The C-Suite Concierge
FOCUSED ON C-SUITE PRIORITIES
Covid-19 has brought challenges to supply chain management and vendor relations beyond the typical price and on time delivery metrics. Supply chain delivery disruptions and Covid-19 shut down dynamics have affected not only production schedules and customer deliveries, but also aspects of vendor invoicing and accounts payable processing.
The impact of Covid-19 has also resulted in a search for simpler, faster, and more efficient ways to handle day to day overhead processes and still meet customer order requirements. Through the use of automated business logic processes, technology systems can free up labor for higher value projects without requiring an increase in payroll numbers.
When efficiency and cost reduction solutions are promised by technology system vendors, it falls to C-Suite level management to evaluate the suitability of any proposal that promises not only significant operational efficiencies but potentially a 20-30% reduction of specific AP expenses. Depending on annual expense figures, that percentage of expense reduction could result in a SIX or SEVEN FIGURE CASH FLOW REALLOCATION OPPORTUNITY.
The next section of this web page highlights common roadblocks which keep desired cash flow and labor efficiency initiatives on hold or perhaps postponed until a subsequent budget year.
As noted by Lifesize, a global provider of cloud based conferencing systems, "the single most compelling reason to install any technology is to be more productive." In terms of productivity, technology systems can
apply cost control analysis to data intensive processes and reduce human error by automating manual labor activities.
The chart above summarizes the results of a survey of companies who chose not to implement a marketing system that could increase both their sales volume as well as new customer acquisitions. The reasons given for not adopting the new system can be combined into THREE CATEGORIES:
1. Lack of financial resources
2. Lack of technology resources, and
3. Resistance to change by management and the organizational structure
A clear eyed analysis of these potential roadblocks needs to be done as part of the due diligence process for evaluating any system or service that can increase cash flow and generate new income sources.
Hitting the Target
Instead of being reasons why a system CANNOT be implemented, FINANCIAL AND TECHNOLOGY issues can actually be reasons FOR system implementation. When an analysis of AP expenses is made, cash flow reallocation figures can verify "upfront" that a perceived FINANCIAL IMPEDIMENT can be eliminated once specialized technology systems are put in place.
When it comes to the issue of "COST", there is more on the table than just an invoice. A new technology system always brings some level of daily work disruption as users adjust to changes from "the way we've always done it". However, unlike the level of disruption that accompanies major ERP system changes, the integration of specialized niche focused systems does not affect all levels of the organization. Nevertheless, the "cost-benefit ratio" of any system implementation should clearly be addressed as part of the analysis process.
With regard to the perceived TECHNOLOGY IMPEDIMENT reason, if the technology system supplier handles the set-up and/or integration process, then the perceived technology impediment to adopting the system can likely be eliminated or at least greatly minimized.
The third category of survey results is a MINDSET RESISTANCE TO CHANGE. In a January 20, 2021, Wall Street Journal article, Dirk Hilgenberg, VW Software CEO, notes that the biggest challenge facing their software development program isn't the technology. "It is the mind set of the people - their reluctance to embrace radical change until circumstances force them to."
That mindset resistance to change was the survey's highest impediment to system change reveals the critical importance of employing a genuine collaboration process for evaluating systems and services that can significantly increase both cash flow and operating efficiencies.
Which of the three perceived "impediment" categories, if any, are blocking the implementation of a solution to a problem that you need to deal with at this time?
If a solution being used by other companies to solve that same problem exists, how soon would you want to know about it? In other words, how many opportunities may have passed you by simply because you weren't aware of them?
Would it make sense to have an initial conversation focused on addressing your top priorities and identifying a solution to help you achieve them? If so, use the form below to let me know what makes sense to you.