Finance operations efficiency: 7 ways to slick up your department

Finance Operations appear to be under constant strain, with a continual requirement for teams to be more efficient and perform more with the same resources (or less).

So how can you supercharge your finance department and make some time in your day to do those value-add tasks that you really enjoy doing?

We’ve put together a list of the 7 best ‘big wins’ that can really transform your finance operations department and help you make the jump to the next level.

In this post;

This has to be the very first thing you need to do if you want truly slick finance operations.

Instead of asking yourself how you can do something quicker or easier, ask yourself “Why are we doing this?”

It’s no surprise that in many organisations there are a lot of tasks that are being done just because they have always been done.

If you are producing a report then ask the recipient what they use it for and if it is still useful.

If you are entering data onto a system then trace where that data goes and how it is being used.

And if you find yourself spending hours every week filing bits of paper then ask yourself why you aren’t paperless.

If there’s no good reason for a task to be done then you need to …

This is one of Elon Musk’s favourite sayings and it seems to have stood him in good stead.

His view is that if you haven’t reached the point where you think you’ve deleted too many processes then you still have some work to do.

Now whilst we wouldn’t advocate deleting things until the wheels fall off, there is a lot of sense in this lean-approach.

In finance, we tend to seek comfort in doing the familiar old routines to manage the daily finance operations, but a lot of the time these old routines don’t add any value, improve control or produce insight and frankly, they just need to go.

If you are having trouble asking “Why?” about all of your processes then the question has to be “Why are you trying to do it all yourself?”.

Your people have a wealth of knowledge about their jobs and the company they work for so asking them to help with the leaning down of your systems and processes is a good place to start.

Make it a finance operations team special project and get everyone involved. Get them asking why they do things and see if any overall themes emerge.

Very often you’ll find that there are whole chains of tasks that different people do that can actually be deleted, but they haven’t been because nobody ever asked the question “Why?”.

So tell your people what you are trying to achieve and then trust them to think about their own areas of responsibility.

Hint: – prizes are a good idea and chocolate works really well!

General Ledger is the heart of the finance operations system and the Chart of Accounts is the heart of the general ledger.

We’ve seen companies jump through huge amounts of hoops just to cope with a poorly designed and organised Chart of Accounts.

This often happens when companies acquire subsidiaries that have totally different COAs.

There then appears a cottage industry of accountants all frantically trying to make all the different postings match up.

Get your COAs right and you’ll find that you don’t need that cottage industry anymore.

A really well-organised COA also helps massively with reporting and you can often find that simple reports almost just fall out of the system rather than having to resort to macros and reporting software.

A word of caution here though – don’t just launch into changing things as you could find that it breaks more things than it mends.

Take some time to consider your approach and only make the change when you know what subsystems will be affected.

One of the most interesting things about finance department systems is that on average only about 50% of the capabilities get used.

We understand the problem – your company pays to have a shiny new system put in but it only pays for consultants to work on getting a minimum viable product up and running.

This means that in many companies there are loads of other things that their systems could do but they just haven’t been switched on or implemented.

So have a good look at your main systems and see if there are other functions that could be used to make your finance operations easier.

Apps are everywhere nowadays and you can find an app to do almost everything.

If your main finance system can’t do something then take a look around for an app that can fill the void.

Often it is better to use a best-in-class app rather than trying to force your finance system to do something that it wasn’t designed for in the first place.

This was exactly why we designed Rydoo – to give people a best-in-class addition for expense management that sits alongside their main systems – and of course, boosts your finance operations.

But as always, you can have too much of a good thing.

Don’t go overboard, just choose a few really good apps (like Rydoo) that can make a big difference to your finance operations.

One of the biggest drains on people’s time is getting reports out of their systems.

So often we see people spending hours just producing, checking, and formatting reports when they could be adding insight.

So once you have a really well-structured COA and you’ve deleted reporting that nobody uses then look at ways of automating report production.

This will free up your finance staff to actually read what is in the report, delve into the background and add value and insight for managers to use.

Your people then become wealth creators rather than report creators.

When you first look at making your finance department more efficient it can seem a bit of a daunting task but don’t worry – there’s a method.

We’ve presented our tips in a particular order because following this process makes the whole project much easier.

For example, if you delete processes because they are not needed then you don’t need an app to do them.

Or if you organize your COA properly then your reporting should be a doddle.

But there’s no point in spending time finding a way to automate a report if you later find out that the user doesn’t need it anymore and what you really should have done was to delete it in the first place!

Chunk your project up into manageable bite-sized pieces and do a little at a time. That way the whole thing won’t seem quite so scary and you’ll feel much better about the smaller tasks that you need to complete.

And when you get to the point where you realize you need a best-in-class expenses system to take away your manual processing then book a call and we can show you how Rydoo can revolutionize your expenses management.