Our latest report; “The State of Expense Management 2022” gave us some very useful and interesting insights into how companies are using their expense systems and what level their digitisation effort is at.
One of the most interesting of these was the fact that 38% of companies have already digitised all their major finance functions and that this is the same number as in 2020.
We wondered whether this shows that many companies have finished digitising the low-hanging fruit in terms of apps and systems and that they are pausing before going on to more meaty projects.
So this begs the question – what are low-hanging fruit in terms of the finance function?
In this article, we look at what things you can do quickly, and cheaply, and which will make the most impact; the biggest bang for your buck if you will.
What are low-hanging fruit?
So what do we mean by ‘low-hanging fruit’?
In terms of finance systems, these are apps and software that will take a short time to implement and will need fewer resources than larger projects.
Typically, they will be cheaper and often they won’t need to go through a lengthy business case and authorisation process.
And importantly, they won’t disrupt finance operations too much. In other words, they will be small, discrete projects that will be unlikely to affect the rest of the team. They also always will quickly give results in time/cost saving. There’s a clear ROI before the project starts.
Often, in smaller finance teams these projects can be managed by only one or two people and won’t require any outside help such as consultants other than assistance from the provider’s own success team.
Is it a smart move to tackle low-hanging fruit first?
Many people might think that doing finance changes bit by bit is a mistake. After all, the project as a whole feels bitty and disconnected.
It’s also true to say that if you have lots of different projects going on at the same time it can be disruptive and require a lot of resources.
But we think that there are some very good reasons why you would do easier, smaller projects first.
If you have never done projects, either personally or as a team, it is a good idea to get some form of success under your belt. Having a successful, low-impact project not only improves team morale but also builds business confidence that you can deliver more taxing systems.
If you are resource-constrained, it is often better to do what you can rather than wait for some time in the future (which may never come) when you have enough resources to tackle something bigger.
And doing smaller projects, one after the other means that you minimise the disruption to the finance team and the wider business.
Smaller, simpler projects are also cheaper. This means that if your business isn’t cash-rich, you can start to realise some benefits quickly which will, in turn, free up resources for other projects later on.
And of course, you can choose systems that are best-in-class that will do almost exactly what you want them to rather than accept a large number of compromises that might arise if you go for a single system.
Make sure you have a clear idea of the bigger picture and a clear vision of how all the smaller pieces need to fit together. This will help in defining the requirements for each solution.
The good news is that with modern SaaS systems, it is easy to implement a system like Rydoo and then link it up with other applications later on through the easy to use API.
The most important international expense report by and for Heads of Finance
How to find low-hanging fruit
So we know what low-hanging fruit are and we can see what the benefits could be but how do we go about finding them?
The first step is to look for things that take a long time to do. For example, if you have a task that used to be finished within two days of month-end and now takes five, then that could be a candidate.
If you find that you are having to allocate more people to do something or you are buying in temporary staff to get you through a sticky patch then it may be time to look at your systems.
And if there is something that regularly annoys your customers (invoicing), suppliers (payment processing) or internal staff (expenses) then this is also a sign of something that may need a new solution.
Once you have the processes that you need to digitise then you need to find candidate systems.
This may be easier said than done. Naturally, we hope you’ll choose Rydoo for your expense management but for other apps you may want to speak with colleagues, suppliers and customers and find out what they are using. There’s nothing as good as a personal recommendation.
Choose two or three different systems and measure them up against your requirements to see which is the most likely to give you the outcome you need.
It is fair to say that no perfect system exists for anything so you may need to be prepared to compromise in some cases but for low-hanging fruit solutions, you will probably find something that is very close to what you need.
Typical examples of finance low-hanging fruit
So what sort of systems can we see as low-hanging fruit?
It largely depends of course on the size of the organisation and the complexity of each area. Some businesses may need more complex invoicing for example whilst others might need a budgeting system that moves it out of the realm of low-hanging fruit.
We have to put expense management at the top of the list. After all it is what we do!
But we find that a lot of our customers start their finance transformation programme with a new expenses system.
A number of our customers get a full working system in place within 100 days and Rydoo makes big gains in the area of manual processing.
This is also a very highly visible project within the business, which means that you can wow your executives with a fully working system that makes life better which in turn improves your credibility when you want authorisation to do other projects.
Budgeting is an area that can take an awful lot of time and a huge number of businesses resort to using a cottage industry of Excel workbooks.
The problem is that this is just asking for issues with manual entry, version control and time to reforecast. This is exacerbated when businesses expand to groups of entities or start accepting payments in foreign currency.
A great budgeting solution will remove all of these problems and give you something that will make budgeting and reforecasting a doddle and should save you a huge amount of time.
Reporting is another area that can take a large amount of time but is incredibly important.
Accurate and timely reporting makes a big difference to decision making but as they grow, businesses often find this is a major problem and again, this can be much worse when there are multiple entities or currencies.
Good reporting apps will allow you to quickly gather information from disparate sources and collate them into a report and then distribute this to managers and directors.
When companies grow they often find that they have more complex invoicing requirements. This is especially the case with project invoicing, subscriptions and staged payments.
We see clients with finance systems that work perfectly in all respects except one and this is regularly the invoicing function.
A good invoicing app will speed up invoicing and can be linked to operational and CRM systems so that the whole process becomes automatic.
HR systems are important, not only because they cover aspects of people’s personal lives but also because they have a wide variety of legal obligations attached.
If you have an old system or even worse, if you have no system at all, then you could not only find yourself in a situation where you inadvertently damage staff morale but also fall foul of employment law.
Many new HR systems are incredibly easy to use and, linked to a new payroll system can speed up the whole salaries process too.
Payment processing is important for businesses and as they grow, it becomes more and more difficult and manually taxing.
If you work in a company that receives many payments from a variety of channels, recognising and reconciling these can be a really difficult task.
A good payment system will streamline both receipts and payments out to suppliers and if you connect it up to the BACS system you can take advantage of cheap fees for automated transactions.
We’ve spoken about many projects so far but how do you manage all of these different tasks?
Although this isn’t strictly speaking a finance system, using a project management solution can make a massive difference when you are trying to take advantage of low-hanging fruit.
Summary - don’t discount small projects
It is often tempting to think that you should go for an all-in-one transformation project that solves all of your finance system woes in one fell swoop.
But we think that can often be a mistake, especially where you have a team that is inexperienced with projects or where you have resource constraints.
Instead, doing a few low-hanging fruit projects can get your transformation program up and running quickly and allow your business to enjoy the benefits of newer apps speedily.
You can download our latest report; “The State of Expense Management 2022” here for more valuable insights into finance digitisation.
If you’d like to find out how Rydoo can help with your expense management and why we think this is a low-hanging fruit project, call us now and we’ll set up a free demo.