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How finance teams can use automation to save time on admin

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The UK has suffered the fastest fall in output for five years, according to the Office for National Statistics, with many blaming the economic uncertainty associated with Brexit.

The average small and medium-sized enterprise (SME) has lost more than £182,000 from its turnover, and employees have lost out on around £5,000 income each since the financial crash, due to stalling productivity in the UK.

However, almost one quarter of small firms (24%) admit they are not using electronic tools to manage what are largely repetitive, low-value processes within their finance teams. By automating these processes, it’s possible to be more efficient and productive.

Read this article to learn how finance teams can use automation to buck the trend so they can elevate the performance of the business.

The harm of spending time on repetitive tasks

Finance teams in many small businesses are spending up to a day a week on these repetitive, low-value-add tasks – which equates to a cost totalling thousands of pounds per year.

That’s all dead money that can’t be reinvested into your business.

Furthermore, the time you’re spending on manual processing is time you can’t spend on winning new business, or working on long-term strategy. And without digital records, it’s unlikely you’ll have good insight to help you plan and grow your business.

What is automation?

Automation is the way in which you can use technology to deliver manual, repetitive processes. It allows you to streamline processes, save time and money, and ‘design out’ the potential for human error and mistakes.

That means you can focus on activities that add more value, such as interpreting your business data and using those insights to drive growth.

Sarah Gardener is head of outsourcing at Shaw Gibbs, a top 100 accountancy and financial planning practice, which has offices in Oxford and London. She helps larger and high-growth businesses, and their finance teams, to implement new technologies and automation apps.

She says there are now fewer barriers preventing SMEs from applying the same smart thinking in their own operations.

That’s because many of the simpler technologies such as apps and subscription-based services cost from just a few pounds per month – a small price to pay for saving time and money – and possibly your sanity – by automating time-consuming processes.

Gardener says a sensible first step is for finance teams to map out all financial processes end-to-end. With a clear picture of inputs and outputs, you can identify ways to tweak processes to save time and money.

For small businesses, it makes sense to use an accounting software solution that allows you to manage all of your core financial processes (if you’re not already doing so).

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Six tasks your finance team can automate now

1. Job costings

Many self-employed people have to estimate and quote for work. This includes tracking inventory, overheads and labour. It can be a complex process, particularly when you have several people involved.

Before you know it, your people are duplicating effort by manually writing down data and then keying it into a system, and finance teams cannot easily generate useful reports.

Small businesses can use myriad tools to keep track – either for specific industries such as COINS Construction Cloud, or generic solutions that work for most professional services.

2. Recording planned and actual spend via a purchase order and invoicing system

Most businesses with more than one person need to implement spending controls on staff.

The traditional purchase order system allows you to effectively authorise spend by your team before money leaves your account. But it’s renowned for being laborious.

Tools such as Spendwise replace paper-based processes with use of an online system offering full visibility and management of spend.

3. Tracking mileage, logging costs and managing reclaims from clients

Forgetting to track mileage is a fast way to increase business costs. Particularly when you can offset costs of 45p per mile against tax bills.

Help is on hand via apps such as TripCatcher, which integrate with other Microsoft applications.

4. Recording expenses

Most businesses can offset allowable expenses against tax. This means that by keeping good records and receipts of expenses, you can reduce your tax bill.

But without automation and tech, it’s all too easy for your people to lose those pieces of paper – which is akin to losing cash.

Tools such as Expensify enable you to log costs and manage reclaims from clients.

5. Getting paid

Chasing unpaid and late invoices is no fun. Apps such as ChaserHQ allow you to automate this process but customise the message to preserve relationships with your suppliers.

Good accounting software will also allow you to automate this process, meaning time spent chasing late payments can be reduced.

6. Managing accounting

Manual data entry is time consuming for any finance team. And when there are other tasks that can add more value to the business, having to deal with manually inputting receipt and billing data into your software will be a frustrating job.

By automating your data entry, you’ll be able to speed up this process, saving time for more important tasks. AutoEntry is one such solution that allows you to simply email, scan and upload invoices, statements, bills and receipts.

And you can do the same with its mobile apps – great if you’re out and about.

Get the right tech for your business needs

Automation and technology undoubtedly offer exciting opportunities to cut costs and time associated with manual processes. But implementing an over-ambitious IT-led programme when it’s not yet required could be a costly mistake.

According to Sarah Gardener from Shaw Gibbs, it is not uncommon for larger firms to spend £200,000 to £300,000 on bespoke financial management systems because it’s vital to how they do business.

However, for many small businesses, that level of complexity and spend isn’t yet necessary. In addition, several solutions include the same functionality, which means you could end up paying twice for the same tools.

Gardener says: “When making decisions on IT, it’s very important to be clear on your specific requirements to avoid buying services you don’t need. It’s also important that new solutions can integrate with your existing systems, and those you plan to implement in the future.

“Implementing IT solutions can be a complex area, and one time when getting advice from an independent third party with specialist experience could be very worthwhile.

“It’s also important to remember that even once you’ve implemented automation, you will still need someone to manage the use and integration of new systems.

“Using apps is one thing but to really add value, you also need to interpret the data that comes out of them. This real-time insight helps with business planning, which is a genuine value-add.”

Summing up automation

For businesses exploring the shift towards automation, it might be wise to contact Be the Business. This is a UK government-backed, not-for-profit organisation that offers free help and advice on how to streamline processes to maximise productivity.

For more ambitious programmes, it might be worth considering outsourcing the task to an experienced expert accountant with a successful track record. Check out the Institute of Chartered Accountants in England and Wales.

Automation presents an exciting opportunity to get ahead but make sure you manage it well. As Gardener adds: “Technology is just an enabler. People will always do business with people.”

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