.
93% of teams coordinate tasks without orchestration. Only 7% have systems that auto-execute directly in the ERP.
But the impact goes beyond efficiency: it affects employee experience. Manual R2R workflows often lead to:
- Long hours
- Burnout
- Reduced morale
Highly skilled finance professionals spend much of their time on transactional work, instead of value-adding activities. With accounting talent aging out of the workforce faster than it can be replaced, while workloads continue to increase, the cost of manual R2R is rising.
The Need for True R2R Orchestration
Most R2R teams have coordination systems that notify, track, and report task status. But what they lack is true orchestration, because digitized R2R still relies on people to manage and execute tasks. Orchestration enables systems to trigger, sequence, and complete tasks automatically based on defined rules.
In an orchestrated R2R environment:
- Processes are event-driven and self-triggering
- Tasks are automatically sequenced
- Dependencies are managed within the system
- Exceptions are handled systematically
This moves automation from isolated pockets to a fully connected, end-to-end process.
Orchestration also creates a clean, auditable trail from source data to final posting. This is a critical advantage when navigating multi-tool environments that can otherwise leave a tangled web of evidence across systems.
Overcoming the R2R Efficiency Mirage
The R2R efficiency mirage will continue unless practitioners undergo a shift in strategy and mindset. Finance leaders should:
- Redefine automation by reduction in manual touchpoints, not software adoption
- Focus automation investment upstream in tasks like journal creation
- Embed business logic directly into automated workflows
- Enable end-to-end orchestration to eliminate manual handoffs
A truly touchless financial close is achievable, but digitization is only the first step. Treating it as the finish line has left R2R functions operating in the efficiency mirage: appearing automated while remaining fundamentally manual.