Finance executives turning to technology to boost workflow efficiency
September 2017 | PROFESSIONAL INSIGHT | BANKING & FINANCE
Financier Worldwide Magazine
September 2017 Issue
Technology is a catalyst for change, driving innovation within the finance and accounting space to boost operational efficiency in business-critical functions. Business leaders are rethinking how to ride this wave of opportunity in order to streamline their processes for efficiency, compliance and risk management.
The responsibility for controlling the company’s finances lies with financial executives, who are turning to cutting-edge solutions to enhance the transparency and accuracy of their financial data and to better coordinate the financial management process.
In order to build stronger customer centricity across the business, finance executives need to nurture relationships with partners who support them in delivering the service. Many businesses work with multiple partners, suppliers and vendors who help them in their quest to deliver optimal services to their end-customer.
However, according to the Asset Based Finance Association (ABFA), the average time a UK business has to wait for payment currently sits at 61 days. There is a culture of late payments across both SMEs and large companies which has proven costly. Earlier this year, the UK government published a new regulation to push larger companies to be more transparent about their payment processers to help tackle the issues concerning payment of partners.
As a direct result of late payments, in 2015, Hilton-Baird reported that 79 percent of businesses were forced to invest more time in chasing invoices and 48 percent had to pay their suppliers late. A balance needs to be struck between businesses being able to comply with reporting obligations and the level of functionality of these reporting systems. Operational resilience is key to ensuring service is maintained to avoid any disruption when it comes to processing invoices, payroll or tax filing.
Automating manual processes increases the speed of the finance function – in one business case; it has processed 94 percent of the invoices within two or three days. Automation creates a strong operational foundation which ensures the successful maintenance of relationships with supporting partners to avoid dissatisfaction.
Many businesses are hindered by siloed financial systems which work for different business-critical functions, making it extremely challenging to understand their financial data. It is about having a system which transcends different business areas to gain a more holistic view of performance. Using a fully integrated and modular architecture to consolidate the information in one place to track, monitor and audit removes the challenge of obtaining a transparent overview of cash flow. It is about collating information from multiple applications or screens and presenting this information on a single screen for actionable insights.
New technologies assist with the financial management process, by allowing teams to have more financial transparency across different business processers, such as tax filing and invoicing administration.
Working from a robust, web-based workflow solution to manage end-to-end procurement and pay cycle can accelerate service delivery. Cloud services where applications are run online are an increasingly attractive investment option for finance executives. Working from desk-based software is no longer adequate in an increasingly digital age. Cloud systems allow them to receive regular up-to-date information related to compliance across various processors such as payroll and taxation.
Finance executives are increasingly using data analytics when it comes to bookkeeping. Being able to convert data into compelling insights to inform decisions around reporting, forecasting and budgeting is key to ensuring the financial success of any business. These new technologies are putting a lot of emphasis on forward planning, where data is being utilised as a way to predict trends, manage mistakes and smooth out workflow processes to bridge the cash flow gap.
The role of human intervention in these processes is shifting. Real-time reporting reduces expenses and time delays and enhances satisfaction among partners, as the technology framework used for reporting can automatically track documents and mitigate human intervention. It is about ensuring there are no slips on areas which are left ungoverned, opening the business to an inaccurate image of their cash flow and expenditure. Automating repetitive tasks can help businesses reap financial benefits and in one case helped a UK company recover £1.7m which was a result of missing and incorrect documents. This takes away the headache of trawling through the high volume of paperwork, spreadsheets and data to help staff manage their workload better.
Not only does automation promote a more efficient working model, it helps retain staff who are able to deliver high-value work that is more fulfilling and less labour intensive. Staff are given the opportunity to steer the direction of a business’s performance, making them more invested in its future.
There are progressive steps being taken by many decision makers to create a resilient but agile financial ecosystem which can spearhead financial transparency and be weaved into different business areas – sales, marketing, HR – to drive business growth. The right combination of IT, internal controls and skills will enable businesses to better manage their cash flow challenges more effectively and make a positive impact on their business operations.
Bhupender Singh is chief executive of Intelenet Global Services.
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