Financial Capability Improvement Explained

Financial Capability Improvement Explained

Every organization has to be able to constantly improve its accounting, billing & invoicing and cash-flow processes in order to be able to make decisions quickly and get healthy and safe finances.

Without healthy finances, great visibility and transparency, even the companies with the best product can go out of business. That is why the first major pillar of business capabilities are the Financial Capabilities. 

 

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Business Capability Improvement via Digital TransformationDigital Transformation plays a huge role to enable Financial Capabilities by creating visibility for executives, remove double entries, catch mistakes, automate processes and enable productive work.  

The three categories/processes of Financial Capabilities are Accounting , Billing & Invoicing and Cash-Flow . Digital Transformation can improve these critical capabilities with a high return on investment.

Financial Capability Improvement

Accounting Process ImprovementAccounting Processes are important in order to promote smoother operation, better visibility and improved decision making of the business.  The challenge is to automate as much as possible of these tasks in order to reduce labour cost, input errors and improve visibility. 

The main areas of potential improvement:

  • Bookkeeping – Less manual work and better relevancy of data 
  • Bank – Less manual work and better aggregation of all bank transactions  
  • Inventories – Less manual work and better accuracy of inventories 
  • Payroll – Less manual work and better compliance and communication with employees 

Improvement on these can result:

  • Less labour cost – reduce the cost of the processes 
  • Faster closing time – faster executive information 
  • More visibility – better decision making 
  • Better communication – internally to management and employees 

Recommended Digital Transformation Discovery Project:

Accounting Process Improvement Discovery Workshop 

  • Accounting Reconciliation Processes 
  • Expense Management and Approval Workflows 
  • Bank integrations with Accounting Systems 
  • Reporting and Analytics 
  • Payroll Processes 
  • Inventory management

Billing & Invoicing Improvement

Billing and Invoicing Processes are important in order to promote better client experience, smoother operation and better cashflow.  The challenge is to set all the necessary detailed information internally and the agreements with clients so the process can be automated. 

The main areas of potential improvement:

  • Offering – Easy and effortless decision making for a customer 
  • Contracts, Agreements – Easy and effortless legal process 
  • Proposal, Check-out Process – Easy and effortless purchase process 
  • Invoicing, Collection – Smooth and efficient online invoicing, payment and collection 

Improvement on these can result:

  • Improved Sales – easier to understand the value and the purchase process 
  • Quicker Sales Cycle – faster agreement, invoicing and collection process 
  • Improved Client Experience – effortless buying process 
  • Improved Internal Delivery – smooth and effective service delivery or product shipping 
  • Improved Cash Flow – better decision making 

Recommended Digital Transformation Discovery Project:

Billing and invoicing Process Improvement Discovery Workshop 

  • Sales Document Management 
  • Product Catalogs 
  • Proposal Systems 
  • E-Signature implementation 
  • Online Payment System Integrations 
  • Online Invoice management 

Cash-Flow Management Improvement

Cash-Flow Management is important in order to have healthy financials, less business risk and less executive stress.  The challenge is to collect all the needed information together and keep updated in order to plan, forecast and manage cash-flow. 

The main areas of potential improvement:

  • Financial Planning – Easy ways to plan Quarter and Annual Planning of P&L and Balance Sheets 
  • Financial Forecasting – Easy ways to forecast 7-45 days of operating cash-flows  
  • Financial Reporting – Regular Reports and Alerts in order to make decisions and reduce stress 
  • Improve receivables and payables – handle shortfalls and control the cash effectively 

Improvement on these can result:

  • Improved Confidence – planning and see the reality for course corrections 
  • Improved Control  handle shortfalls effectively with payables and receivables 
  • Improved Teamwork – relevant information and insights to be on the same page 
  • Improved Financial Health – better decision making, better finances more cash on the bank account 

Recommended Digital Transformation Discovery Project:

Cash-Flow Management Process Improvement Discovery Workshop 

  • Financial Dashboard integrations 
  • Financial Report integrations 
  • Financial Alerting 
  • Financial Planning support 
  • Financial Forecasting 
  • MS Excel Pivot Tables 
  • MS Excel OLAP 
  • MS Power BI 

 

Put all this together 

If you are experiencing business capability challenges – growth, productivity, profitability or competitive. This might be due to an unresolved a business – technology area (failed digital transformation). There is a predictable journey for small and medium size businesses starting with a Dx Readiness leading to a direction and clarity. 

 

Donny Shimamoto – Certified Digital Advisor in the Honolulu, Richland area

 

 

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