by Kendall Hoyd and Sharon Hoyd
In our recent discussion, we explored a framework for assessing the progression of your financial reporting from a "Misleading" state (not very effective) to a "Strategic" one. This spectrum signifies the journey from a tool you might not use much to a resource that not only facilitates business growth but also maintains stability during periods of change.
In the introduction to this series, we highlighted essential elements that must be present for a finance and accounting function to be considered strategic, supporting both day-to-day decision-making and strategy execution. These elements include:
1. Financial Reporting at Stage 4 or 5 (out of 5).
2. A Digital Environment.
3. A meaningful Financial Plan.
4. Management insight from Financial Analysis.
5. Pricing Analysis.
In this segment, let's delve into the Digital Environment.
1. Where the processes involve physical paperwork, with documents printed and filed manually the work environment is Analog. Even if digital tools for accounting, estimating or other functional work are used, the workflow remains analog.
2. An environment where documents are converted to PDF format, processed via email, and stored on the network is one that it Digitized. Although data, documents, and workflow are in digital format, the workflow requires a lot of moving between applications, opening emails and documents and way too many screens and clicks to get simple tasks done.
3. A fully Digital environment involves two key components: workflow automation and integration.
Workflow automation means documents and related tasks are automatically routed to the right team members based on predefined roles and process requirements.
Integration eliminates data duplication and the existence of "off-system" repositories.
Implementing a digital environment no longer requires a massive investment or a lengthy implementation nightmare. Today's software is more accessible and configurable, with affordable workflow automation tools that can quickly adapt to your existing processes.
The key benefits of a digital environment include:
Lower labor costs across various functions, including sales support, project management, customer service, purchasing, administration, and accounting. It can cost 25 to 35% too much to operate the administrative aspects of your business in a non-digital environment.
Faster access to relevant management information, facilitating quicker decision-making. When the feedback cycle is shorter, course corrections and process improvement come much faster.
Efficient onboarding and training through structured work processes, ultimately reducing turnover and easing growth-related strains.
Reduction in errors that often come at process hand-offs, plus automated reminders that prevent tasks from slipping through the cracks.
Advanced software systems with workflow automation capability are rapidly developing integration with AI capabilities. In the near term, this is going to pave the way for further improvements in efficiency that are remarkable, and a meaningful competitive edge.
With a modest investment in both software and implementation, you can enhance short-term operating results and position your company to thrive in the evolving era of business software. Our expertise in both technology and business processes can assist you in this seamless transition.
Transform your company's financial performance with Misura Consulting Group! Our expert team specializes in guiding businesses in the residential construction supply space from the world of Analog to the Digital Environment, utilizing workflow automation and integration. Develop the skills necessary to implement these key tools into your arsenal; doing so allows for faster access, efficient onboarding and training, reduced errors, and lowered labor costs. Contact us today for a tailored approach that unlocks your organization's full potential.
Think Strategically,
Kendall Hoyd and Sharon Hoyd