Business - Outsourced Finance

In today’s digital age, enterprise software has become increasingly important to the success of modern companies. From inventory management, accounting, and finance, to human resources, there are hardly any aspects of the business that have remained untouched by technology.

Enterprise systems have assisted companies all over the world to automate processes, improve efficiencies, and become more competitive and profitable. Fortunately, these great technological advancements are now not exclusively available to large multi-nationals and Fortune 500 companies. A lot of these systems have now been tuned to meet the demands of Small to Medium Enterprises. The selection and implementation of new enterprise software could be the determining factor for the success and long-term success of the company.

Here are some pointers on how your company can approach the procurement of strategic enterprise software:

Compatibility

Before making the capital investment on a new system for your company, make sure that you fully understand the software and its capabilities. The procurement of systems is usually driven by a business need. Making sure that the system/s identified is/can address the business need should be the first checkpoint before procurement kicks off. We have heard many cases of companies investing heavily in software only to later find out that they cannot use the system. It is also critical to determine if the systems identified are compatible with your existing as some systems are dependent on others to perform optimally. Reading case-studies and asking for proof of concept where possible is advisable.

Administrative Control

It is crucial to understand what level of control a new system will have on your customer and company data. To safeguard data, administrative controls need to be put in place to reduce or mitigate the risk that these new systems have to internal assets. This may include policies, procedures, techniques, or methods that can be put into place to ensure that control is never taken away from the company. The I.T department should typically be able to address these concerns. Before any decisions are made, ascertain just how much autonomy the new systems will have and who will be in control.

Data Security

With regulations such as POPI and GDPR, companies need to do thorough checks to ensure systems implementation does not expose the company and its clients to data attacks. It is simply not good enough to claim that you did not know, regulators require companies to do everything in their power to ensure the safety of data. When shopping for new systems, make sure that you understand where any data created will be stored, who it will be shared with, and exactly how the software company intends to keep this safe from external parties. Most software manufacturers will recommend regular updates and patches to be installed to ensure that you have the latest protection against malware and data breaches.

Access to Real-time Data

There is a new phenomenon where technology can empower companies to make dynamic decisions, based on the latest and most relevant data. When shopping for new systems, make sure you understand just how quickly this new system can identify trends and set up notifications that will allow you to make the best decisions given the data.

To make the best business decision when it comes to enterprise software, you need to get a comprehensive understanding of the software as well as exactly how the implementation of this software can improve your company’s performance. Do not be scared to ask questions and request more information when something is not clear.

Organisational behaviour is the broad term that encompasses the human behaviour in an organisation and the impact it has on employees, organisational structure, and management style. Thus, the type of organisation culture a firm has encourages the behaviours of those working towards the goals, vision, and mission – which could make or break a company. Company corporate culture is a result of the culmination of different beliefs, ideologies, principles, and values of different individuals in an organisation. The corporate culture of a company is a determining factor in the way employees behave amongst themselves as well as to others outside the company.

Organisational Culture  

Organisational culture encompasses the underlying beliefs, assumptions, and values of a company that contributes to the unique social and psychological environment of an organisation. One can argue that organisational culture is the underlying personification of the company’s values and morals. This culture is created by a predefined set of policies that guide employees and give them a sense of direction of how they are expected to behave in the workplace. Long term employees are the best representation of the organisational culture as they will set the tone for new employees, giving the social cues on how to behave. The work culture should unite employees and promote healthy relationships amongst employees who are from different backgrounds, families, and have varied attitudes. The organisational culture goes a long way in creating the brand image – creating a reputation for your brand for future clients and employees.

To foster growth and strength through diversity, organisational culture cannot be left to the vices of individuals to carve out. Management needs to actively work at creating and fostering a positive organisational culture that is inclusive and progressive.

The impact of employee diversity

As we live in a multi-cultural, multi-ethnic society, it only makes sense that companies need to embrace these differences to get the best out of all their employees.

