6 simple strategies to boost finance team efficiency
Every CEO and CFO wants their finance teams to perform with maximum efficiency and productivity. In practice, achieving this goal can look quite different from one company to the next. Developing the best workflows and processes requires a thorough understanding of your team members and how they work. This leaves many companies wondering: what are fool-proof ways to boost the performance of any finance team?
In this article, we share six tried-and-true best practices to improve and optimize your finance team’s efficiency–without the need for disruptive internal restructuring or massive budget increases.
The strategies we're highlighting below are key takeaways from the guide below. To get the full insights on building and supporting efficient finance teams, download our complete ebook for free:
Now, onto the highlights!
1. Identify your efficiency killers
Knowing your strengths is as important as knowing your weaknesses. Boosting efficiency starts with identifying which steps in your existing process might be holding you back. Here are five common productivity blockers that finance teams of all sizes struggle with:
Paper-based finance processes: Handling paper wastes time, leads to errors, and doesn’t scale. It’s closely tied to our second key efficiency killer, and should probably be the first thing to go if you want to be more impactful.
Manual data entry: Thankfully, few businesses rely solely on paper these days. Supplier invoices, receipts, and even mail from the tax office all need to be digitized, but plugging in data by hand is time-consuming and increases the risk of costly mistakes. In short, manual data entry should be a last resort - not the status quo.
Lack of automation: Going digital creates compound gains. You can take the most manual elements of an accountant’s work day and do them automatically, often instantly. No more need to build complex ledger files and enter countless rows of data. Key formulae are built-in, and you create reports in just a few clicks.
Insufficient integrations: Finance teams need one source of truth, wherever possible. Continually separating finance processes from one another (e.g. invoices, expenses, credit cards, and payroll) can create knowledge imbalances or extra work to connect the dots. Centralizing your finance workflow saves the team time and money.
Reliance on 1:1 communication: Any processes that rely heavily on face-to-face communication are no longer viable. Rather than just implementing remote-friendly work policies, you need processes that help stakeholders share the information needed upfront, long before you close the books. The more asynchronous and natural this becomes, the better.
2. Eliminate paper processes
Let’s dig a bit further into the importance of normalizing paperless workflows. We know that paper processes of virtually any kind slow you down and create hurdles for teams.
Case in point: The COVID-19 pandemic forced companies to work remotely. And those who needed physical access to files, resources, or people, simply couldn’t work. Many accountants - both in-house and external - couldn’t close the books. You couldn’t imagine a worse time to cut off from financial records.
The pandemic also jump started another trend: remote work. For knowledge workers, remote flexibility is now the default expectation. And that goes for finance teams too. If you need paper receipts or purchase reports filed physically in trays, you lack that flexibility. You likely even hurt yourself in the job market.
By prioritizing digital transformation, not only do you remove errors and move faster individually, it lets you automate whole processes and accelerate across the board.
3. Automate low value tasks
As evident from the Great Resignation, burnout is rampant throughout businesses and finance teams are no exception. A recent study found that 40% of finance professionals planned to leave their current roles, citing an unfulfilling and overwhelming workload as the chief reason. The lack of automation was also noted as consistently holding finance teams back.
The two are clearly connected: automation reduces the manual work done by individuals. And without it, busy periods like financial close quickly become overwhelming.
Which processes to automate
There are countless processes in the company that can be improved with automation. It can be overwhelming to decide where to start. A good rule of thumb? Have a plan, before you execute. Making any kind of operational change should be done with proper preparation and planning, as multiple stakeholders are usually involved.
Here’s a simple strategy to incorporate automation into your operations smoothly:
Identify your most repetitive, low-value tasks. These could be manual data entry, but also individual email reminders for missing receipts, or building meticulous reports month after month. Does your team’s experience and intuition add anything to these particular tasks? If not, it can - and probably should - be automated.
Find the right tools. Read reviews, ask peers, and do a few product demos to find the best tools for your team. Your ultimate goal is to reduce time spent on repetitive tasks.
Repeat these steps before making a purchase. While not all your problems can be solved with one tool, you might be able to tackle a handful at once. For example, company card spend and expense reports admin actually stem from the same root: payment methods at work. And the best tools will fix both at once.
Choose and implement your automation. Consider the level of communication you need to have with other stakeholders. Make sure all users are on-boarded appropriately and can easily follow the new process.
New tools take time to ramp up, and you’ll likely hit a few snags along the way. Don’t forget to monitor your implementation progress and ask your team for feedback after a few months.
4. Invest in better tools
The fintech landscape is filled with new and exciting technology, mostly for the better. But not every piece of software is fit for every business.
The “right” tools for you depend on your company size and growth plans. New tools are always an investment in both time and money, to get them up and running smoothly. The truth is that there’s almost never an instant, overnight success.
Always take the time to assess what your current needs are, and how that will change in the short and long term. Concretely, that means focusing most on tools that fit you now and will scale with you as you grow.
That being said, sometimes you’ll still go through trial and error. Even if all your research points to a specific tool that seems perfect for your company – but you quickly realize your team hates using it – that’s a valid reason to change to a better solution.
5. Encourage asynchronous communication
The “new normal” for corporate culture is now remote friendly and flexible. You can’t rely on in-person communication to answer every little question. That means hiring strong communicators and flexible workers, and emphasizing remote-friendly communication methods.
It also requires a new mindset: embracing open, long-lasting communication in place of one-off conversations.
Asynchronous communication is crucial for growing teams across different time zones, because people won’t be available the moment you need them. And that’s not a bad thing. Those “quick questions” quickly mount up, especially at month end. It can be challenging at first, but asynchronous, open communication is often more efficient and sets clear expectations for others.
Focus on centralizing work communication on public platforms within the company. That could be using public Slack channels or Notion pages to provide updates and information instead of email so that everyone can see it, in one place.
The biggest benefit is that these messages are designed to live forever. Document something simple but critical once - like your company’s travel expense policy - and the content will be accessible and available to all, without long email chains or chasing colleagues.
6. Embrace a customer service mindset
The closer your ties are with other business units - particularly sales and marketing - the more effective your finance team will be.
Finance teams want company growth just as much as sales teams. Sales force effectiveness and retaining profitable customers are the two most effective growth drivers, even more than reducing costs or entering new markets. And you can have a genuine and positive impact on this effectiveness with clean data and shared insights.
Most importantly, the finance team needs an open understanding and flow of information back and forth with other units. You can help them understand what they’re doing well to grow revenue, and they can provide timely data and documents to make your life easier.
The goal is to involve finance in the decision-making processes across your organization. Not just as a checkpoint, but rather to open new possibilities towards efficient, strategic growth.
Upgrade your finance team optimization
Increasing your finance team efficiency with these six strategies is a great start, but the best optimization strategy isn’t “one size fits all”.
Every business is different, so it’s essential to identify your biggest pain points and priorities when executing a revamp of your finance team’s processes. Reaching maximum efficiency is a combination of getting the right people and the right tools - the right systems - to fix problems.
Streamlining your workflows also gets easier when you choose tools that consolidate your most relevant tasks, like spend and expense management. Spendesk is a 7-in-1 software with corporate cards, invoice payments, expense reimbursements, approvals, budgets, reporting, compliance, and pre-accounting in one simple scalable solution.
Take it for a spin to see how you can save time and money instantly, across the entire spend process.