Progress is usually gradual and spreads over a period of time. The pandemic, however, has changed that with several in-the-pipeline projects being initiated almost overnight. This, combined with disrupted supply chains, is unprecedented, but finance teams can help reduce the impact. By working towards stabilizing the company in the short-term and positioning it for recovery so they emerge stronger on the other side of the pandemic, they can put their companies ahead of the curve. A Gartner, Inc. survey of finance leaders earlier this year revealed that 74% will move at least 5% of their previously on-site workforce to permanently remote positions post-COVID 19.
Staying ahead of the curve can translate to remarkable competitive advantages as they learn to navigate a rapidly changing environment with the right tools at hand. In fact, research shows that the need for finance teams to come to grips with new technologies is a key priority. 21% of finance leaders advocate for investing in digital technologies which remains key but conditional on protecting the business from risk.
Concerns and Challenges
Cybersecurity breaches can lead to devastating financial consequences for companies and their stakeholders. Hence, it is imperative to educate the entire finance team and engage with protective measures and strategies against phishing, hacking, and other external attacks. Investing in robust and reliable data security and privacy, are, therefore, high priorities.
Additionally, data security compliance should be constantly monitored. Staying current with compliance laws and regulations helps minimize company risks and guides strategies to ensure continued profitability and accountability.
2. Economic Uncertainty
The pandemic has resulted in global uncertainty where the Finance teams have to deal with a deepening concern about an economic recession, disrupted operations, and altered consumer behaviour. With some companies losing up to 75% of their revenues in a single quarter, cash is now critical for survival. Client bankruptcy and non-payment are real risks that need to be mitigated.
3. Payment Delays
Finance leaders were broadly positive in a pre-pandemic setting. But that does not suggest that there were no risks or concerns. The risk that had most impacted companies over the last several months was something different: payment delays.
When asking finance leaders in May which risks had impacted them over the past two months, 65% mentioned payment delays.
Cash flow management will be key during the next months – so how can businesses deal with payment variations for an operational project? Awareness of cash reserves or shortages, along with the liquidity position, will be a starting point for identifying opportunities to protect and improve the company’s position.
Addressing the Short-term Concerns
With cashflow being the primary concern, the finance teams need to focus on managing cash, assessing liquidity, and developing diverse contingency plans based on potential scenarios.
Simplifying cash management is the first step. This further helps businesses manage multiple branches with real-time visibility and control over the branch-wise expenses.
An expense management software like Zaggle automatically forwards all the data to the book-keeping & ERP systems for accounting. This makes for a streamlined paperless flow without any controlling peaks.
This will help develop a robust framework to make business decisions and monitor conditions. The finance teams also need to be prepared with a clear, concise communications plan for both internal and external use.
1. Accelerate Productivity
Certain companies actively pursued productivity improvements during the last recession leading to increased resilience and capacity for recovery. This has resulted in them becoming disruptors in their field outperforming competitors, reducing operating costs by 3x, doubling their revenue generation over the next decade.
All this was possible because they made the right strategic moves ahead of their peers.
- Improving performance can be accomplished by promoting the development of new products and services to assist customers experiencing financial difficulties, thereby promoting loyalty
- Resources can be reallocated to support strong existing revenue streams. This will further optimize the use of alternative sales and delivery channels
- Reducing operating costs is critical, but it is also important to maintain pliancy
Reducing the hands-on time required by the finance team to process requests accelerates productivity dramatically. Zaggle Save offers a dynamic dashboard that will centralize information making it accessible and easy to see all the business expenses associated with a singular entry.
This can further help by flagging suspicious items on business expenses reports, to understand if the error was intentional. This allows finance teams to recognize details that require further review prior to escalation.
2. Digital Transformation
Using digitization to help manage the crisis should not be considered a singular event. Digital initiatives that were far-fetched such as real-time forecasts are now business-critical.
Digitization needs to occur across the organization, and stay long after the pandemic. The solutions developed need to be codified to scale up/down as per requirement. For instance, with remote working here to stay, Zaggle’s expense management software, while continuously syncing to the firm’s accounting software reduces time and effort significantly.
With quick on-boarding and instant card issuance, Zaggle Save makes it safe and simple to manage business expenses digitally. With essential settings like spend limits, categories, approval, company policies, etc capable of being configured in a matter of minutes, digital has never been simpler.
3. Increased use of Data Analytics
It is imperative for the Finance teams to understand trends in digital transformation because if done well, integrating analytics strategy into decision-making will improve value and efficiency.
To reap the benefits of data analytics, decision-making challenges need to be identified. Simulations of applying an analytics strategy to specific challenges will give a considerable idea in choosing the software that best fits with the company’s operational structure and goals.
The optimal analytics tools will aid in the analysis of current and past trends and compile insights to make informed business decisions significantly reducing the time taken. The first step towards this is end-to-end visibility over spending patterns. Zaggle ensures companies gain complete visibility over travel and expense spends while maintaining compliance and helps them find more opportunities to save money.
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Zaggle Save is an all-in-one business expenses management software that can empower your business to spend smarter and reduce time and effort. Start simplifying expense management and get ahead of the curve today.