In a rapidly changing corporate world, those within the financial industry are certainly facing more challenges today than they did even just a decade ago. Gone are the days of solely focusing on record keeping and other day-to-day transactional tasks. Now, a finance manager’s role has shifted to encompass additional responsibilities in-line with developing technology and compliance.
From a lack of human resources and the introduction of digitised tax to the challenges that comes with remote working; these are just some of the biggest challenges faced by today’s finance professionals. Let’s explore each of these challenges in greater depth below.
1. Small teams
At the start of 2021, there were 5.5 million small businesses in the UK containing just 0 to 49 employees. While this is something to be commended, it does present specific challenges to those in executive positions.
Finance managers, for example, find themselves working within smaller teams and wearing various hats to ensure objectives are met. This may include assisting finance team members with their day-to-day tasks, as well as performing their management role.
It also comes as no surprise that small businesses often lack a dedicated human resources manager. Therefore, tasks such as the hiring, administration, and training of financial staff may also fall to the finance manager.
2. Embracing new technology
With the digital transformation of businesses, financial managers are also facing a radical shift in how they perform their duties. An increasing focus on technology has seen financial workers move away from the traditional spreadsheet and turn to automation solutions including cloud-based services.
This rapid transformation to digitised methods was partly brought about by the UK Government with their Making Tax Digital initiative. As a result, finance professionals have had to adhere to the initiative’s vision for the end of the traditional tax return and a ‘transformed tax system’ by 2020.
3. Reporting and providing real-time data
Data is a game changer for all areas of business, particularly finance. According to a survey from Deloitte, 49% of respondents said data analytics helps them make better decisions, 16% say it better enables key strategic initiatives, and 10% say it helps them improve relationships with both customers and business partners.
Despite its advantages, the requirement to report and provide real-time data can still pose challenges for finance managers. Along with dealing with poor data quality or inaccuracies, finance managers must also grapple with slow data production and the time-consuming nature of manual data ingestion. Without these responsibilities, however, a finance manager is unable to support the wider business.
4. Communicating with other departments
A finance manager is not only limited to working with their fellow finance workers. As an executive position, they must also communicate and collaborate effectively with other departments within the company, as well as additional stakeholders.
In a typical office environment, fewer challenges exist with this responsibility. However, in the wake of the Covid-19 pandemic, companies are now dispersed, with employees working from home or across several different locations. Therefore, trials such as different time zones, poor internet connections, and relying on teleconferencing technology can hinder this communication.
5. Rules, regulations, and compliance
All industries are subject to rules, regulations, and compliance, but perhaps none more so than the financial industry. In a survey of 1,100 financial services executives, 88% of respondents said they are challenged in managing regulatory change. The need to balance compliance demands as well as profitability goals is presenting the most difficulty. In order to do this successfully, finance managers are having to work longer hours, as well as outsource tasks, or hire extra staff to manage the additional work required to keep on top of compliance.
Get in touch today to learn how our cloud-based expense management software can help your finance leaders overcome their top challenges.