According to a report, top financial management personnel face the following five challenges this year:
- Earnings & Profit Margins
- Cyber Security Management
- Strategic Development
- Periodic Forecasting
After surveying over 650 high-level financial professionals – CFOs, VPs, – consulting firm Protiviti came up with the above five most pressing issues facing the finance leadership in the months to come. While most of them are not surprising (Profit Margins, Budgeting, Strategy), some concerns such as cyber security and forecasting indicate a fast-changing business environment and necessitate deep changes in operations and systems. Let’s take a look at what each of them means for the CFO and how they can be best handled.
- Earnings and Profit Margins: Whatever the business, CFOs worldwide have this as the number one goal – increasing the earnings and profit margins for their company. One of the easy ways of achieving this goal (among other, more strategic ones) is the tried-and-true approach of using modern, scalable ERP software systems – such as NetSuite ERP, a contemporary tool for financial management, CRM, Supply Chain Management, HR, and more. Not just ERP, NetSuite also offers other automation tools that are a boon when aiming for cost-effectiveness and higher earnings. For example, its professional services automation tool OpenAir helped a professional services company triple its margin by accurately estimating and forecasting resource demands!
- Cyber Security Management: Think about it – over half a billion estimated cyber security breaches around the world in 2015! (And remember, most breaches aren’t even reported, so the actual number might be even higher.) Not only are cyber attacks becoming more frequent and more damaging (think thousands of dollars in losses, investigation, and mitigation), they are becoming increasingly sophisticated.
No wonder then, that CFOs need to treat cyber security as one of their top priorities while planning their business strategy. They also need to consider that cyber security-related regulations will bear further onus on the CFO to ensure compliance with them.
Making the move to a cloud-based accounting/financials/ERP system from an on-premise one makes infinite sense in this risky environment. Older, outdated, on-premise systems are easy targets for hackers, resulting in disrupted business and loss of revenue. Adopting a current, cloud-based system such as NetSuite can be a great way to strengthen defences against cyber attacks and also to ensure compliance with the latest regulations.
Strategic Development: CFOs are constantly striving to make the right strategic decisions to enable growth and development of their organization. In today’s global, competitive, and dynamic businesses, it is ultimately the responsibility of the CFO to arm stakeholders across the organization with accurate, real-time data on financial position, profitability drivers, and performance metrics for informed decision-making at every level.
Using a comprehensive suite of integrated software solutions can help CFOs in planning, budgeting, and implementing crucial growth and expansion strategies, while simultaneously keeping an eye on capital costs. Products such as NetSuite can help in managing all the core business processes across the enterprise. Being cloud-based, not only is it immensely helpful for today’s operations, it also keeps the organization future-ready.
Budgeting & Periodic Forecasting: An extremely critical part of any business plan, budgeting and forecasting can be a complicated, tedious and time-consuming process. Aggregation, validation, analysis and approval of key financial data are needed for creation of a realistic budget. Forecasting, which must reflect the evolving goals of the company, needs to be based not just on ‘what if’ scenarios but on actual measures and drivers that really matter in day-to-day operations.
NetSuite is the fastest-growing financial management software out of the top ten in the world. Its budgeting and forecasting feature combines future projections with actual real-time data in one place, yielding a clear vision of future possibilities and options that can be compared and assessed against each other and against actual data that may change during the course of operations. Best of all, it is possible to drill down across the forecasts and budget to see the real impact of it all on business.
Apart from the above challenges, the Protivity report also states that CFOs anticipate major revision of the US tax code, which will call for expertise in accounting as well as tax management.
As finance executives across the globe try to tie together all the above aspects of a streamlined business model, they will find that having a capable partner such as Sixred can be a huge asset to their business because of the immense facilities it can provide – from software to consultation, implementation and more. Sixred’s experts have guided innumerable enterprises, big and small, to become agile and attain success and growth with their precise data, actionable insights and post-sales service.