What is SaaS FinOps?
FinOps, or Financial Operations, have the primary objective of improving cash flow, reducing the timing of your financial close, and delivering a reporting and forecasting package for executive decision making.
Who is FinOps?
The financial operations team may consist of a sole member or be comprised of a cross-functional team spanning procurement, accounting, IT/cloud, and others. Financial professionals in both operational finance and strategic finance are involved. It may involve the management of diverse processes such as facilities management and procurement.
The core is typically a Controller, Accounts Payable (AP) and Accounts Receivable (AR) teams, Financial Planning and Analysis(FP&A), and finance leadership. It may also include members of the Revenue Operations (RevOps) and SalesOps teams.
What does FinOps do?
Drive key deliverables for process excellence, efficiency, and scalability across all Finance and Accounting operations and systems. Depending on the company, the operations and systems may not be limited to Finance and Accounting. They define and implement operational best practices and measure the impact to ensure continuous improvement. Some companies may rely on Lean Six Sigma techniques, while others aim for similar results with technology, communication and accountability. By establishing best practices, increasing automation and simplification across billing, revenue recognition, posting to the GL, closing the books, performing audits, creating financial reporting, and budget-vs-actuals, and improving speed and quality across the teams, FinOps decreases process variability to help companies scale and ultimately reduce the cost base and improve cash flow.
What does the FinOps tech stack look like?
Data, data, data. Your FinOps team needs visibility and access to data across many business processes. Getting this data should not create new workflows nor hinder current workflows. The stack must cover both operational finance and strategic finance needs. Your tech stack should integrate across functions to increase automation and centralize data. The ability for teams across the business to collaborate in the same system is incredibly powerful in that it can reduce the time to close, establish segregation of duties and automate audit trails. You will want a framework of financial controls to meet ASC 606, GAAP and IFRS 15 compliance requirements. The ideal FinOps tech stack should also allow you to take advantage of new technologies such as artificial intelligence and machine learning. Finally, the reporting or business intelligence capabilities must be easy to use, dynamic and configurable. The impact of FinOps should not be difficult to measure, predict or visualize – regardless of the audience.
Aspects include:
- Recurring Billing
- Payments
- Pre-Paid Amortizations
- Accounts Payable
- Accounts Receivable
- Professional Services Billing
- Commissions
- Sales Tax
- Revenue Recognition
- Fixed Assets
- Reconciliations
- Multi-Entity Consolidations
- Expense Management
- Financial Close
- Financial Reporting
- Forecasting
- Compliance
- Auditing
An ideal finance tech stack like Sage Intacct can:
- Cut your close by up to 80%
- Provide 200+ reports in real time or at the close
- Reduce cash flow variance by up to 90%
- Meet ASC 606 compliance at the push of a button
