Sage research has found that small businesses are spending an average of 120 working hours a year on administrative tasks. It revealed that an average of 5.6 percent of staff time in each UK-based small business is used doing back-office tasks, because firms do not have sufficient systems to deal with them. It also unveiled that if productivity was increased by the same amount, an extra £33.9 billion could be added to British GDP each year. The time spent on accounting administration was the most prolific, amounting to more than 20 percent of total administration time.
Adaptive Insights VP of United Kingdom and Ireland, Rob Douglas, argues that the lack of investment in technology to handle these routine tasks will lead to less business analysis and agility to respond to a particularly challenging and changing market. He comments:
“Small businesses simply cannot afford to spend an average of 120 working hours a year on manual, administrative drudgery – especially as the UK heads for Brexit. This time could be better spent on analysing performance and preparing for different scenarios as the UK faces a time of change, with trade agreements and legislation all set for alteration. A lack of technology – including that of sufficient planning systems means companies will struggle to know their current situation, let alone plan for the future.
“It is no surprise that companies are spending so much time on administrative tasks. Finance teams are under increased strain as businesses demand more from them at a faster pace. Finance can often spend days or even weeks manually rolling up data from across organisations, leaving little time to analyse performance. What’s more, the time and money spent on manually inputting data into spreadsheets can be wasted, as it often includes multiple data and formula errors. Ultimately, this leads to a lack of trust in the data and, as such, business decisions can take much longer.
“With faster financial modelling processes, UK small businesses will not only be able to save time and money on manual, back-end tasks, but they can strategise using accurate data, as well as utilise ‘what-if’ scenario planning to be prepared for the unknown – vital during Brexit negotiations and consistent currency fluctuation. In terms of the economy, and Sage’s prediction that better use of this time could amount to an extra £33.9 billion contributed to British GDP each year from small business, the ROI of new systems will be music to the ears of those worried about the repercussions of Brexit.”