It is no understatement to say that most – if not all – businesses are currently facing extremely challenging times. And despite many countries in the Asia-Pacific region having done well to ‘flattened the curve’, risks of a second wave of COVID-19 infections as lockdowns ease and the ongoing wait for an available vaccine means that business revenue will remain comparatively lower in the near future as people are discouraged from leaving their homes to transact for business. I, for one, have not set foot into the office for the past 10 weeks and will probably not do so for another six more weeks at least.
No matter when things ‘end’, the way we work and live will fundamentally change now and in the future.
As finance professionals, the next logical questions for us are: what can we do about things being different today, tomorrow, next month or even next year? How can we help make the businesses we serve more resilient to the current economic downturn brought about by the pandemic?
Part of the answer would include the adoption of software-as-a-service (SaaS) or cloud-based technology.
Cloud Technology Integral to Success During Businesses’ Pandemic Response
While cloud-based enterprise software like Microsoft Office 365 and Slack, videoconferencing platforms like Skype for Business and WebEx, and cloud accounting software like SAP Business One have been in existence for almost a decade or more, adoption in the understandably risk-averse world of finance has been relatively slow. The COVID-19 pandemic, however, has very quickly revealed how working through the cloud and having instant access to data anywhere with an internet connection, can allow organisations to better respond to change. In fact, recent data from McKinsey shows that we have vaulted five years forward in consumer and business digital adoption in a matter of around eight weeks.
According to a recent State of Accountants survey by SmartVault with more than 1,100 accountants, bookkeepers, and tax professionals across 18 different countries, 62 percent of respondents who felt that their firms are successfully responding to COVID-19 were more likely to already be using enterprise cloud-based technology. Those who identified themselves as being less successful in their response to the pandemic have also highlighted that their organisations are now putting more energy into incorporating new technology to enable remote work and communications with team members and customers.
In short, cloud or SaaS accounting software is a convenient tool where the application is hosted by a service provider and paid for through a monthly subscription. With data no longer having to physically reside in local computers in the office, cloud technology curtails the inconvenience of on-site installation and ongoing maintenance of hardware or on-premise servers – all of which are difficult to implement during current times.
Cloud accounting software has the following benefits for all companies, especially small- and medium-sized businesses.
Remote Accessibility for All Things Accounting
First and foremost, cloud accounting solutions like SAP Business One provide all the features and functionality of desktop-based software without the hassle of worrying about regular hardware or software upgrades. With a company email address and password, authorised users can access the system from any place where there is a computer running an internet browser, including smartphones or tablets. A company accountant can therefore securely access the company’s financial system, as well as relevant files and data anytime and from anywhere.
Apart from enabling staff to work from home more efficiently, cloud-based accounting systems encourage collaboration by providing the option of having team members access common systems and work in files simultaneously. Where COVID-19 has wreaked havoc and forced employees to be home bound for weeks on end, a cloud-powered solution helps organisations keep all accounting- and compliance-related matters up to date.
The Ability to Work Faster and Smarter, and Better Track Budgets
Once an organisation has implemented a cloud-based accounting solution, they unlock a secondary benefit – the ability to exchange data electronically with other entities or financial applications. The interface and functionality of SAP Business One, for example, connects to external financial institutions like banks and credit card companies, allowing the automated setup of outgoing payments and the recording of incoming payments.
During a period of social distancing or social movement restrictions, this alleviates the struggles of finance team members having to print relevant documents, procure envelops from home, and then leave home to mail them out (and risk exposure to the coronavirus). Beyond safeguarding employee health and well-being, the greater business benefit is the entire finance process being digitised and automated, with data available for analysis at the click of a button.
Let us take bookkeeping as another example. Many of us would agree that bookkeeping consists of some of the most mundane, monotonous and tedious accounting tasks and we often become frustrated with the time taken for everyday billing, invoicing, and transaction reconciliations, not to mention the high possibility of human error during manual data entry.
Automated cloud accounting software provides relief from all these and ensures that it is done with perfect accuracy. With the fast exchange of electronic data, a company should be able to have near real-time access to accurate financial data about their business. For small and medium business owners, such software reduces the time spent on bookkeeping and is a cheaper alternative to hiring an external bookkeeper.
Finally, as COVID-19 has clearly demonstrated, when times are tough, having the ability to keep a closer eye on budgets, expenditures and forecasts become even more crucial. By having financial data pooled and accessible via a single, cloud-based accounting system, managerial accountants will have enough business information regarding things like the inflow and outflow of cash and tax filings to quickly assemble and track a budget model.
All in all, the presence of automated cloud accounting means being able to focus on more value-adding tasks, such as proactively informing and evaluating business strategies and performance management.
Extending Beyond Finance and Accounting into Other Business Functions
In addition to automatically importing bank transactions and sending invoice reminders, cloud-powered platforms like SAP Business One allow the plugging in of additional applications or modules. These include employee expense tracking, sales transactions, inventory management and even the facilitation of employee payroll. In each case, the overarching enterprise resource planning (ERP) interface allows financial data from multiple business functions to flow in near real-time directly into the company’s general ledger – and at a marginal cost.
Organisations can then further automate processes using cloud-based robotic process automation (RPA), where one piece of cloud-based software interacts with other software to complete tasks automatically, such as fulfilling e-commerce orders.
SAP, for instance, has been investing in RPA and machine learning technologies since 2018 to help its customers remove repetitive tasks from back office jobs like data entry, accounting, human resources, and supply chain management. These roles regularly require predictable tasks that are ripe for automation, such as collecting data and shunting it between different systems.
The Financial Setup for a World Forever Changed
COVID-19 has no doubt made the current business environment extremely hard to navigate. In the current landscape, decisions based on accurate data and sound insights are imperative for keeping businesses alive and resilient.
Fortunately, cloud accounting technology is more affordable than ever before. During this time, some governments are going above and beyond to offer financial stimulus and highly subsidise their local companies’ adoption of e-payments, e-invoicing, as well as more advanced digital tools in an integrated way. Companies like SAP are also offering open access to technologies to help support businesses and address the global challenges related to the fight against COVID-19, as well as free training for how to best utilise solutions like SAP Business One.
Business has undoubtably become more difficult. However, it is easier than ever to get the help and support needed to keep a business well now and poised for future growth. In fact, according to the Accountancy Age, 78 percent of small- and medium-sized businesses are expected to solely rely on cloud technology by the end of this year.
In a world forever changed by the pandemic, finance teams that emerge at the forefront will be those that are physically dispersed but yet have digitised, standardised, and centralised finance functions in place to collaborate, remove errors, minimise low-value work, align with organisational strategies and offer timely insights for optimal business planning and performance.