By Rob Israch, General Manager Europe, Tipalti
When your home is also your office, like it is now for many of us, working a 9 to 5, or in some cases longer, can be difficult. The expectation that employees are likely just metres from their computers, and therefore available at any time of the day, has added a pressure to be ‘always on’.
For finance teams, challenges presented in the shift to working from home have been coupled with an increase in workload that has come with a focus for many businesses to scale. From recent research, we know that a quarter (23%) of CFOs see international growth as a top priority. However, time is of the essence to aid and support this priority – with almost a third (29%) saying that they’ve seen more manual finance tasks in the past two years, and nearly a fifth (16%) admitting that keeping finance operations up with company growth has been a challenge.
In addition, our research with IFOL found that an overwhelming majority (73%) of finance professionals say that staff productivity and morale in the finance and AP department is a concern, and 78% say that too much manual work is overwhelming for teams. A focus on eradicating time-consuming manual tasks is key to achieve a healthy work life balance – important both for employees and business health. Research from Oxford University found that happy employees are up to 13% more productive. It’s pretty clear that happy employees will in turn help companies achieve ambitious growth plans.
When it comes to manual finance processes, accuracy is key. So when employees are toiling around the clock to keep up with the increased workload, stress levels undoubtedly rise. In fact, about a third of finance professionals ranked stress on the AP team as one of the main issues caused by processing challenges. Mental health of our teams is important – but it’s not just a HR problem – enhanced ways of working for individuals need to be part of the solution. If that is not addressed proactively, staff retention could also become a major issue bringing about an added challenge, especially given the competitiveness in the market currently.
From identifying issues in workflows and employee performance, to knowing when to leverage technology, below I explore what finance leaders need to focus on in 2022 and beyond.
Manual work is grinding the finance team to a halt
Clunky, manual workflows cause a multitude of problems for finance teams. Beyond simple inefficiencies – in which 63% of finance professionals have received feedback or criticism from the wider business on – visibility is reduced, error rates increase and relationships with customers and suppliers can be damaged if deadlines are missed. Moreover, manual work creates process bottlenecks which results in higher resource costs and a potential loss of profits. Simply put, manual processes do not scale. If the status quo is maintained, as you grow you will simply need to hire more and more staff for mundane, low value-added work, which is a poor way to run a sustainable business.
Despite the number of AP teams benefitting from automation almost doubling from 5% in 2019 to 9% at the end of last year, adoption has been slow, with only half (54%) capitalising on the technology. Without automation, teams are spending too much time processing invoices, manually entering data, chasing down approvals, processing supplier payments, and dealing with supplier inquiries. In fact, over half (56%) of respondents spend over 10 hours a week processing invoices and supplier payments. Per year, this equates to around 65 days being wasted on low-skilled manual processing – days that could be spent focused on more strategic initiatives.
Using automation to level up team morale by alleviating workload
This low-level administrative work drags finance teams down and creates the perfect pressure storm. Keeping track of rapidly changing priorities whilst juggling mundane, time-intensive work is highly unsustainable and will lead to burnout. Employees will undoubtedly suffer from a lack of stimulating work, resulting in productivity dips.
Finance leaders must recognise that automation is their biggest lifeline. The right tech stack can help them manage multiple large-scale projects while creating a dynamic, worker-friendly environment – contributing to higher morale and less stress amongst teams. Integrating automation not only mitigates the risk of high turnover levels but, crucially, it opens doors for business growth by freeing up the financial department of outdated manual processes – allowing teams to optimise the 9 to 5 by spending more time on the tasks that matter.
Amid the Great Resignation, in which employees are leaving jobs at a rate not seen in over a decade, it is crucial that finance teams are looking for ways to alleviate their employees from pressures in order to retain their staff. If employees remain unsatisfied, they will undoubtedly look elsewhere for job opportunities, leaving finance teams more exposed and hampering growth agendas.
The CFOs responsibility
Our Swiss Army CFO research highlighted that 97% of UK CFOs believe their role has become more complex in the last two years. From spearheading sustainable initiatives, to navigating the uncharted waters of Brexit and aiding international growth, they are wearing multiple hats – and they need their team to support such strategic work. Unfortunately, those that haven’t adopted finance automation are struggling to find the time – as they are heads down on processing invoices, managing approvals, making payments etc.
Recognising what tasks their team are spending too much time on, what could be improved by automation and understanding if the finance team will be able to scale successfully alongside the businesses’ growth plans are just a few areas of concern for a CFO looking to modernise their department. Identifying early signs of team burnout, such as missed deadlines and increasing employee turnover levels are also key in understanding how technology can help.
Fast growth businesses will quickly outgrow their finance teams working with outdated manual processes. As businesses scale, teams will undoubtedly suffer burn out to keep up – leading to dips in productivity and the overall decline of business operational health. The finance leaders who understand when and where to integrate automation into workflows will find a long-term solution to combat burnout and free up time for strategic initiatives.