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How can finance systems help with cost control?

9th Jan 2019
Brought to you by
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The Access Group provides integrated business management software.

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Have you found this content useful? Use the button above to save it to your profile.

Cost control is a key strategic goal for many finance teams.

Whether you’re in a difficult position as a company and need to make reductions or you’re simply seeking to maximise shareholder income by boosting profits, there are plenty of reasons to perform cost control exercises.

While a good financial software package won’t solve your cost control problems overnight, it can make a good start. Here are some ways that finance software packages can help you to achieve your cost control aims.

Identify waste 

Finance software packages these days can do much more than simply file your company’s tax return for you. By making the most of modern algorithms, they can smartly assess your company’s outgoings and identify areas that could use some scaling back.

Employing a member of the finance team to do this isn’t just expensive in terms of staff time but also raises the risk that errors will occur, and that manual rekeying will be required. With software, this risk is virtually non-existent.

Cross-departmental thinking 

All too often, finance is siloed within an organisation. It ends up being seen as the job simply of the finance team, rather than something that everyone can contribute to – and this leads to difficulties, especially in the realm of cost control.

However, by collaborating, this problem can be solved. Take the example of human resources. It’s not usually in the role description of an HR team to spend significant amounts of time identifying areas where detailed HR cuts can be made, but they may well be the best team to help. 

If your finance system pulls data from all different departments, it can assess the relationship between, say, staff turnover rates and onboarding costs and find out if there’s any scope to make a change. Also, with accurate data like this, you can see how you’re performing compared to other firms: the average staff turnover rate in the UK, for example, sits at 15%, so you can assess with ease whether you’re particularly low or high. 

Upfront investment 

For many finance team leaders, though, the main barrier to opting for cost control is the upfront cost that it requires. Ironically, many teams end up choosing not to opt for finance systems because they appear to break cost control measures already in place.

However, finance software systems can often end up paying for themselves several times over, especially if they mean that you don’t have to employ a person to do the jobs that the software can do for a fraction of the price.

Cost control is an integral aspect of many business’s strategy plans, and it’s essential in a variety of circumstances – not just when times are hard. However, it can be a cost drag in itself, especially if a staff member needs to spend time on it.

By investing in a good-quality finance software package that can range over the many different aspects of a business’s operations, your firm will be able to scale down spending in a precise, pinpointed and accurate way.

To find out more about how to monitor costs and grow your profitability read our Protecting Profitability whitepaper.