CFOs, whose positive relationships with leadership can benefit an organization, have seen their roles expand and transform in recent years. Nowadays, CFOs are tasked with being impact leaders, planners, facilitators, and skeptics — keeping the ideas and organizational goals in the realm of financial possibility for the business.
Despite waning concerns about a recession, in a recent survey, 90% of executives said looming economic uncertainty has significantly elevated the CFO’s importance to the organization. The recent study, by market analysis firm IDC and payments provider Billtrust, included just over 600 executives surveyed.
Cash, Invoicing Challenges
While new technologies found at recent events put speed and reliability at the top of priorities, many organizations are still stuck in practices that are hurting their ability to efficiently collect invoices. According to surveyors, nearly a fifth (17%) of all invoices on average are paid past their due date. While this not only can create difficulties in managing allocations and creating budgets, it can also hurt relationships with suppliers, and create incentives to do business based on speediness of payment and not quality of product or service.
Over three-quarters (77%) of all respondents said improvements in these processes are critical to their organization’s survival. As many CFOs are forced to make time-sensitive predictions and decisions based on things like liquidity and cash flow, unpaid invoices and outstanding balances can wreak havoc for an organization looking to leverage current business in order to grow at a consistent pace.
Order to Cash Processes Need Upgrades
Surveyors said over the last 24 months, the economy has swayed leaders to be more focused on improving their order to cash (OTC) processes. While these teams are often understaffed with large workloads, efforts to make improvements, either through technology or changes in workflow, are evident in the data.
More than half (52%) of executives said payment management is an area that has been modernized in the past two years. Forty-six percent said invoicing and billing saw a large amount of change, while just over four in 10 said order management also was an area where change was needed.
Impact On Employee Experience
Talent and labor, an area that has many CFOs scratching their heads on how to best leverage, may be better off with modern OTC practices. Research shows more than half (54%) of all respondents agree the slow modernization of OTC has had a negative impact on their ability to attract and maintain employees. Almost a third (30%) of respondents also said that poor OTC management can result in a higher turnover rate than an organization with modernized OTC protocols.
As finance and accounting professionals often make their desire for technologies known, the integration of improvements in these processes has a two-sided benefit to the business. Not only can improved OTC practices increase an organization’s ability to leverage its data in decision-making processes, but it can also make their finance and accounting talent happy, decreasing their likelihood of jumping ship for an organization with better technologies or more modernized workflows.