As the spread of Coronavirus (or Covid-19) has effected businesses financially and has caused great damage to the stock market, the world is in danger of a global economical crisis. And whilst there’s not much for some businesses to do, every single company can definitely benefit from updating their objective and goals for the rest of 2020.
During these times, the most important thing to do as a manager is redefining the priorities of your business. Many companies need the help of their finance department to reset objectives, determine the updated forecasts and re-assign budgets.
To be able to make sure your teams will still experience a productive year, we will dive into five different elements that are important for re-setting your business objectives for your teams in 2020:
1. Reduce risk
In most businesses, the most common goal for the finance department is how to reduce or mitigate risk. The finance department is in charge of ensuring that the spending is responsible, that team members within the business do what they’re supposed to, and to keep the company safe in a financial manner.
For smaller companies or startups businesses, it’s important to create an easily followable process to ensure every employee in on top and aware of their spending.
For better cohesion among finance rules as well as other departments, it’s important to consider that whilst the finance departments work better with rules and regulations, employees in other teams need convenience and simplicity.
So as a manager, it’s important for you to redefine your company’s spending processes to ensure that its simple, and keep them on-policy as a matter of course.
Company Expense Management tools such as Haslle are a great example.
When a team member needs to use a budget, they simply log into the platform via the mobile app or through the web app and follow the steps.
As the manager, you get to build the policy, budget limits, and approvals processes into the system, so your employees don’t even require training to know the rules.
Build managerial approvals into spending management tools
The best example of managerial approvals is company spending. You have employees spending on behalf of the company, or sometimes for work-related expenses for themselves- either online, with a credit card, or out in the field. In any scenario, they should have approval from a manager before a dollar is spent.
But the finance teams within any given business, have very little control over this.
Classic spending methods such as buying with credit cards and expense claims, aren’t designed with control or simplicity in mind. Once a spender has the card in their hands, you rely on honesty and a strong company culture to keep spending in check. And the same for expenses – you have to hope that they follow the rules, but you won’t know until the claims come in at the end of the month.
This is why expense management tools are recommended. Especially spending methods – that have approvals built in. Even with a card in their hands (which you assign to them), you can actually withhold funds from employees until their manager has given the green light or even easier, set a limit on budgets so they can’t even access the funds before a budget raise approval has been issued. Which keeps managers in control of their budgets, and finance in control of overall spending.
And this doesn’t have to come at the cost of employee freedom.
2. Reduce friction
The tighter your control on company spending, the more hoops other team members have to jump through to actually spend money.
The most obvious example of this is the way some companies protect the company credit card. If a team member needs to pay online – a new software subscription, for example – they have to personally visit the finance team or even CEO to get the card. This way, the keeper of the card can ask all the questions and have any type of forms they desire filled by the employee before a purchase is done by the company card.
This whole bureaucracy slows the company down and decreases time efficiency.
Frankly, employees want freedom and trust. They do their most efficient work when they feel free to make decisions. But at the same time, you can’t give everybody open access to the company bank account and credit cards, there still needs to be an approval process that works for your company and ensures the appropriate purchases.
To increase productivity in teams, you need a way to let employees move quickly and make decisions, but with the ability to set limits and stop unwanted transactions.
Give team members hands-on access to these systems, but with limits in place to keep finance in control.
3. Monitor spending in real time
Visibility and data are so important for finance teams. If your main goal is to remain in control of company finances, how can you do that if you only see spending at the end of the month or quarter?
It’s important for your finance manager to know at any given point how much budget is left and how much is spent.
Does your finance manager currently aware of the money spent this month to this very minute?
The answer is usually “no.” Or at best, “maybe a rough estimate.” And in many cases, by the time you know what the business teams have spent, it’s too late to do anything about it. Which is where time efficiency comes in once again.
Getting better real-time data allows you to build a modern finance team to be on top of every outflow or inflow of the money at any given time.
As we’ve seen, traditional expenses are a problem because you don’t know what’s been spent until claims are submitted. Credit cards are similar, especially when you have recurring payments – you may have committed to transactions that haven’t yet been processed, and have no idea.
Finance teams need data about all operational spend available at once, in one place. In reality, this requires payment methods that are connected to a central platform or system. This way you can see spending as it happens, from anywhere, with real time data analysis that multiple different expense management apps can offer you.
4. Save time and increase accuracy
To ensure you correctly put in date once, without redoing the process and checking it, it would save your employee, and yourself so much time and energy.
And over time, data quality in general improves considerably.
What you need is automation. And in particular, automation of a few specific tedious spend processes:
If you’re going to use expense reports, it’s best to minimize the amount of admin and bureaucracy that comes with them. Rather than having employees fill out an Excel sheet ( or feel out a form), send it to their manager for approval, then forward it on to finance (who then has to manually enter all the details), wouldn’t it be much more time-efficient if they submitted all this digitally?
Modern expense management tools like Haslle let the user input their claim directly into the system. This includes the reason for spending, the manager who approved it, and even the receipt itself.
All finance has to do is export this data to their accounting tools. No data entry at all.
End of the month is a famously difficult time for finance teams.
You have to take data from a whole range of different systems and departments, reconcile it all, and ensure that your books are accurate by being balanced.
Every single month.
The big hassle here is having all those different data sources. You also have important documents like tax receipts that need to be digitized and then matched up against payments in your ledger.
This is where automation is so valuable. First, if spending data is digitized from the beginning, there’s no manual entry for finance teams. This will help save so much time and effort and will help increase the efficiency and productivity of your finance teams.
Automation = accuracy
If you manually enter every expense report yourself into Excel or your accounting tools, you can be sure that the data is accurate.
In fact, human error is one of the biggest problems in everyday accounting. Humans make mistakes over time, but software and machines execute the same tasks in the same way, every time. This lets finance teams from on from tedious manual data entry, to focus on more important review and validation roles.
Automation gives you more accurate data, and gives you the time you need to do more important work.
5. Homogeneous systems
This is more of a principle than an overall objective.
But as you plan your processes for 2020, keep this in mind:
If every company process works a different way, everyone has to learn every process.
It’s quite simple, if processes confuse people, people won’t follow them.
So instead, try to put in place systems that work the same for different outcomes.
Essentially, everyone just ends up doing things the way that makes sense to them.
Which is why we recommend you run all operational costs through a spend management platform like Haslle. Employees only need one process to pay with business expense cards, make expense claims, ask for budget increases or submit invoices.
That means less onboarding and training to new systems, and fewer errors overall.
This approach is also far more scalable. As you open new global entities and welcome more and more team members, they all have the same spending process to follow. They just need to log in.
We hope you have benefited from this article on how to define objectives for a productive team in 2020.
*Simple, clear objectives for your finance team*
Now that you are reconsidering the objectives for your company, you should:
- Automate tedious, repetitive processes
- Build policies into systems, so employees can follow them organically
- Free other teams to do their best work
- Move away from policing and become a better business partner