As technology continues to shape the business landscape, CFOs navigate an increasingly complex environment of technology solutions to make informed and strategic decisions. Here are five key areas to help guide today’s CFO towards investing in the right technology for their business.
So many solutions, so little time
With countless software platforms available for businesses today and not enough of them offering a one-stop solution for businesses’ financial reporting and data management needs, signing up for several just to meet a simple set of requirements is a common misstep among business leaders today.
An average group financial manager oversees several functional areas, including management accounts, budgets, forecasts, year-end, cash flow and tax, and will likely need to implement several specialist software solutions to manage these processes. However, many of these solutions will typically include a large number of functions and features they don’t need. These unused features amount to unnecessary expenses in terms of maintenance and how finance teams are spending their time.
Work smart
It’s important to consider whether the software solution in question caters for how you work (the steps required to achieve a desired result) and not just what you are working on (the specific processes being managed). This is because, very often and especially in finance, the steps you take in completing one specific process are exactly the same for many of the others in a business and, problematically, many software products charge extra for these ‘additional’ processes.
A budgeting process, for example, and a management accounts process can be considered similar in nature. During a budgeting process, you will need to be able to import actual data to your budget packs in order to compare your forecast to prior year, and then you will need to capture or calculate your forecast.
Similarly, during the process of assembling management accounts, the same steps occur, where you need to import actuals to your management accounts packs, and then capture or calculate your forecast (as most organisations now compare their full year budgets to their latest forecasts).
You follow the same steps. You’ll always need to import data from one or more sources. You’ll always need input and commentary from various stakeholders. You’ll always need to perform calculations based on new and historical data, and you’ll always need to analyse the numbers and present it in various formats.
It’s not efficient or cost effective to pay for two different software products or have to pay extra to activate the additional features within a product when needed. You should only have to implement one software product that automates how you work and costs the same, whether you use it for one or all your functions.
Don’t fall for ‘nice-to-haves’
Choosing the right financial reporting software is a lot like buying a new car; you wouldn’t buy one based solely on its warranty – while it’s being touted as a unique offering, you already know that a warranty should be included in the purchase of a car by default. Instead, you would begin by considering what you need from a new car, then what it looks like, how practical it is, and how economical or affordable it is.
Similarly, you shouldn’t implement a software solution based on the provider’s promises around final outputs – the ability to drill down into information, or the ability to create visually appealing graphs and reports, for instance. Like vehicle warranties, these are often ‘sold’ as nice-to-haves but are in fact standard features in any reporting software solution worth its salt.
Instead, make sure providers are able to illustrate how the software works to get you to these final output stages and, importantly, make sure you can get there by yourself once they and their expert technical skills have left the building.
Solving (real) pain points
A bit of extra pleasure doesn’t always mean less pain. It’s no use being able to produce beautiful dashboards and reports if you still spend just as much time as before, if not more, collecting data, or maintaining software features you never needed.
We’ve seen how people move closer to where they work, because they no longer want to commute long distances, only to end up taking just as long to get to work, because the new route includes far more intersections and single lanes (hello, Sandton). The little saved on fuel is spent elsewhere and is soon forgotten, but you are still left with the same pain.
Ask yourself: does the solution reduce the time and effort needed for the entire data collection process?
Don’t compromise on customisation for the sake of automation
Imagine needing to furnish your whole house. What many reporting tools will do is drop every piece of ‘furniture’ you ordered in the garage, often unassembled. You will need to pay extra for the training required to be able to assemble and move the furniture from the garage to where you need it to be or pay extra to have it done for you. And since you are in finance, you will need new furniture often, so you decide to pay them extra to stick around and help with your changes on an ongoing basis.
Now imagine you have a system that can deliver the assembled furniture directly to the exact location in every bedroom of your house while accounting for the various inputs, commentary and approvals coming from those in the living room and other areas of the house. This would, of course, be a much easier and more cost-effective approach.
Any viable or growing business will at some point – and continuously – be forced to look at deploying technology to maintain or improve efficiency within every functional area of its business. As clients grow, so too do the activities and volumes of transactions.
That being said, no two businesses will ever need the exact same functions and features that a software package may offer, and their users will never understand or use the software in the same way. The processes, skill sets and risks within each business will always differ.
Author
Alwyn Pretorius, BComm Accounting / Business Management, is the General Manager of Infinitus Reporting Solutions
The ability to customise is, as a result, critically important. You need to be able to custom fit and tailor a solution to your organisation, to your people and with consideration to the skillsets available, the unique risks faced by your business, and ultimately your intended unique outcomes.
