By Lianne Gatti, Country Manager UK & I at Konsolidator
Optimism was high for food delivery business Deliveroo prior to the company’s IPO launch in March 2021 – and early successes saw hopes climb even higher. But this now seems like a distant memory, and it has been dubbed ‘the worst IPO in London’s history.’ Share prices fell by more than a quarter – causing the organisation’s value to fall by almost £2bn.
It seems that the food delivery sector is in crisis. Jitse Croen, CEO at Just Eat, a competitor to Deliveroo, had a net worth of $1.2bn in October 2021 – this plummeted to $350m in June 2022. Companies initially struggled to adjust to a post-pandemic world where consumers have returned to eating in restaurants and now they are finding potential customers are financially squeezed.
Deliveroo hasn’t been idle following its recent troubles. It paused recruitment across certain aspects of the business in May – with the cost of living crisis, rising inflation rates and global supply chain problems cited as contributing factors. But this hasn’t stopped the company from making changes at the top. Adam Miller announced he would be stepping down as CFO in September. Scilla Grimble – whose resume includes MoneySupermarket.com and Marks & Spencer – will take over no later than June 2023.
Deliveroo has reached a crossroads – the economic downturn means focusing on efficiency is more important than ever. But how can Grimble drive the necessary changes – and what role will technology play in the revival?
Nothing Lasts Forever
CFOs count maintaining the company’s cash flow and financial assets as their traditional responsibilities. However, the pandemic has kickstarted a transition. The CFO is becoming increasingly close to the CEO – meaning that they should spend less time collecting numbers and checking for miscalculations. Instead, they are growing to become senior decision-makers within businesses and should use this time to analyse the data and provide an insight that makes them a valuable consultant to the CEO.
Access to accurate financial data is essential. But the expectation to consult means that the CFO has less time to devote towards day-to-day financial calculations and number-crunching. Deliveroo’s primary goal is to cut costs whilst boosting efficiency – and this requires shrewd investment. Implementing sophisticated technology and automation that can handle financial consolidation can accelerate the calculation process, ensuring Grimble has a platform to make informed and strategic decisions.
Crunching The Numbers
Excel’s over-reliance on manual employee input is a major issue. Each spreadsheet is managed by a handful of employees. And whilst their understanding of how they work – and the unique data they possess – is infallible, this does not mean the system is flawless. Co-workers frequently express frustration when trying to collaborate on the platform.
Excel was a satisfactory option when the automation revolution was in its primitive stages, but its lack of efficiency is harming businesses’ transformation journeys. Human error is commonplace and financial experts can’t put their unreserved trust in a platform with a high margin for error.
Financial business leaders like Grimble need to accept that Excel is not a foolproof solution for financial departments and runs the risk of manual mistakes and miscalculations. One small error can come at a huge cost for businesses, such as JPMorgan losing $9bn, when it divided two figures by their sum rather than their average. Securing a tight hold over a company’s finances should be a priority. Deliveroo’s accounting team – and many others – shouldn’t be expected to risk their reputation and credibility within the industry due to the presence of an outdated system.
Cloud-based accounting systems – such as Konsolidator – offer a strong solution. Through automation, finance departments can gain back time to devote towards alternative tasks rather than being held back by slow and boring processes. This kind of technology can also ensure that financial teams are able to track the source of every financial figure, something that Excel has never been able to complete effectively. Harnessing cloud-based systems can augment – not replace – financial teams. Implementing automation across financial processes and reporting is the first step in a long journey towards improvement.
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Grimble will be under a lot of pressure once she takes the reins at Deliveroo. She has a huge opportunity to leverage her position and have a great influence and consultant to the CEO, Will Shu. In order to do this efficiently, it is imperative that Grimble – and her financial teams – are supported with sophisticated technology that can handle financial consolidation and enable the teams to work more efficiently.
Identifying new, innovative technology would represent an ideal start to life in a new business as a CFO. We believe that cloud-based solutions would ease her financial team’s burden whilst drastically improving data accuracy. Grimble has the opportunity to unlock greater efficiency within Deliveroo – a piece of cake with the right tools.