Diversity can be classified into two dimensions, the primary dimension includes factors such as age, gender, race, and sexual orientation – exhibiting the main differences between individuals. The second dimension would include factors such as religion, education, geographical location, and income – qualities that are not noticeable at first glance and can even change throughout different encounters in an individual’s lifetime. Embracing this diversity is good for the organisational culture of a company, bringing perspective, humanity, and meaning to the day-to-day employee experience. Diversity encourages a work environment that allows people to be themselves and thus have more filling work experience. Employees’ diversity can generate a larger pool of opinions and ideas, for employees to bounce off and expand their way of thinking to unleash creative genius. Organisations that encourage diversity and employee involvement tend to take more risks, generate more ideas, and question the status quo – which is the most important requirement for ground-breaking innovation.

Organisational behaviour influences

There are many factors that influence the organisational behaviour shown by employees including the company’s structure, policies and procedures, management effectiveness, and interactions between colleagues. Employees are the backbone of every company, to motivate them to go above and beyond for the company a firm must find the correct incentive. Although paying salaries ensures people show up for work, positive organisational behaviour is created through more than just a salary but other motivational elements to perform to the best of their abilities. Employees feel motivated when they see a clear link between their hard work and rewards, encouraging them to repeat their behaviour. Clear and open communication can also go a long way to influencing organisational behaviour, empowering managers and employees to make informed decisions to benefit the company. People strive to fit in the environment around them, thus by ensuring the company’s vision is upheld through each interaction new employees will adopt the new culture quickly.

There are numerous reasons why diversity and culture are important for your organisation. However, the bottom line is the interactions and environment your employees are surrounded by defining what quality of output is generated. By creating a productive, healthy, and fun culture that is filled with different people and ideas, your organisation is far more likely to succeed long term. An organisational culture that embraces and celebrates diversity, both within the company and externally, will set your company on the path of attracting and retaining talent and clients from all works of life. Multiculturalism provides businesses with a limitless pool of talent, ideas, viewpoints, and opinions.

The business landscape in South Africa is constantly changing. In recent times, we have seen many companies, both locally and abroad, with powerful women leaders at the helm who continue to guide their companies to success. As Women’s Month ends, Outsourced Finance would like to continue celebrating women entrepreneurs, pioneers, and innovators both locally and Internationally.

Women for innovation

From geographical location and gender to race and ethnicity, diversity, in its many forms, has been known to drive innovation. Because of women’s different perspectives, skills, and experiences, they solve problems in new and innovative ways. Even though women in South Africa have been overlooked in business for decades, we have shining examples of powerful women who have risen through the ranks and commanded huge companies. The likes of Dr. Judy Dlamini, Pam Golding, Phuti Mahanyele-Dabengwe, and Lillian Barnard come to mind when we talk of those who have overcome many hurdles to rise to the top in their respective industries. There is an even longer list of women who have been making industry waves in their respective fields, perhaps without media attention.

Even though we have made a lot of progress, women are still grossly underrepresented in business in South Africa. We are far from the point where women and men all have equal opportunities at success. So, what is holding local women back? For starters, access to finance is a common stumbling block for women starting businesses in South Africa. Success rates for SMMEs are already low, failure to access and secure finance only means that a lot of women-led businesses do not even get a fighting chance. Women who operate in traditionally male environments may also struggle to build a network when their community is dominated by men. We need to change our entire approach of business if we are to pave a well-balanced economy in the future.

Statistics show that the business world has yet to fully bridge the benefits of women in leadership roles with actual participation and investment.

Leadership style

A total of 19 countries around the world are currently led by women, and throughout the first few months of the pandemic, most of them had in common a relative success in fighting the COVID 19 virus. A recent study revealed that some characteristics that are typical to women in leadership positions were instrumental in the success of their countries. However, in the case of the Covid-19 pandemic, they found that women were risk-averse when it came to human lives and less risk-averse to risking the economy.

Diversity is the winning formula

Balanced representation in leadership can lead to the organization making better, long term decisions. Data from more than a million small or medium-sized companies analysed by insolvency practitioners, KSA Group indicated that those with a mix of both men and women on their boards were the least likely to fail. Countless research papers that suggest that the increase of women in leadership is helping businesses to thrive in unprecedented ways.

To a large part, many big industries in South Africa remain male-dominated, perhaps the introduction of women could open the industry to innovation and different views on doing things. Women have a lot to offer the business world, it is just about not paying lip service and making it possible for more women to enter the ranks of business.

