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This article is co-written by Satu Schroderus and Anders Liu-Lindberg in collaboration with Aico.
The financial closing process is to most a process that just needs to get done as fast and efficient as possible. However, even in the digital age, many companies struggle with manual and non-standardized processes. This is expensive and increases the risk of costly errors. Moreover, it lowers data quality and hampers Finance’s ability to use the numbers for generating insights that can support better decision-making.
Therefore, many companies have an eye on improving this process by automating and using robotics and artificial intelligence. However, if you are not used to always chasing efficiencies this might be easier said than done. That is why sometimes it can be helpful to learn from companies who live and die by efficiency. That would be the global transport and logistics industry.
When margins are razor-thin every dollar counts
If there is one industry that has a natural playground in networks, making connections between A and B, it is the international logistics and transportation industry. The players in the industry must continuously optimize how to get to the destination in a most optimal way, and they have done this both in the era of digital and non-digital time.
An industry where time and cost counts, and where optimization has been part of the game basics for decades. Add to that the reality of complex local rules is creating regular challenges to solve even simple movements between A and B. As the business is known to be a generally low-margin business, the wins come from smarter and more cost-efficient operational solutions and savings; managing the whole process continuously better. Investing in equipment, continuously seeking for smarter routings, and always responding to interruptions quickly and immediately just to deliver from A to B.
What makes the industry learnings interesting to the finance function is its natural drive for standardization and optimization in a controlled and transparent way. In this way they can always keep the customer informed of the status of its shipment, thus being the best possible business partner. The combination of monitoring, focus, controls, and speed at optimal cost are all basics of Operational Excellence.
From A to B and Record to Report
We want you to think about your financial close process like a logistics company thinks about getting a shipment from A to B. Getting it done in the fastest and most efficient way. Sometimes fast and efficient do not go hand in hand but that is why we must learn from those that have mastered this process.
In principle, your record to report process does not add any value to your company. However, getting numbers fast and in high quality is in high demand. That makes numbers relevant for making faster and better decisions. Hence, this should be the goal for your financial close process. Minimize the time and effort used on producing the numbers so you can maximize the efforts on using the numbers.
That is the simple essence of financial closing and today tools are easily available to make it happen. Learn from the best to gain confidence that you can realize this in your company too. We are confident that everyone from the CEO to the accounts payable clerk can see the benefit in that. What is stopping you from becoming faster and more efficient in your financial close process?
Do not forget to sign up for the webinar on 3 September at 3:00 – 3:45 PM CET where you can hear Satu speak about how to make your financial close as efficient as transport and logistics companies move shipments from A to B.
Satu is a senior consultant, expert, and interim director with a 25-year career in the international logistics industry, leading various finance and control as well as BPO functions, now helping companies with their Finance Transformation challenges.
