As the pace of business accelerates, the modern finance department must adapt to keep up.
Finance departments are changing and modernizing business practices to streamline corporate structure. These changes help businesses operate more efficiently and effectively.
As the finance department becomes a more strategic force, CEOs and other leaders must understand how their finance teams operate. The changes have been drastic over the last few decades, with the advent of technology transforming everything from accounting processes to strategic planning.
Let’s explore how modern finance departments change how businesses operate and what CEOs can do to keep up.
Automate, Automate, Automate
Automation has been around for years, but advances in technology have helped it gain traction recently. It’s the process of using software applications to simplify or complete tasks for you.
It’s an increasingly important part of operating a business that teams can apply in various ways. From automating repetitive tasks to streamlining processes and helping you better understand your customers, the modern finance department has countless third-party apps available to automate some of your financial tasks.
When you rely on manual processes, there’s always room for error if something goes wrong or someone makes an error while performing their task.
But when you automate your systems, your workflows are more consistent and reliable, freeing up time to focus on more important things. You know the work is getting done without worrying about doing it yourself, whether sending out an email or processing payments.
The benefits are clear: setting up automated systems can save you time and money while providing a better experience for your employees and customers.
Focus on Data Collection
Data tells the story of your business, so it’s essential to collect accurate information. The modern finance department focuses on gathering data, from keeping track of payments to vendors, employees’ salaries, or the profitability of specific products and channels.
Having accurate and up-to-date data will help you move your business forward.
For example, accurate sales figures from previous years will indicate how much revenue to expect from current sales efforts. It helps you measure the impact of specific marketing strategies, allowing you to adjust accordingly.
Good data collection is also essential for creating reports and making critical business decisions. The more information you have about your company and its operations, the better decisions you can make about its future direction and success.
Make Sure Your Team Has a Solid Understanding of Your Vision
The finance department is an essential element of any growing business. You must have a team that understands your vision, has the education to work with the new tech, and willingness to help you get there.
Everyone in the company needs to know what you expect from them and how their role fits into the big picture.
The financial industry is changing rapidly and becoming more efficient at every turn. But these developments can sometimes mean change for people experienced with the old ways. Although these changes bring new software systems to make things easier for everyone involved, occasionally there’s a learning curve.
Explain the importance of why you are doing what you’re doing and how it will improve the business. If you’re implementing a new system or process that will change things in your financial department, get everyone on board by explaining why this will benefit the company.
Don’t Expect Your New Systems To Work Right Away
Once you decide to modernize your finance department, it’s time to make a plan and get started. But don’t expect everything to work right away.
The transition from a traditional finance department to a modern one can be time-consuming, and your team might need time to adjust. While you can take shortcuts by bringing in someone from the outside, there is no substitute for internal training.
Further, keep an open mind. You might need adjustments on what you thought would work.
Organizational dynamics often change as new systems come into place. Direct access to critical information may become unavailable, or staff members may not understand how the new system works.
These challenges can cause confusion and frustration among staff members who feel left out.
As your business grows, your financial department needs will also grow. Whether it’s an increase in transaction volume or complex reporting requirements, your organization’s complexity might increase or require additional resources.
Turn to an Expert To Help You Build a Modern Finance Department
The modern finance department is no longer just a team of bookkeepers.
Finance is an integral part of the business, ensuring that the company has the proper financial structure and systems to run smoothly. Outsourcing is a great option to explore if you want the benefits of a modern finance department but don’t have the resources to hire a full-time team.
Outsourcing creates space for you to focus on what matters most: growing your business.
If you’re curious about how a modern finance department would benefit your company, look no further than Founder’s CPA. We will work with you to create a customized financial plan that meets your needs. Contact us today to get started.