Adam Zoucha, MD EMEA, FloQast
It’s no secret that people, businesses and industries have been affected by the current economic climate. The combination of post-pandemic life returning to “normal” and the war in Ukraine is rocketing food and energy prices. As such, September saw inflation rise to a 40-year high of 10.1% and the Bank of England announced the nation was already in recession.
Economic uncertainty is tough for businesses and learning to adapt and overcome periods of volatility is critical to survival. For the majority, the obvious survival tactic is to pinch pennies and search for ways to cut back. Traditional cost-cutting strategies tend to call for freezing non-essential spending, reviewing business costs, or even lowering headcount. Making the right decisions are difficult, especially in fast-changing situations. Here leaders may be conflicted – overcutting could stunt company growth, while hesitance to cut could jeopardise business survival.
Among those feeling the heat are finance teams, who must satisfy increased demand for accurate reporting whilst battling with tightening budgets and possibly headcount. Scrutiny on spending may result in pausing, postponing, or even cancelling modernisation programmes, with leaders resisting the adoption of new practices. But those teams burdened with repetitive, manual processes will be unable to offer the agility and speed leaders need when navigating an uncertain economy – so where does that leave them?
The current climate
The accounting function is already under immense pressure – weighed down by manual and siloed processes, accuracy and delays are more prevalent at month end. In fact, Controller’s Guidebook: Burnout in Accounting – Understanding the Problem, Leveraging Solutions revealed 85% of respondents needed to reopen their books once in the past year to correct errors.
Errors are frustrating and correcting them is incredibly time-consuming. Having to reopen books causes huge delays, meaning insights take longer to reach leaders. In an era where companies need to be extra agile, that’s a delay they can’t afford. Digital transformation helps to ensure accurate data is available at speed. Leveraging tools to accelerate accountancy processes will alleviate stress points and increase the finance team’s capacity to share strategic insights to support leadership.
Do more with less
As workloads increase, leaders may consider increasing headcount. However, in the face of economic slowdown, headcount may be frozen with leaders being forced to look for alternate ways to increase the productivity and effectiveness of their teams. Concerns already surround the resource gap in the accountancy sector – trends highlight staff shortages and high turnover due to increased demands. And research shows accountants are feeling the burden as 99% of accountants reported experiencing chronic workplace stress.
It is clear the industry is being stretched and teams are feeling the heat. The challenging economy will only worsen this. Technology is one solution that can offer support by improving efficiencies and facilitating better data to lift some of the overload from finance team’s shoulders, helping boost morale and improving retention of this precious skill set.
…..And, do it better
Businesses simply cannot afford to remain complacent during these times and moving away from broken legacy processes is crucial. Here, workflow automation stands to be a key solution; adopting tools that can facilitate leaner and more accurate figures.
Improving traditional processes will drive other efficiencies for departments outside of finance such as sales, IT and marketing. Greater cross-team collaboration will increase productivity, transparency and improve the Close process itself by illuminating bottlenecks and hold ups earlier. Accountants will be able to report on time and with confidence. CFOs can free up finance teams to focus on more strategic aspects of the job, optimising precious human talent. Not only will productivity be increased, but automating parts of business will achieve longer-term cost saving – even in a downturn.
Unlock potential with investment
With all of this in mind, turning to automation becomes increasingly logical. In a challenging economy, leaders require a faster-time-to insight, and access to accurate financials is more critical than ever. Businesses must invest in processes which make reliable data easier to access and processes seamless. While headcount is limited, automation will ensure the accountancy function becomes shock absorbent.
It’s easy to lose sight of the bigger picture when times are tough. But, pushing ahead with investments that improve workflow, will help companies to stay on course in stormy waters, allowing your business to grow and push past competitors.
Global Banking & Finance Review
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