We are excited to see the future of South Africa, where women will thrive and engage in meaningful ways to the economy.

References:

1. https://voxeu.org/article/women-leaders-are-better-fighting-pandemic
2. https://www.wrapmanager.com/wealth-management-blog/the-investment-benefit-of-women-led-businesses
3. https://inews.co.uk/news/business/why-women-on-boards-are-good-for-business-339033

With the steady adoption of technology and the digitalization of the world economy, the value of data (both personal and business) cannot be understated. Gone are the days of having all the important company documents and records stored in a cabinet at the office. We have now moved towards digitally storing data, both on and offsite for regulatory reasons. The reality is that the issue of cybersecurity extends far further than what the movies will have us believe.

In a nutshell, the goal of cybersecurity is to keep data and information protected. This information can vary from contact details, banking details, or even login information to emails, contracts, and agreements. Unauthorized access to this information could result in reputational or economic damage to all parties. We have seen many cases where hackers have used data as ransom.

Our society is more technologically inclined than ever before and there is no sign that this trend will slow. Thus, the importance of cybersecurity is only becoming more prevalent, making it imperative that both individuals and companies start educating themselves on why it’s desperately needed.

The importance of cybersecurity

Whether you are a sole proprietor, run a small business, or work for a multinational organization, you probably rely on at least one technological device to carry out your work activities. This reliance creates a threat as there is important data that is stored on these devices. Cybersecurity encompasses a wide range of defensive activities including protection of personal information, intellectual property, and the industry or government information systems from theft or damage by cybercriminals. In recent years cybersecurity has become an unavoidable topic as there has been a huge increase in the hacks or attempts to access sensitive data. Cybersecurity ensures that the network is secure, giving all users the confidence that their information is safe and not at risk of being accessed by random parties.

It has become important to educate employees on the methods that people use or try to trick them into divulging information over the phone or possibly by email. As the consequences of hackers gaining access to information and stealing it could range from identity theft to the loss of millions of Rands due to a stolen product idea.

Protecting confidential information or electronic data

In today’s world, many businesses rely heavily on connectivity, whether that be websites, VPNs for remote employees, or connections to vendor systems – meaning that they are exposed to the threat of cybercriminals.

There are three simple steps that every business can take to increase security and reduce the risk of cybercrime:

1. Educateall levels of your organization about cybersecurity and social engineering scams such as phishing emails.
2. Invest in systems or toolsthat limit information loss, monitor your third-party risk, and fourth-party vendor risk. Also, your company must continuously scan for data exposure and leak credentials.
3. Make use of technology to reduce costs, such as automatically sending out vendor assessment questionnaires to judge the level of risk as part of an overall cybersecurity risk assessment strategy.

Rethinking cybersecurity

With more and more people working from home and requiring access to company data remotely, the importance of cybersecurity has become more important.

Both public and private sectors have recognized that cybersecurity is not only a function of the I.T department. Companies have started to address the importance of cybersecurity as an integral component of their business strategies. However, there is no one-size-fits-all solution or a single system that will solve all your security qualms. A successful information security program takes a strategic pairing of solutions, best practices, and staff training to develop.

As technology develops, so does the way we fight cybercrime and thus your cybersecurity should be an ongoing project, always adapting to the times and new risks. When trying to educate yourself and your team on the different aspects of cybersecurity and changing the conversation around cybersecurity, creative solutions can be found.

Cybersecurity should be taken seriously and could have very dire consequences when not properly addressed. Cyber threats can have serious ramifications for individuals, businesses’, and in some cases even governments. It’s important to remember that cybersecurity is not a one-stop destination but rather a continuous journey, an integrated approach of people, tools, implementation and proper monitoring is the only way to reach a successful security program for your business.

Digital platforms have redesigned the architecture of relationships between customers, employees, and companies, as bytes and RAM permeate almost everything that we do. From buying groceries online to finding your dream house online, computing power has drastically improved how people around the world participate in the digital economy.

This transformation is known by economists, who study changes in technology and scientific progress, as general-purpose technology: one that has the power to continually transform itself, progressively branching out, and boosting productivity across all sectors and industries.

