Rob Israch, President at Tipalti
In what has been one of the toughest times in UK economic history, businesses have continued to show resilience. However, with businesses bracing for Reeves’ national insurance tax hikes in April, they will need to find ways to stabilise operations even amidst uncertainty.
The UK economy unexpectedly grew by 0.1% between October and December, offering renewed hope. However, for UK businesses to realise sustainable growth, effective financial management will be essential for any chance of long-term success.
While stability is the primary focus for many businesses right now, with the right strategies, sustainable growth is still within reach if they take advantage of the data and insights from the finance team.The finance function plays an essential role in identifying the right timing and strategies for growth. However, this is only achievable when real-time information is easily available, empowering confident decision-making and swift course correction where needed.
Even though growth will be challenging this year, here are key strategies businesses can adopt to stay on course.
Reducing bottlenecks in finance operations
Growth is the ultimate goal for any business, but it must be managed carefully to ensure long-term sustainability. Uncertain times present an opportunity to eliminate inefficiencies and build a strong foundation for future success.
A significant bottleneck for many businesses is the finance function’s reliance on manual processes for invoice processing, reporting and reconciliation. These tasks are not only time-consuming but also introduce errors, delays and inefficiencies. As a result, finance teams become stretched thin. Our recent survey found that, on average, over half (51%) of accounts payable time is spent on manual tasks – severely limiting finance leaders’ ability to drive strategic growth.
Repetitive tasks such as data entry, reconciliation, and approvals require considerable time and effort, slowing down decision-making and increasing the risk of inaccuracies. Given the critical role that finance plays in guiding business strategy, these inefficiencies and errors create significant roadblocks to growth.
The pressure on finance leaders is therefore immense and while 71% of UK business leaders believe CFOs should take a central role in corporate growth initiatives, they are simply lost in a sea of manual processes and number crunching. In fact, 82% of finance leaders admit that excessive manual finance processes are hindering their organisation’s growth plans for the year ahead. To remedy this, businesses must embrace automation.
Harnessing automation for sustainable growth
By replacing manual spreadsheets with automated solutions, finance teams can eliminate administrative burdens and focus on strategic initiatives. Automation simplifies critical finance tasks like bank feeds, coding bookkeeping transactions and invoice matching. Beyond this, it can also help alleviate the strain of more complex and time-intensive responsibilities, including tax filings, invoices and payroll.
The benefits of automation extend far beyond time saving, to accuracy, improving business visibility and enabling real-time financial insights. With fewer errors and faster-data processing, finance leaders can shift their focus to high-value tasks like driving strategy, identifying risks and opportunities and determining the optimal timing for growth investments.
Maximising investment potential through greater efficiency
Once businesses have minimised time spent on administrative tasks, they can focus on the bigger picture: growth and securing investment. With access to cheap capital becoming increasingly difficult, businesses must position themselves wisely to attract funding.
Investors favour lean, efficient companies, so demonstrating that a business can achieve more with fewer resources signals a commitment to financial prudence and sustainability. By embracing automation, companies can showcase their ability to manage operations efficiently, instilling confidence that any new investment will be spent and used wisely.
Economic uncertainty provides an opportunity to reassess business foundations and create more agile operations. Refining workflows and eliminating bottlenecks not only improves performance but also strengthens investor confidence by demonstrating a long-term commitment to financial health.
Additionally, strong financial reporting and effective cash flow management are crucial to standing out to investors. Clear, real-time insights into financial health demonstrate resilience and highlight a business’ resilience and readiness for growth.
The path forward for sustainable growth
Sustainable growth remains possible with a clear strategic approach, despite the economic challenges UK businesses continue to face. Enabling finance leaders to focus on high-level decision making and strategy will allow organisations to be resilient and agile against poor economic conditions – making sure they are able to sustainably grow with confidence.
UK businesses have had to grit their teeth for long enough. Now is the time to adopt smarter, more strategic financial management, ensuring resilience and paving the way for long-term, sustainable growth -no matter the economic climate.
