Finding the right technology innovation – guest blog by Tim Blundy, Director at C2FO
06 June 2019
For most businesses, equal weight is applied to generating income at month end from both sales and financial accounting, as both roles share responsibility for ensuring the business achieves its goals. Yet unpredictability can squash the performance of every best laid forecast, which means more and more, sales and financial accounting leaders are looking for help managing specific metrics. Recently, the value of AI and machine learning has shown promising aspirations by turning many of our woes into wows. But true applications of this type of value is hard to find, leaving most looking for tried and tested solutions that demonstrate tangible results today.
For your treasurer and controller, their tools to manage quarter-after-quarter success have moved away from complex and detailed Excel management, and graduated to simplified and transparent technology. Benefits of this tactical shift have provided better cash forecasting and control over inflows. New technology has brought an unprecedented amount of transparency and flexibility into their roles – for the betterment of your company and your shareholders.
An example of how these types of technologies drive innovation for financial accounting teams is demonstrated by one working capital solution in use by numerous multinationals. From a single-entry point, treasurers and controllers can gain visibility of their account receivables available for payment ahead of schedule. Imagine myriad customers, each providing a list of all approved invoices in one central repository so you can view everything coming to your bank account in real time. Visibility into this information provides an arsenal of data by which your controller can make decisions on cash levels and reporting metrics. It is forecasting cash flow without the labor of managing timetables and invoice totals across your many customers.
Marry this visibility with the added flexibility of controlling when those receivables are collected. Need a bump on the balance sheet? Or an influx of cash to reduce your debt ratio? Whatever the desire may be, your treasurer and controller now have the means to manage your company’s financial destiny on their terms. And they’re doing this with just a simple technology solution – no tricks, or gimmicks or ploys. The unpredictable events that occur on a quarterly or even monthly basis, can now be managed to mitigate impact on financial performance. Before this type of technological innovation, treasurers and controllers never had any command over the uncontrollable elements. With this option, managing consistent and steady financial reports become the new reality.
In the next conversation with your treasurer or controller, ask how he or she is leveraging today’s technology to create flexibility in their role. Ask if he or she has moved beyond predictions from spreadsheets and taken up forecasting at scale with technology. Ask if he or she has a defensive strategy for the unpredictable moments that periodically arise. With each answer provided, ask to learn more and make sure you push the envelope to drive innovation that will deliver success. Technology was born out of necessity and reason, designed to make us all smarter, better and faster. It is time we each review what might be missing and find the innovations that can be true game changers.
Tim Blundy is a Director at C2FO, a working capital solutions provider, enabling multinationals with technology to manage key reporting metrics, and reduce counter party risk and debt leverage.