Behind every successful business is a competent accounting department with responsibility for incoming and outgoing cash as well as financial strategy and statements. Anything that hinders their efficiency could have an adverse affect on the smoothing running of the rest of the business.
For this reason, several organisations strive to increase finance team efficiency wherever possible. From streamlining certain processes to implementing new technology, there are a number of potential approaches available.
Here are six suggestions:
1. Reduce manual processes
Manual processes are not only incredibly time consuming, they also require a lot of effort from a staffing perspective. This is why it makes sense to adopt an accounting system that automates complex tasks.
Whether its generating reports, calculating profits and losses, creating invoices, submitting tax forms, or recording and saving transaction details, automation has the power and potential to revolutionise your accounting, resulting in much improved efficiency.
2. Outsource IT tasks
With the managed services market forecast to reach nearly $300 billion by 2023, knowing which IT solution would actually increase your accounting efficiency has become increasingly difficult.
One option is hiring an off-premises managed IT service. Along with eliminating costly staffing overhead, you can also ensure your technology footprint is implemented and managed properly.
3. Employ lean principles
Despite the fact there is no silver bullet to manage finance teams effectively, McKinsey & Company suggests that lean management principles can improve both the efficiency and quality of your accounting department.
Actionable ways you can employ lean principles include focusing on what external customers value most, solving one problem at a time to reveal new opportunities and addressing the root cause of accounting issues.
4. Create a culture of collaboration
The importance of collaboration isn’t limited to accounting. In fact, companies that promote collaborative working are five times as likely to be high performing according to the Institute for Corporate Productivity (i4cp) and Rob Cross, Edward A. Madden Professor of Global Business at Babson College.
But how do you create a culture of collaboration? First and foremost, you need to establish a sense of purpose – why is it important, how can it help the business etc. Try to avoid using common accounting and finance terms too, as confusing jargon will sound like a foreign language to many.
5. Conduct regular employee training sessions
Have you ever sat down with members of staff and gone through the processes they perform on a daily basis? There is a strong chance you’ll witness ways of working that are inefficient, redundant or unnecessary.
After you’ve reviewed how your employees do things, you can start to introduce and implement better processes through regular training sessions. Any gaps in skills and knowledge can be filled while simultaneously improving efficiency.
6. Align reporting cycles with business needs
Businesses that report on a quarterly basis often run into difficulties because their system cuts off entries at odd dates. By changing to monthly reports, and paying employees twice a month, you could add a lot of efficiencies.
Wherever possible, try to align reporting cycles to better meet the needs of the business. Otherwise you could be making things more complicated and less efficient than they need to be.