19DECEMBER 2022CFO TECH OUTLOOKmanage real-time information to support customers and make informed business decisions, the leaders of these companies fly blind and make decisions disconnected from reality. What are foundational investments that must take place to enable sustainable growth?For successful businesses with long futures, it is critical to invest time and resources to carefully choose effective Enterprise Resource Planning (ERP) along with scalable transactional and analytical systems. Given the cost and complexity of the implementation of any system, a forward-looking risk management approach keeps into consideration a 5-to-10-year growth strategic plan to avoid wasted resources and ensure sustainable growth. Effective research and expert advise to identify the right systems considering business needs just makes sense because of the high-cost and inherent implementation risks.One of the common mistakes experienced by small businesses is to customize systems based on the personal preferences of certain individuals, who may or may not remain in the business for an extended period. A governance structure that requires the documentation and expert review of system customizations pays off dividends because it reduces the overall maintenance and upgrade costs over the life of the system. Without any doubt, investing in internal expertise and proper training for all employees should not be negotiable when a company devotes significant resources to foundational systems.However, what are the goals of any system and process? First, the existence of a business depends on effective and efficient customer service. Therefore, forward-looking risk managers view the foundational systems and processes that allow consistent delivery of goods and services to customers in line with their commitments as must-have capabilities that require proactive investment.Secondly,knowledge is power. Reliable master data and timely analytics on the performance of the business, related forecasts, along with visibility to risks and opportunities are essential to make asserted business decisions. Finally, especially in the current labor market environment, if a company does not enable each of its employees to be productive and feel good about his/her contributions to the success of the business, the likelihood of employee retention is low. An experienced and well-trained workforce provides a significant competitive advantage that leads to customer satisfaction at a lower cost, which in turn creates sustainable profitable growth. In conclusion, forward-looking risk management is essential to proactively invest in foundational capabilities that maximize the value of high-growth emerging businesses. One of the common mistakesexperienced by small businessesis to customize systems based onthe personal preferences of certainindividuals, who may or may notremain in the business for an extended period
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