COVID-19: How to digitise & futureproof Finance

With global leaders like Bill Gates believing we are only a third of the way through this crisis, the playbook for the next 6 -12 months remains uncertain.  CFO’s, Financial Controllers and Accountants need to quickly embrace digitisation into the heart of the business which will be key to building the foundations to a survive-and-thrive strategy. 

Our ability to stay connected and informed is in the palm of our hands today through smartphones.  The same needs to happen for your accounting system.  It needs to be always on, up-to-date and sharing information with the right people in the business in real time. 

My advice is to keep things simple.  You can be up and running with almost any small and mid-range cloud system in a matter of days or weeks.  But choose carefully as you don’t want to switch systems within a couple of years because you’ve outgrown it. Ideally select a system that’s right for your needs for the next 5 years or more. Your cloud accounting system should be accessible from anywhere through a browser, be fully hosted, with features such as user profiling with audit tracking, full back-ups and be updated regularly and automatically and have user support included. It’s also important that it can scale as your businesses evolves and grows. 

The diagram below depicts your Accounting System re-framed as Cloud Finance Management Software [FMS] with an API at its core, so you can connect to HMRC, Banking, Mobile Apps, Reporting tools, and other apps and systems that emerge in the future. 

AccountsIQ digitising finance functions


How to digitise and future-proof your finance function:

  1. Absolutely Go Cloud – get a real cloud accounting system that is right for your business as early as you can. Not one that is too basic or dials into a hosted solution or across a VPN. It’s that simple and you can be up and running in less than a week if you want to.  This will be the most important decision the finance team makes in the next 6 to 12 months, so don’t delay. 
  1. API Economy – get familiar with what API’s are and how they can help your business on day one and as it grows.  An API is an Application Programming Interface that allows two systems to connect securely and exchange information.  Examples that affect all businesses today are Making Tax Digital and Open Banking.  Both use standard APIs that allow your accounting system to communicate VAT and Bank transactions with a relevant 3rd party. 
  1. Automate Capture – Focus the team on automation [i.e. getting data into and out of the system with minimal keystrokes and rework]. This can be done using simple OCR connectors for supplier invoices, payroll connectors, and Point of Sale, CRM, Power BI and many other 3rd party systems.
  1. Connect your Banks – connect your bank accounts so that transactions can be matched and reconciled every day to give a true working capital position to management daily and weekly. Also, ensure you can pay suppliers using a payment function that automates the allocation of payments and a direct debit system to collect money from customers.
  1. Adopt productivity features – digital wins are small projects that are easy to test and bank small successes for the team.  Some examples: implementing purchase ordering, approval workflow, expense capture, a fixed asset register.  All will save you time every month, so the investment payback is really significant.  It also gives Finance teams social currency as influencers and advocates of change across the business.
  1. Real-time Reporting – Make sure you have the ability to report all the financial and business intelligence information to the management team and other team leads that need data to be effective.  This means being able to report a view across a group, by company, by sector, area, department, project etc.  All these reports should be visible from your Cloud FMS in real time and not exported and re-worked in Excel by one of the team.  There is no need to do that anymore and you can also use external reporting tools like Power BI that use API connections to stay in real-time contact with your Cloud FMS.

On a finishing note, there are a few recurring insights from great articles and blogs on what Finance teams and businesses should be doing right now and probably from now on:

  1. People – Really look after your employees and your customers. These are the most important people to your business and the ones that will help it thrive as we come out of this crisis;
  2. Data – Carry out scenario planning using good data across all aspects of the business so you have prepared actions as and when new information emerges;
  3. Communication – Report key metrics daily and weekly and talk to all stakeholders in the business as often as required;
  4. Technology – look at where you can add and replace technology so you can emerge fitter than before the crisis;
  5. Divest – Get rid of cost that you believe is neither necessary, nor will not add value in the future;
  6. Invest – Play offensive in your thinking.  Digitise all you can in your business model.  The technology is there.   

Read more about automating finance in my Demystifying Finance Automation Guide or my Digital Transformation series for finance leaders. 




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