It's Time to Give Finance the Tools it Needs to Fuel Business Growth
Growth is top of mind for enterprises today.
Yet, expansions bring a host of challenges, from heavier workloads, overloaded and disrupted processes, and a larger, more fragmented workforce to unfamiliar regulatory challenges in new markets. All of this complexity increases costs, reduces efficiency and agility, and hinders progress on the ultimate objective: growing your business
These growing pains are due in part to outgrowing your business systems and processes, not just the size of your workforce. That old “people, process, technology” mantra holds true – each are part of the three-legged stool powering the modern enterprise. It’s just that today, intelligent automation, or technology, can drive process automation that empowers your workforce to do more in less time than ever before.
But from an IT investment perspective, it’s kind of a chicken-and-egg situation. You want to grow, but you need technology to ease and enable growth. Do you invest proactively, before you grow, to drive growth? Or wait until after you grow and play catch-up, with sustainable growth hindered by old ways of working? What’s the cost of waiting? What’s the benefit of investing early? And in what areas?
A new study conducted by Oxford Economics and SAP Concur sheds light on these questions. Oxford Economics surveyed 500 finance and IT executives at firms worldwide that have undertaken an expansion in the past year. Of those respondents, 350 came from companies with 1,000 or more employees.
This study found that far from being immune to growing pains, large global enterprises often struggle harder than smaller companies to manage the challenges of expansion. Their scale and complexity can make the consequences of a growth initiative – more data, more invoices, and more administration – difficult to handle. Flexibility and responsiveness when the business hits an obstacle are tougher for big companies: it’s easier to turn around a tugboat than a battleship. From this perspective, investing early in digital finance transformation to automate spend management processes – especially for employee spending on travel, expenses, and invoiced purchases – makes a lot of sense. Freeing employees from rote finance tasks allows them to do more value-added work that’s critical to driving growth. Automation can also help the finance function scale easily to handle larger post-expansion workloads without adding headcount.
In addition, the study found that having visibility into spending and paying careful attention to cash flow are pillars of successful growth. We’re talking near-real-time visibility into all employee spending across the globe – because the study found that global enterprises that anticipate their spending needs can more-easily avoid the growing pains of expansion, no matter how complex and far-flung their organisation may be. Finance can use predictive insights to redirect spending where it needs to go to drive growth – before it’s too late.
The survey results also show that cost-consciousness in general can greatly affect an expansion’s success. When we asked executives to rate the importance of spending and cash flow in their decision to expand, dramatic differences emerged between those who answered “very important” or “somewhat important.” Cost-conscious respondents – and those who answered “not very important” or “not at all important” – have more cash flow to direct toward strategic growth plans. At the same time, a focus on costs seems to improve performance in non-spending-related areas as well. For example, 62% of non-cost-conscious enterprises say they have difficulty reacting quickly when the business hits a roadblock, compared with 28% of cost-conscious enterprises. And siloed business units are more likely to be a problem at enterprises where costs were not important during expansion decision-making.
Want to learn more? Download the Oxford Economics report and learn why attention to spending in the planning stages not only reduces the likelihood that growth initiatives will incur cost overruns, but also mitigates problems in almost every area, from workforce issues to risk and compliance