Long-term business success means keeping pace with a continually evolving world. Between new products, new competitors, fluctuating markets, changing customer demands, global crises, and more, expecting the unexpected is the new normal.
Technology is critical to maintaining business stability and agility in any situation – but like everything else, digital transformation is a journey of many moments of opportunity.
It’s very tempting to look at digital transformation projects as having a clear start and finish. Not only does it provide a sense of control, but success is often measured when a project is perceived as ‘complete,’ the budget is no longer allocated, and the project team is disbanded. It appeals to our innate sense of tidiness. Not to mention, it’s really satisfying to check off that ‘to-do’ box.
But that’s rarely the typical, or even best, strategy. Digital transformation projects, particularly large-scale ones, often start with just a few steps and then evolve as the journey continues. You gain knowledge, better tools become available, additional budget gets allocated, and more opportunities – or challenges – present themselves.
These individual moments all combine to create your busines’ journey. There is no ‘finish point,’ but instead, you continue to shape and improve the systems that drive your desired outcomes.
That can mean managing the cost of expense reports, optimising the hybrid work experience, or improving your travel and expense processes.
Finance automation a starting point
Often, the big question facing businesses contemplating digital transformation is, “Where do I start?”
For many businesses, the answer lies in finance automation.
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Recent market disruptions and changing work environments and lifestyles have almost certainly prompted a change in how you interact with customers. Perhaps you are connecting with them remotely, finding new distribution channels, or allowing them to pay in new, more convenient ways.
Whatever the case, you have most likely already taken your first steps toward digital transformation. But if your employees are still using paper and e-mail-based processes for travel and expense management and vendor invoicing, then you are missing a critical moment of opportunity to take control over business spending, improve cash flow, and prepare for the future.
The first step in your digital finance transformation should be to evaluate where you are today.
Figure out where paper and e-mail are still being used to track and manage spend and spend-related communication. Also, examine your ERP system to determine whether the functionality you have is delivering the near-real-time spend insight and streamlined payment processes you need.
Finally, take a look at where and how your employees work to see if your systems are giving them the flexibility to stay productive, whether at home or in the office.
Timely business benefits for a slowing economy
Once you have all these processes mapped out, it’s time to determine what’s working and what’s not. Travel and expenses are a great place to start.
Ask your people about your expense reporting process – how long does it take, how often are there errors, and how much time do managers and accounts payable (AP) staff spend to chase down missing submissions and approvals? How long does it take people to get reimbursed?
Next, examine your vendor invoicing for the same issues of simplicity, speed, and accuracy, and ask yourself whether lost invoices, late payments, and missed discounts are impacting vendor relationships and your bottom line.
Finally, check in with your finance teams to see if they have the spending visibility that they need to prevent wasteful spending, improve cash flow, and align spending strategy with your business goals.
In addition to considering spending processes, you will want to examine spending policy. This includes measuring out-of-policy spending as well as your employees’ familiarity with the spend policy.
You need a spending policy that covers the full spectrum of your spending activity while also delivering the desired business impact of reduced errors, greater cost savings, stronger security, and increased compliance. Spend policy should be easy to find, understand, and apply – and should ideally be built right into your spend management processes.
Now that you know which problems need to be solved, it’s time to rally your people and get them on board with implementing a solution.
Your stakeholder list should include leaders, managers, and people on the ground from accounts payable, procurement, HR, finance, IT, and any other department that deals with spending processes regularly.
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By bringing all these people together, you will be able to ensure a clear understanding of how digitalising your spending management can improve process efficiency, visibility, cost control, cash flow, security and compliance, and employee satisfaction. Not only will this help demonstrate the need for change, but it will also ease the transition to your new automated system.
For those who are still on the fence or feeling nervous about change, remind them that digital, cloud-based spend management can save finance and accounting employees many hours per week while also giving them the freedom to do their job from anywhere and an opportunity to divert time saved into more strategic tasks.
For the conservative budget hawks, be sure to present a cost-benefit analysis that considers all the money you will save by reducing errors, curbing out-of-policy spending, and increasing remittance discounts – not to mention the savings that can be uncovered through greater spend visibility.
As for IT, make sure they know that any digitalisation plan includes partnering with a reputable vendor that can provide the support they need for a smooth rollout and operations going forward.
With the right digital transformation strategy and automation technology, firms can fret less about the uncertain economic climate, as they will become more agile and productive at a lower cost.
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