Finance people tend to be very focused on the detail, excellent at interpreting the data, and invaluable when it comes to keeping the business on an even keel financially. But even the best FDs in the world will have found the extended upheaval we’ve all experienced in recent years difficult to navigate.
Planning ahead, forecasting the cost and impact of even the smallest changes on your business, running a cost benefit analysis to check if specific actions are the right ones – these are all examples where the Finance team can really excel by building a robust picture of what is likely to happen next. The trouble is, it all becomes significantly harder – if not seemingly impossible – to do this quickly, especially when multiple changes are happening at once and all the usual rules and constraints go out the window.
It’s been a heady mix of difficult circumstances. As well as the business challenges presented as a result of legislative changes such as multiple enforced lockdowns, working from home directives and Brexit, there has also been the immense pressure from competitive factors such as changes in requirements and wildly fluctuating demand from specific sectors. A huge increase in vacancies combined with a widespread labour shortage have added to the list of obstacles that recruitment agencies have had to cope with.
But it’s not all been doom and gloom. Some firms have managed to weather the storm more easily than others and respond quickly as the economic and operational landscape continues to shift.
Your Finance systems influence your ability to respond
How do you currently run your Finance function? For a vast number of small or medium-sized firms, there continues to be a reliance on disparate systems for specific functions such as payroll, invoicing and management accounts. This is then supplemented with a multitude of spreadsheets, often maintained and only accessible by specific individuals. This might be a workable solution during normal times when day-to-day activity is predictable and manageable. But this kind of approach does make it impossible to see the whole picture clearly – and that can be an issue in crisis mode when the business leadership team needs to make crucial decisions quickly.
Forewarned is forearmed
The second key point to acknowledge is that without a clear and joined-up viewpoint across the entire business, it is difficult to spot issues early. Nipping in the bud problems with late payments for example is only possible if the dialogue starts early. Protecting your cashflow is one of the most important priorities for FDs right now, yet it is easy for problems to fester and get worse if they’re not spotted quickly enough because there are too many other distractions happening.
Ultimately, with out-of-date systems in place, responding to any change is difficult to do quickly. And without ease of access to ALL the information along with the tools needed to interrogate the data and report back, then FDs will find it incredibly difficult to give the leadership team the timely reports and the insight they need to move forwards. There’s also the underlying concern that data pulled from multiple sources might not always be entirely up-to-date…
Don’t get caught out again
If this sounds familiar, then perhaps now is the time to invest in a joined-up solution – not just encompassing your Finance systems, but also taking into account the business operations of your recruitment firm. Specific function- oriented software, housed on a single platform, enabling data to be pulled from one central system ensures everyone is working from one version of the truth. This is the way forward for modern, fast-moving recruitment firms. It not only puts Finance in the driving seat, it also ensures flexibility for your workforce, whether that’s remote, office-based or combination of the two.