COVID-19 AND THE ACCELERATION OF CLOUD ADOPTION – WHY IT’S TIME FOR ACCOUNTING DEPARTMENTS TO TRANSITION TO CLOUD-BASED SOLUTIONS

Ryan Demaray- Managing Director SMB EMEA at SAP Concur

Digitalisation is fundamentally changing UK small businesses (SMBs). Due to COVID 19, and employees being driven out of traditional offices and into the world of remote work, SMBs have increasingly leaned on cloud computing and cloud-based solutions to ensure the successful transition to a ‘from anywhere’ workforce. In fact, cloud is projected to make up 14.2% of the total global enterprise IT spending market in 2024, up from 9.1% in 2020.

More businesses than ever are using cloud infrastructure, and as an employee, you’re likely to use the cloud every day, often without even realising. Whether that’s accessing shared documents, instant messaging and even emailing, there’s no escaping the cloud. And for SMBs, it allows the workforce to seamlessly connect to one network, become more data-driven, and drive new levels of efficiency and automation.

Ryan Demaray- Managing Director SMB EMEA at SAP Concur

However, some industries, such as accounting, have been slower to move away from traditional solutions and take advantage of cloud-based technology. Relying heavily on paper-based processes, chasing employees who are working from multiple locations and relying on older systems which often lack user-friendliness and flexibility, making it harder to streamline processes and work effectively as one unit.

With the mounting pressure from a hybrid workforce, it’s time for accounting departments to adapt and become more streamlined. Below are the top reasons why organisations need to leave old fashioned and on-premises solution behind in favour of superior, cloud-based solutions:

  • A Digital Focus: We can’t continue to brush the problems with a paper-based Accounts Payable (AP) process under the carpet. We must fix it, so it works in our new world of work. Paper receipts are easily lost, damaged and rely on employees being in the office to hand them over, meaning this process is outdated and unreliable. Luckily, cloud technology can make pesky paper receipts obsolete.

Sending digital receipts, invoices and expenses automates the process to improve efficiency, (when done manually, it can take an average of 17 business days to process an invoice) and increase the chances of fast and timely payments. Employees can even use their own technology, such as cloud-powered apps on their mobile phones to take pictures of their receipts and instantly upload them into an expense claim. Opting for the cloud also means all the data is stored electronically, so accounting teams can file returns from anywhere, and do so quickly and easily.

These changes have been significant during the pandemic. For example, Barnsley Council had to switch to home working, virtually overnight. The local authority used the SAP Concur platform to enable a switch to the cloud, creating a paperless and virtual expense management system, streamlining back-office finance processes and eliminating the need for staff to present expense claims in person.

  • Transitioning from manual to strategic: Traditionally, data entry is a key area for accounting teams, for example in relation to invoices and payments. However, cloud technology can streamline this process from data capture all the way to claim processing and reporting. An intuitive user interface can also help employees along the journey and prompts action, like manager approvals, wherever employees are. This means that accounting teams can spend their time doing more strategic work that helps their organisation differentiate from competition.
  • Fraud detection: As the nature of communication changed during the pandemic, there was an increase in invoice fraud and fraudulent claims at work. With SAP Concur research revealing that employees across England would knowingly submit a false expense claim of up to £110 on average. Concerningly, the research found that over half (56%) of employees think it is perfectly acceptable to over expense or disregard company policies regarding expenses on a yearly basis. Cloud technology can ensure that fraudulent invoices are caught, reducing the risk of non-compliance and saving SMBs money in the long run.
  • Increasing visibility: SMBs need visibility on what employees are spending and will be claiming expenses for. If expenses are submitted long after they’ve been incurred and budgeted for, this can take the business by surprise and seriously impact businesses that are reliant on a steady cash flow from month to month.

Cloud technology provides visibility into employee expenses much sooner due to improved workflows, through automatically streamlining the capture of expenses and analysing trends in spending. While manually reporting this would take hours, with an automated process teams can connect seamlessly to other finance systems, like invoice, credit card and ERP information to get deeper insights into outgoing spend. It can even connect to HR and sales tools to give finance the full business picture for reporting purposes.

  • Maintenance and hosting costs are covered:Cost and effort for maintaining on-premise solution hosting, means maintenance and updates can be significant. Therefore, it’s imperative to find a cloud subscription that covers all these areas. This will ensure the programme is up to date and protected.

 

The Silver Lining

With hybrid working increasing, a new era is upon SMBs in the UK, and it’s time to implement the cloud technology necessary for an invoice and expense system fit for the modern age. The silver lining to this cloud technology is not only increased visibility and reduced fraudulent claims, but also positive staff experiences and efficiencies. The Covid-19 pandemic has had an unprecedented impact on many SMBs, but the smart use of technology is one way to tackle challenges now and in the future.

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