Adam Zoucha, MD EMEA, FloQast
The looming recession is pressing businesses to rethink their growth strategies in order to weather the storm. The combination of Brexit, the ongoing war in Ukraine, and sustained inflation is upsetting the foundation of the UK economy.
Already feeling the pinch, organisations will be considering ways in which they can cut costs, but choosing where to cut back is a challenging task. Overcutting could detriment a business’ ability to grow, yet being hesitant to cut costs could endanger business survival.
For some organisations, regulating expenditure may result in pausing, postponing, or even cancelling modernisation programmes. However, this is not necessarily a savvy decision. Accounting and finance teams, for example, will require fast, accurate decision-making to inform key business strategies and tactics to weather the volatile financial landscape. These teams often suffer from siloed, manual workflows and poor visibility across aggravating monthly Close processes. Combined with the impact of the impending recession, they may struggle to offer the agility and speed necessary to support leaders when making time-sensitive decisions.
Strategically making investments that will improve workflow, such as accounting automation, will see companies reap the rewards as they enter an economic slowdown. So, why then might business leaders and finance teams appear reluctant to adopt new practices?
The “if it’s not broken, don’t fix it” mindset
Typically, hiring more employees was seen as the solution to managing increased and complex workloads. However, against the current economic backdrop, many organisations are unlikely to look at this route. And simply throwing more people at the problem is not the way to increase productivity and make a team more effective. Trends show that fewer people are entering the accounting profession and growing numbers are retiring or leaving. Combined with tightening budgets, hiring could be paused and the size of teams reduced. Losing the mindset of “if it’s not broken, don’t fix it” and turning to technology can make all the difference to bridging the resource gap.
Accountants have long bemoaned the repetitive and manual processes that can eat into the workload each month. Time consuming manual processes not only create greater room for error but can slow down decision making, with insights taking longer to deliver to leaders. Implementing technology to accelerate accountancy processes and alleviate the stresses placed upon accountants will increase capacity and the ability to react more quickly. So, contrary to suspending investment into process, it could be argued that a period of stunted economic growth poses an ever-greater need for businesses to invest.
Full steam ahead – the benefits of adopting technological tools
There will be reluctance from many leaders to adopt new solutions when budgets are being scrutinised. However, when chosen well, the right tool can be quick and easy to deploy and will lead to significant time savings in the long run.
What’s more, improving traditional accounting processes will drive other efficiencies with departments outside of finance such as sales, IT, and marketing. Connecting teams from different departments allows for increased productivity, transparency and collaboration upstream and downstream from the Close, and across the Close process itself. This increased communication ensures that roadblocks leading up to the time-critical month-end can be identified and dealt with swiftly.
Team spirit and morale will also benefit from the adoption of new tools – something not to be overlooked in today’s competitive employee market. Accountants will be relieved of mundane tasks, such as chasing endless scraps of missing data. Automation removes this – and other – grunt work from teams’ shoulders – reducing stress and errors associated with tedious and repetitive tasks.
Simplifying organisation and coordinating the Close, while streamlining reconciliations will help housekeeping tasks be completed sooner. As a result, teams can focus more on the strategic aspects of their work, shifting away from the tireless data-crunching toward a more fruitful role. Having the right tools can help workforces become happier and increase team morale – and with talent shortages and the threat of recession, it is paramount to keep the people on your team happy and productive.
In a challenging economy, leaders need a faster time-to-insight, and access to accurate financial data becomes more critical than ever. So, you could say that when times are tough, halting modernisation could jeopardise the key decisions your business needs to survive, succeed and even thrive.
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