By their very nature, general-purpose technological revolutions are disruptive. Many benefits come not from adopting the technology but from adapting to it. In the UK, internet transactions account for more than a fifth of all retail sales, which is a 5-fold increase from just one-twentieth in 2008.

The Technology Economy

Given the fast-paced emergence of disruptive products and services, executives and entrepreneurs need to be able to detect the economic impact of these technological changes and respond with similar speed and foresight.

Researchers have found a link between technology innovation and national economic prosperity. As a result, many countries around the world are investing in digital infrastructure to jumpstart economies that have been weakened by the recent collapse due to the coronavirus pandemic.

Using Technology to Partake in the Economy

Faster broadband speeds have allowed people to take advantage of new digital tools like GIS, telemedicine, virtual reality, and video conferencing. These areas are all ways in which the youth can innovate and start businesses to improve productivity in the economy.

In the health sphere, the digital revolution has allowed physicians to share digital images with colleagues in other geographic locations.

Schools have been able to extend distance learning to under-served populations, and even to serve their regular students during the lockdown. Better technology and infrastructure in this area also enables personalized learning and real-time assessment.

Entrepreneurship in the Digital Economy

The transition of the economy towards the digital era is creating a type of entrepreneurship based on features that are greatly different from established game rules. the digital avenues available to small businesses today allow them to reach out to their customers to create an impact, innovate, and grow.

As the youth look to focus on new trends and develop proper business models to achieve scalability, it is important to jump on the digital bandwagon quickly to reap its benefits. It is also important to note that the initial growth period is often followed by a long period of stagnation. This stagnation is not due to a lack of opportunities but rather the inability of the entrepreneur to stabilize operations, an action that is essential to convert opportunities into profitable revenues.

Vision and Adaptability

Young entrepreneurs have youth and flexibility on their side. As important as it is to have a vision, the ability to explore avenues as they arise may allow for new, better ideas to be nurtured and brought to life. There is an endless number of bumps in the road to success.

Most importantly, being an entrepreneur in the age of a digital revolution requires more than just being a savvy businessperson. Above this, you need to understand not only the technology you are developing but the wider technology ecosystem. Being able to see where technologies will develop and provide opportunities in the future will allow for greater scalability and success.

Budgeting is the central nervous system of a business; however, it is not an easy exercise. If you are looking to help drive your business’s financial future in the right direction, budgeting correctly can make all the difference in the world.

A good budget can have a knock-on effect on all your business operations, so here are five tips to help build an effective business budget.

1. Understand What a Budget is

A budget is not meant to manage every penny spent. It is simply a guide to assist you in making better spending decisions and can be an eye-opening tool for areas that need improvement.

When creating a budget, mindset is everything. A negative attitude about budget diminishes your chances of creating a budget your company will be able to stick to. Instead of seeing it as a hurdle, consider a budget as a positive tool that will help guide your business in the right direction.

Some companies find it better to budget on an accrual basis while others like to focus on cash flow, so finding the right type for your industry is important.

2. Know Your Organization

A thorough understanding of the risks associated with your business and industry is imperative for effective budgeting. A business with seasonal trends will likely need quarterly budget breakdowns.

Being aware of any impending changes surrounding tax and regulations is also important. Compare your business to the industry standard using your CPA’s tools and resources.

3. Build the Right Team

A budget should never be created by one person. If certain groups of employees are going to be held accountable for the budget, then they should also have something to do with the creation of it. Usually a management task, sometimes other individuals can bring a fresh perspective to the budgeting table.

4. Be Realistic

A budget isn’t effective if it is designed toward a targeted number. Unrealistic and unattainable budgets are often scoffed at by employees.

Develop your budget according to past results and future projections. Analyse results from up to five years ago as a starting point. Once this is done, enter fixed and inevitable costs first. Then, accounts and line items that have fluctuated drastically over the past few years can be analysed according to what has caused the fluctuations and whether they can be better controlled.

5. Be Conservative

Some level of the unknown needs to be factored into a business budget. There is always an unexpected element to any project you undertake. Make sure you plan for contingencies and future years. Economic downturns are inevitable, and so a strong year should not only create a balanced budget but also a cushion for anticipated rainy days.

