A room full of busy and seemingly productive people is generally seen as a good sign. But if your staff are using inefficient and outdated tools, they could be used for greater effect in your business.
Are your finance and administration staff busy manually entering supplier invoices? Manually coding entries for bank reconciliations? Using ‘off system’ spreadsheets to produce management reports?
Such processes lead to double handling in data entry and accompanying data entry errors. Worse, your accountant has to rely on back up files to perform their work, adding further time and cost.
Use benchmarking to track performance
Having a set of financial goals for your business is not enough. You also need to identify benchmarks. This means having key metrics that determine how your business is doing. Benchmarking also provides the standards for comparison between previous, current and future performance.
Benchmark metrics can help you asses your performance needs – it provides information and insight on what weaknesses you need to improve on. Monitoring these benchmarks helps you predict the probability of falling short or reaching your goals.
Utilise cloud-based accounting systems
Financial tools can help streamline processes.
Every major software package runs a cloud-based solution. And that cloud-based solution offers a number of advantages for the business and the business adviser. Programs like Xero allow you to look at the same screen as your adviser whilst being in two different locations.
You can still communicate with your accountant or bookkeeper outside the office. All you need to do is call them and you’ll be able to look at exactly the same data. You don’t need to create back-up data because your accountant can view it in real time.
These systems can increase efficiency and make evident areas of over resourcing. If your administrative burden decreases, you can focus your staffing investment in value-adding or revenue-generating roles.
Cloud-based systems are accessible everywhere. That means you and your team can keep on top of things on the go. You can also explore other options for how your administrative functions are performed, such as outsourcing and offshoring.
Cloud systems also typically operate on subscription models meaning the days of expensive on-premise capital investment should be largely behind you.
The attractiveness of Xero is that they’re the market leader. There are always going to be limitations with cloud-based applications; they tend to be fairly narrow in their functionality. Xero’s approach is that to be vertically integrated. They encourage their add-on partners to enhance the core functionality of the Xero platform. Xero focuses on providing the accounting system and making it great. And Xero is suited to a lot of businesses.