Recently there has been much discussion in the world of small business financial management about the role of connectivity in operations. While industry influencers advocate becoming a ‘connected business’ to save time and expenditure and improve processes, this idea leaves many small business owners feeling confused, overwhelmed and intimidated. So let’s break it down a little:
What is a ‘connected business’?
In a connected business, software and machines take over processing tasks and human effort is saved for thinking and deciding. In a connected business, this technology collects data and advice from across the world to improve strategy and day-to-day decision-making to reduce risk and to optimise current and future profitability. A connected business has core management software tools communicating with one another with little or no human intervention, and these tools allow businesses to connect digitally with key advisors, clients and suppliers.
Importantly, a connected business reduces the replication of data, which in turn:
- Frees up people to do more important things like thinking and decision-making
- Reduces errors in and the creation of disparate data due to human keying errors
- Keeps up with the pace of modern business by making important information used for decision-making available instantly
The ‘connected business’ in the future of Australian small business
According to workplace analysts, the future competitive landscape for all businesses is one where machines (including Artificial Intelligence robots) will do most of the manual labour and data processing, while humans will be freed up to focus on our core capabilities including analysis, thinking and interpersonal consulting skills.
Although this future may seem distant from the current business reality, many of the world’s leading businesses are introducing these systems now and businesses all over the world will need to start thinking of how they will follow. Luckily, the price and ease of implementation of this technology is now at a point that it can be leveraged by most SMEs. This means an SME can start working towards a connected business by looking at the automation of as many systems and processes as possible, freeing up their human talent for thinking and looking after customers.
How can a small business become ‘connected’?
For a small business, there are many ‘easy wins’ available that do not require a lot of capital or time. For example, your business can:
- Automate your accounting function as much as possible
- Build a digital link between your financial advisor and your business so that you can work on a single source of truth in real time
- Embrace “the internet of things” to monitor all of your important systems
- Use the internet to outsource skills you need from around the world (for example, a virtual assistant in a different time zone who can type up your client notes and quotes while you are asleep and have them in your inbox the next morning when you get to work)
- Send and receive all of your invoices between clients and suppliers digitally
- Connect your front-of-house systems directly to your backend accounting and ordering systems
- Set up your monitoring software to alert you to important changes in your business so you don’t have to constantly check
For many small businesses, accounting software and add-ons like REEP are the keys to these quick and easy wins. A modern accounting system, which is accessible to your advisor via the cloud, is capable of doing three things:
- Automating a large amount of your financial data processing
- Automating and speeding up the work of taxation compliance
- Freeing up time with your business advisor to work on the important future financial decisions in your business
The combination of a cloud-based accounting system and these add-on financial management tools will give you an idea of the benefits of operating as a connected business. Amongst other benefits, they:
- Monitor the current state of your business against your forecasted strategy in real-time
- Free up both your and your advisors’ time from the drudgery of financial processing work
- Give you the time and energy to focus on the future profitability of your business without having to look back on your financial past
- Give you live information anywhere, anytime, allowing you to make better collaborative business decisions that reduce risk and increase profit
- Give you the time and the information to deliberately construct and monitor your future business success
Reep online budgeting connects to your accounting system to build a powerful shared financial forecasting system and provide a single source of financial truth. To experience a connected business in your small business, contact us today for more information.