Budgeting requires the owner/manager to have an intimate knowledge of the company finances and a good understanding of seasonal changes in finances. A budget can work as a great incentive to stay afloat and in charge of controllable and uncontrollable expenses.

Companies facing crises such as a coronavirus or other environmental and financial shocks are often being run by managers working with a set of paradigms that no longer apply to the business’s current situation. This inability to acclimate to a changing business environment can spell disaster for a company.

There are several signs of a company in need of restructuring as a result of being in distress, including declining free cash flow, diminishing liquidity, deteriorating industry fundamentals, and disruption in unionized work. In the current COVID-19 pandemic, many businesses are looking to restructure and find new avenues to create profit.

However, crises are also important opportunities for adaptation. Businesses can utilize their strengths to capitalize on opportunities in the changing business environment, while also work on weaknesses to become more resilient to threats.

RESTRUCTURING IS A FORM OF CHANGE MANAGEMENT

Reorganizing a well-established company can be difficult. It often involves a lot of emotionally charged conversations and involves cross-examination from a variety of perspectives and stakeholders.

TOP TIPS FOR RESTRUCTURING:

1. COMMUNICATION – change is difficult and can leave an organization feeling uneasy. Ambiguity can lead to fear and uncertainty, and so during times of restructuring, effective communication is important. Take care of talking to staff and answering questions and make announcements to ensure everyone in the organization is on board with key decisions.
2. PLAN AHEAD – implementing change requires careful planning ahead of time. Taking consideration of not only the benefits of restructuring but also the potential impacts of core processes is vital. Establishing contingency plans, I also wise as unforeseen changes are likely.
3. MEET IN THE MIDDLE – Talk to various people at various levels of your business to get a varied look at how the business can be restructured. Often, a manager’s vision combined with employee ideas leads to the best solutions, because employees are often able to identify challenges that may be overlooked by upper management.
4. LOOK FOR NEW AVENUES – In the current pandemic, looking at how to repurpose your current strengths to work around restrictions and cater to current demand can be a viable method of restructuring. This type of expansion requires ingenuity, but businesses can use available assets in new ways to continue making money.
5. STRUCTURE FOR SUCCESS – The virtue of organizational management is to bring a business more successful. Create specific groups to deal with specific problems like process-based teams as well as product-based teams. The key is finding the sources of weakness and centering effort in addressing them.

Restructuring a business can be daunting. However, in times of crisis, a business must look at their internal strengths so that they can respond to environmental threats and opportunities effectively. This flexibility and willingness to restructure and repurpose can allow a company to not only survive but thrive during turbulent environmental changes.

Being able to take control of business decisions anytime anywhere from the cloud has never been more relevant during the COVID-19 pandemic. While the doors of many businesses remained closed during the lockdown, people around the world are finding innovative ways through technology to keep operations up and running. Using cloud computing, businesses can access software programs on the internet as a service, platform, or infrastructure – most importantly it allows for frequent and safe sharing or storing of data. Cloud-based business solutions can be accessed from any device with an internet connection from anywhere in the world – a cost-effective, flexible way to enhance collaborations and business outputs.

Highly Affordable 

The benefit of cloud services is the reduction of expensive hardware costs, as hardware needs are left to the vendor. New hardware can be big, expensive, and inconvenient for fast-growing companies. Cloud computing alleviates these challenges as it is possible to rapidly and efficiently access information.

Cloud technologies may also bring about a drastic reduction in labour and maintenance costs. Since the equipment is operated by vendors and stored off-site, there is little need for in-house IT workers. If servers or other equipment need repairs or updates, it is the vendor’s liability and does not cost your firm any time or money. Cloud computing can also increase the productivity of workers and increase output volumes, in addition to the IT labour savings. As cloud-based solutions are faster than traditional means. Cloud-based solutions can cut costs and increase productivity, by enhancing flexibility and collaborations.

Increased Flexibility

The other major benefits of cloud-based solutions are flexibility and enhanced mobility. Cloud-based technology allows you and your employees the ability to work from any location in the world with an internet connection. Thus, employees can complete their tasks at home during times when they are unable to make it into the office. With Cloud solutions, you can always monitor the business operations effectively, as it allows real-time access to different business operations, permitting you to make informed and impactful decisions to benefit your business.

