What Are Your Barriers to Business Growth?
In my last blog I looked at how change and uncertainty is a constant theme in business. With the big change in the form of Brexit on the horizon, we asked market research specialist Vanson Bourne to survey 500 UK finance leaders to explore growth strategies in a changing economic landscape. The full results can be found in Fuelling Business Growth: How UK Finance Leaders Can Drive Strategy and Avoid Risk.
Preparing for Business Growth in the Age of Uncertainty
The acceptance of uncertainty and an unwillingness to let it stand in the way of growth was evident in the survey results. 96% of the businesses surveyed say they are planning to grow and uncertainty is not seen as one of the barriers to that growth.
In fact, for the business as a whole, the top five barriers according to finance leaders are:
- IT/finance infrastructure (43%)
- Staff productivity (41%)
- Growing customer base (40%)
- Profits for investment (39%)
- Cash flow (38%)
For the finance team specifically, the top five barriers according to finance leaders are:
- Lack of funding for finance (IT, staff training etc) (39%)
- Staff turnover and low team morale (35%)
- Other competing business priorities (35%)
- Increasing compliance requirements (34%)
- Lack of scalability of finance systems as you grow (32%)
What we see is that the big theme in these answers is not uncertainty but a technology gap. Let’s delve a bit deeper.
The Technology Gap
Our research found that a lack of efficiency in finance systems is resulting in problems for 92% of finance leaders.
When we look at the problems faced by finance teams, we start to see why IT and finance infrastructure is holding businesses back. Problems cited include:
- Payment delays to suppliers / employees (30%)
- Inability to forecast and plan for the future (28%)
- Employee / team dissatisfaction (27%)
- Inability to manage cash flow effectively (26%)
- Inability to budget effectively (25%)
The reasons behind the difficulties finance leaders face in planning and forecasting, managing cash flow and budgeting effectively are revealed when we look at how spend is managed.
For many businesses, manual processes still underpin travel, expense and invoice systems. In fact:
- 53% of travel booking processes aren’t automated
- For expense processes it’s 45%
- For invoice processes it’s 38%
On average, enterprise businesses host 52% of their business systems in the cloud and for SMBs it’s 42%.
Given these figures then, it’s hardly surprising that 67% of finance leaders aren’t confident their expense, travel and invoice systems will scale with them as they grow. In fact, there’s already an awareness that scalability is a problem:
- Only 30% say their travel process is completely efficient
- For expense systems it’s 36%
- For invoice systems it’s 43%
The Benefits of Closing the Technology Gap
It is clear that finance leaders understand the problem and see the benefit of automation in solving it. The vast majority (98%) of the finance leaders we surveyed say automation would benefit their organisation. The principle advantages are seen as:
- Helping to reduce manual errors (53%)
- Getting real-time insight into data (50%)
- Controlling costs (48%)
- Helping with faster payments (46%)
What’s more, 93% of respondents agree that connecting expense, travel and invoice processes is important to achieving their growth objectives.
Don’t Let the Technology Gap Hold Your Business Back
These findings show that finance leaders understand how important it is to close the technology gap. In fact, failure to do so could be the difference between growth and stagnation. In the next blog, we will look at how automation transforms finance processes, improves team morale and frees finance leaders to lead business growth. In the meantime, you can access the full research report, Fuelling Business Growth: How UK Finance Leaders Can Drive Strategy and Avoid Risk