Through the ups and downs of the last year, the road to business recovery feels like a rather long, bumpy one.
We see from previous crises and recessions that at times like these, building business resilience is crtitical and the finance team needs to take the lead on driving recovery strategies and plans. To do this, you need to focus not only on streamlining your business processes, but also your finance processes, so you can gain control and visibility of spend. This gives you the agility to react quickly to immediate challenges and opportunities. It also frees up time so you can drive the longer-term sustainable plans for the business.
For many businesses, there are three key areas that will be top of mind right now:
- Supporting your remote workers
- Controlling costs and improving cash flow
- Improving compliance and protecting against fraud
Let’s look at each of them in turn.
Supporting Your Remote Workers
Your staff members are your most valuable assets and how you treat them during the crisis will prove vital to your long-term success. A meta-analysis by Gallup found that companies with highly engaged workforces are 21% more profitable than those with poor engagement. This is especially significant if your employees are working from home at the moment – and may continue to do in the longer-term too.
Richard Izard, Managing Director of Global Leadership Associates, says: “When humans are under pressure, it’s more important than ever that our basic needs are met. Connection and being heard are two of the most meaningful, but they’re often in danger of being overlooked in our current virtual ecosystems. If you want happy and productive employees, they need a sense of purpose and satisfaction that comes from having those needs met in their professional environment.”
For the finance team, this means the digital transformation of processes is no longer a luxury. As remote working becomes the norm, employees will expect streamlined, paperless processes wherever they are because it will make their lives easier. It’s also true that digital finance processes will help the finance team too – no more battling with paperwork, manual entry, human error and a lack of visibility into your cash flow.
Controlling Costs and Improving Cash Flow
Research has shown that 81% of failed small businesses said they collapsed because of cash flow problems. It’s why cash flow is always important – and perhaps never more so than in times of crisis.
If you want to keep a closer eye than ever on controlling costs and improving cash flow, here are a few places to look:
- Cutting costs. Consider trying to negotiate better deals on your rent, your utilities and your insurance. You could also ask regular or frequent suppliers for discounts.
- Leasing equipment instead of buying it. This means you don’t have to find the capital to buy it. There can be tax advantages too.
- Invoicing promptly. The more quickly you invoice the more quickly you’ll get paid.
- Offering discounts for prompt payment. You’ll need to do the sums, but this can be a great way to encourage slow payers.
- Asking for deposits or invoice in stages. This is especially useful for large contracts or contracts that may go on for some time because it helps smooth out peaks and troughs.
- Getting control over your travel and expenses. A typical company spends over 10% of its annual budget on T&E. Tools such as Concur Travel and Concur Expense help you get travel and expense spend into your system much more quickly and give you insight into where you could cut down or negotiate discounts.
- Not paying your suppliers too quickly. It will harm your relationship to pay late, but make your capital work for you by finding the optimum time to pay.
Improving Compliance and Protecting Against Fraud
Instances of cyber attacks are increasing as people work from home – Action Fraud reported that it received 3,916 reports of cybercrime during the first month of lockdown alone. In addition, the reality of working from home means that the nature and categories of company spending are likely to have changed.
Are you able to easily detect duplicate and fraudulent invoices before they are paid? Do your employees have clarity on what expense claims are allowed? Are 'out-of-policy' and inaccurate claims automatically flagged to your finance team?
Over a third of UK SMBs specifically pointed to fraud and risk management as major challenges of managing company spend manually and 53% of UK SMBs say that better compliance and fraud detection was a top benefit after automating travel and expense.
Tapping into Expertise to Support Your Business
As you seek to support your business and navigate your way through the coming weeks and months, tapping into expert support will be crucial. To help you, check out our business continuity hub, which links you to free templates, advice guides, top tips and webinars with industry experts – all on the theme of building business continuity and increasing resilience.