Scalability 

Traditionally when planning for unexpected growth, a business would need to purchase and store additional servers and licenses – which may take years to make use of reserve resources. However, cloud-based technology makes scaling services easy, allowing you to get additional storage space or features whenever they are actually needed. Upgrading your package is all that is needed, which can be done in minutes with some additional cost.

Backup capabilities 

Traditional computing system require back up plans, especially for data storage. As a disaster could lead to permanent data loss if there was no planned backups. However, stored data is automatically saved and backed-up to cloud systems, meaning if something happens to data on your personal device it will still be available in the cloud. Cloud-based systems can ensure your data is secure and accessible at any time or place with an internet connection.

Data security

The first concern most individuals have in the cloud-based debate is data protection, however, the cloud is probably one of the safest ways to store your data. The ability to move sensitive information into and throughout the cloud is essential for businesses to function and collaborate efficiently, quickly, and freely. There is also no concern about physical files being damaged or lost with cloud-based systems, as all inputted information is backed up on a virtual system that can be accessed through easily designed search functions.

 To stay competitive a company must be able to respond quickly to changes in the market place. Cloud-based systems can provide many useful advantages due to its customisable and flexible nature, which can aid companies to be more agile and practical in the running of their day to day operations.

These are just a handful of reasons why small and medium-sized businesses are making the switch to cloud-based solutions. The cloud is affordable, scalable, and creates a better end-user experience, making every company an innovative competitor.

Remote work was once a concept reserved for a handful of professionals, often reserved for those with super-niche skills. Recently, many businesses have been accelerated into the virtual realm due to the COVID-19 pandemic and the resulting lockdown. This large portion of the professional community – now working from home – is steadily showing us that businesses can be run from virtually anywhere. Moreover, small business owners are seeing the benefits of operating virtually, such as eliminating commute times and saving on office rentals.

By turning your company into a ‘virtual business’, you can trim your costs, improve your flexibility and give your team the freedom to work remotely, but this transition does not just “happen.” Adjustments need to be made and you need all of the necessary tools to achieve virtual success. Here are some pointers:

Having the right tools

If you’re going to run a virtual business, you need all the same resources used at the office. You also need to be prepared to automate your business processes and invest in cloud-based software.

There are a variety of advanced cloud and software tools that can help you run an efficient business. Here are some examples of tools which will help you optimize your virtual business:

• File sharing and back-up: GoogleDrive or DropBox
• Voice and video comms: Zoom, Google Hangouts or Skype for Business
• Accounting and payroll: Sage Business Cloud or Xero
• Slack or Microsoft Teams for messaging to make communicating and sharing easier.

Prioritizing Communication

Communication is important because it keeps the team in tune with deadlines, schedules, challenges, and expectations. In addition, when working with clients remotely, it is vital to communicate as effectively as possible.

Learn how your clients communicate and try to use the communication methods they use to stay connected. In addition to email, use some of the many online live communication tools

Communication is necessary if you want to build relationships, so establishing open lines of communication across the board is a crucial aspect of a virtual business’ success.

Stick to the schedule

Flexibility is great, but to get the most out of your business, you need to have a defined schedule that separates your work time from personal time. Since you work remotely, you may decide you don’t want to be nine-to-five – it’s completely up to you. Regardless of the specifics, stick to it, and be productive in those eight hours.  Working by yourself in a non-office setting requires a great deal of self-discipline. Start your day routinely and end it routinely. Having a cutoff time is important to keep your work life from bleeding into your personal life.

Set your goals.

Everyone has very specific goals. We track against those instead of the number of hours worked. Here’s another little-known secret: When people work from home against goals, they work more and are more productive. Having your goals in mind helps keep your business on the right path. You need to know how you want your business to grow and how you want to achieve that growth.

Many analysts believe that virtual businesses will one day be the norm and that traditional brick-and-mortar enterprises will gradually fade in popularity. There are a lot of factors at play with this digital shift, but it mostly comes down to the desire of entrepreneurs wanting to take their business to a global market. After all, technology has made us more connected than ever before. It can be said that with the right tools and self-discipline, you can optimally run your business from virtually anywhere.