How your financial team can become a revenue driver
By: Mark Gilham, Director & Evangelist at Enable
The word “accounting” usually calls to mind a long list of reluctant necessities: annual financial statements, tax returns, compliance reports, audits, and so on. Generating and analyzing this information is vital to monitor the financial health of a company, raise capital, and keep investors informed. But supply chain leaders often view this process as a costly chore – essential as it is. This is why many accountants find themselves in career-limiting non-commercial roles where they often undertake repetitive tasks and in some cases are even derided as “the profit police.” This term is deeply offensive to these highly skilled and experienced professionals, who have the ability to add so much more value to the company.
It’s time to do away with this outdated caricature of accountants and the work they do. The most effective accountants don’t just report on what has happened in the past – they use the data they’ve gathered to generate insights and influence the future. In the supply chain sector, CFOs and their teams aren’t just responsible for preparing financial documents and keeping track of where the company is allocating its resources. They have to be capable of rigorous budgeting and forecasting, which will identify lucrative business opportunities and drive strategy. If anything, accountants are profit enablers.
Accountants improve operational efficiency and maintain critical records, but they can also grow revenue, bring different skills and perspectives to the table, and improve performance in a wide range of areas. As many traditional finance functions are increasingly automated, the most successful CFOs and finance teams will be the ones who recognize that they can add value by helping the company meet its objectives and serving as strategic partners in the growth of the business. And the most successful companies will deploy these teams more broadly.
Despite their reputation, accountants are often the heroes of their organizations – and it’s time to put them into action.
Accounting doesn’t have to be repetitive
Despite the fact that accountants are expensive to recruit and retain, many companies fail to fully leverage their skills. Instead of using automated solutions for menial and transactional accounting work, these tasks are often assigned to financial teams whose talents could be used much more effectively elsewhere. In many cases, accountants are even stuck using rudimentary tools like spreadsheets – a problem that’s particularly common in the slow-to-digitize supply chain sector. An Enable survey found that over a third of companies still use spreadsheets for important financial functions such as rebate negotiation and documentation.
This misuse of your financial team’s time and skills won’t just lead to burnout and turnover – upcoming accountants quickly tire of boring work – it will also prevent your company from finding new market opportunities, improving relationships with business partners through mutually beneficial incentives (such as rebates), and optimizing performance outcomes. An influence-focused financial team provides in-depth analytics on everything from rebate performance to operational efficiency, which is why these teams can offer sophisticated strategic support – such as scenario planning and problem solving.
The days of accountants being perceived as “bean counters” are rapidly coming to an end – they ensure that companies avoid potentially crippling financial mistakes, offer pivotal business insights, and have extensive skill sets that aren’t being embraced. Companies have to stop squandering their most valuable resources. Given the critical role of financial tools like rebates in the supply chain sector, it has never been more important for companies to take full advantage of their finance teams – which will require them to drop the antiquated notion that accountants do not add value.
The expanding role of finance teams
Over the past several years, the role of finance teams has undergone a sweeping transformation. They use financial data to help companies improve their decision-making processes, establish long-term strategic goals, and develop metrics that will track progress toward those goals. In a 2022 survey, PwC found that CFOs are more focused on several core business functions than other executives, such as hiring and retaining talent, reevaluating pricing strategies, and improving supply chain resilience. The proportion of the UK’s leading companies run by finance professionals has more than doubled since the 1990s – a sign that these professionals have highly versatile skills.
According to a 2021 IBM survey, CEOs believe the most crucial executive role is the CFO. This is all the more reason CEOs and CFOs should work together to develop business strategies. For this partnership to work, CFOs and their teams need to cultivate an intimate understanding of how the business functions at every level. When finance teams have supply chain visibility, for instance, they’ll be able to address bottlenecks and other pain points, improve efficiency, and identify new opportunities for value creation. This will also help companies build stronger relationships with their supply chain partners and other commercial leaders.
Financial professionals are often viewed as obstacles to growth, but 86 percent of CFOs say they should be actively involved in maximizing organic growth. This is particularly true for commercial teams, which need dedicated tacticians to help them see the big picture of the business and identify new sources of revenue. These are just a few of the reasons that the role of accountants – as well as the perceptions of their work – will continue to evolve.
How finance teams can influence the future
Instead of viewing CFOs and finance teams as impediments to productivity and revenue generation, their colleagues should recognize that they’re among the most effective facilitators of growth. This is because finance teams are often in the strongest position to determine where resources will do the most good, how costly inefficiencies can be avoided, and which growth strategies are likely to yield the most revenue over specific time frames.
For example, a key finance function in the supply chain sector is rebate management. Rebates are designed to provide incentives for suppliers and distributors to work together – they reward loyalty and growth, drive collaborative behaviours, and so on. Instead of merely managing rebates, the most successful finance professionals in the supply chain sector are rebate strategists – they use forecasting and other analytical tools to identify which rebates will give both partners the best returns. This will improve the bottom line and strengthen relationships between supply chain partners.
It’s long past time for companies to start treating finance teams as the valuable strategic partners they are, especially in the supply chain sector. This means automating transactional tasks that used to fill accountants’ days and reorienting finance teams toward business strategy and revenue generation. Over the next several years, the companies that make this shift will have a significant advantage over their competitors. In the meantime, the idea that accountants do not add value” will quickly be forgotten.
Top Stories3 days ago
IKEA stores owner Ingka starts on first New Zealand store
Top Stories3 days ago
UK house prices fall by most since 2009, higher rates to bite-Nationwide
Top Stories3 days ago
Hungary looking for ‘friendly’ co-investor to acquire Budapest Airport
Technology3 days ago
Technology driven disruptions in the financial services industry