November 8, 2019
4 Smart Ways CFOs & Finance Execs Can Tackle Year-End
The end of the year is always a busy time that is oftentimes rife with competing priorities and overworked employees. There are projects to wrap up, key organizational milestones to tackle before the holidays hit, new regulatory requirements to meet— and of course, business budgets to handle. There are, however, some smart ways you can close out your year successfully and set your organization up for success in the new year.
Do you take your year-end preparation in stride, or do you dread it? The following are some key steps that lead to a smooth and painless year-end. Let’s take a closer look.
Confirm the major revenue assumptions in your FY2020 budget
Business risk related to revenue concentration among major clients can be lurking below the surface during the budgeting phase. Unfortunately, it usually comes in the form of unchallenged assumptions from prior budgets and analysis. Take the opportunity to shore up any of those weaknesses by verifying directly with your account managers (or other internal owners), if there are any risks associated with each client and their potential to churn.
Catching these risks before your budget process wraps up will give the organization the opportunity to address these potential budget bombs, using measures that prevent major re-work, such as applying a broad hedge to your revenue and/or your operating income.
Avoid financial surprises during year-end review, by double-checking key assumptions in your budget where you have material revenue concentration.
Re-examine pricing with vendors & service providers
Cut the bloating and get lean by renewing the effort to evaluate your major contracts with vendors, suppliers and service providers. Follow-up on your key action items related to your major contracts, and make sure those are being renewed or renegotiated. Additionally, if the contract is being cancelled, make sure it is being replaced with a new vendor that is priced right.
Moreover, legacy service providers and software programs always seem to slip in under-the-radar and into the budget. Some of these underutilized programs can be expensive to maintain. Therefore, cutting them can result in real savings. Putting together a running list of programs, with their license count, can help identify these expense leaches.
Set your reporting and forecasting functions up for success
Most organizations have software programs and ERP systems that are severely underutilized, and have capabilities that are strangely hidden out in the open. Take advantage of the slower business cycle to explore additional functionality of your current ERP and forecasting system, to determine if there are more efficient ways for your team to operate. Online research from web searches and forums, as well as conversations with subject matter experts and consultants, can uncover substantial efficiencies that were previously unknown.
Use a consistent message and tone in your communication
There is no better tip to orient the direction of your organization, than consistent messaging and respectful tone in communication to all employees. Implementing any of the above tips will be made more difficult if the overall message changes or is inconsistent. This will cause confusion between the employees in charge of implementing such changes, and inevitably lead to the unraveling of any efforts.
At its core, implementation of a new product, policy and/or procedure is a messaging campaign that should come in two forms:
- First, have readily available documents that employees can see, with an overall objective, as well as a list of benefits that can be explained in doing the new implementation.
- Secondly, ensure that common talking points are used by the leaders who are implementing the change. This will help to prevent any messaging inconsistencies from occurring.
HOW WE CAN HELP
How long is your year-end to-do list? Need an extra set of hands or additional coverage over the holidays to get more open items across the finish line? Here at Bridgepoint Consulting we have a team of finance, accounting and technology experts ready to help you tackle your projects and initiatives from start to finish. Let us partner with your finance team and bring our collective knowledge and expertise to ensure you successfully achieve your company’s objectives and goals. Check out our service offerings and let us help ease your year-end today!
How CFOs Can Set the Stage for Success
Are Traditional Budgeting Models Still Relevant?
5 Signs Your Financial Planning Software Needs a Refresh