One of the biggest challenges for businesses is trying to engage employees, as research from PwC shows that the Great Resignation is far from over. As such, this needs to be a major priority for organisations who don’t want to risk employees going elsewhere. And this isn’t only a matter of retention: engaged staff also yield greater productivity, higher profitability and increased sales.
The need to drive engagement is no different in the finance function. A motivated finance team is critical to any business, as ultimately, they are responsible for ensuring revenue and financial stability.
In particular, an unengaged accounts receivable (AR) team, who handle invoices and ensures the company receives owed payments, could prove disastrous. Low engagement levels could result in invoices taking longer to process, inaccuracies creeping into forecasting, and ultimately less attention being paid to what is one of the core functions of the business. As a result, boosting engagement levels should a key strategy for any financial leader wanting to drive organisational success.
Below are five steps enterprises can take to engage their AR teams:
Step 1 – Improve communication
One thing that’s commonly overlooked is the importance of communication. If AR staff feel they cannot communicate effectively with management, then it’s likely they will feel undervalued and become demotivated. For instance, while many AR processes involve important but mundane tasks, such as data entry and chasing up payments, there are others that demand specialist skills. If AR teams aren’t confident enough to flag when they need extra training for complex tasks such as forecasting, or are overstretched and inundated with mundane tasks, engagement and performance will quickly suffer.
Conversely, employees that are given clear channels of communication, and see immediate reaction to their requests, will feel much more valued. Better communication will lead to more engaged staff who understand their role and value within the business. This in turn will lead to higher productivity across the entire organisation.
Step 2 – Recognise good performance
Praise is another great motivator. Research shows 69% of employees looking to quit their jobs would stay in their current position if they were recognised or rewarded more. Recognising good performance helps staff to feel valued and appreciated, feeding benefits from greater collaboration and productivity, to reinforced business goals and employee purpose.
For finance teams, this could be as simple as providing staff members with a weekly performance review – remembering that with feedback, “who” is just as important as “what”. Recognition should also come from the top, for example Chief Financial Officers (CFOs) calling out top performers on company calls or within internal newsletters. Companies could also offer (and recognise) incentives, for instance giving a voucher to the person who solved the most late payment cases.
Step 3 – Provide regular feedback
Encouraging a feedback culture is key to staff engagement. A feedback culture is a working environment where individuals feel safe, empowered and free to share and receive feedback. Robust HR processes, such as regular appraisals and feedback loops, are the crucial foundation. Regular feedback enables staff to learn from their mistakes, or to hear what they’re doing well, which will motivate them to perform better.
Finance managers should also apply this culture to themselves: asking whether employee concerns are being met, whether employees are getting enough feedback on their performance, and whether their staff feel empowered. For instance, are workloads manageable, and do staff have the right tools? Teams are five times more likely to report increased productivity if their organisation invests in regular employee feedback, and staff turnover will be 15 percent lower.
Step 4 – Adopt agile practices
Employee engagement can be driven by agile working practices, helping AR teams deliver work in small increments with the same quality. At the same time, agile practices can remove silos – encouraging greater collaboration across the wider finance team. After all, a team is far more likely to solve a challenge together than one person struggling on their own.
One example of an agile working practice is sprint planning, whereby there are daily meetings to provide updates and flag any issues. Sprint reviews are also great for providing the same feedback from the opposite direction – such as a certain customer account team flagging when there’s been an uptick in payment performance. Not only does agile working help make workloads more manageable. It encourages teams to work more effectively – with businesses using agile working practices reporting 60 percent growth in revenue and profit.
Step 5 – Embrace automation
Whilst all the above is great for improving employee engagement, there is one last step that will drastically improve AR teams’ lives. When AR is managed without automation, team members are faced with executing repetitive, monotonous tasks, such as tracking invoices, chasing customers, data entry and validating payments. Without some variety or the opportunity to take on more rewarding duties, this monotony can take its toll and drain employees’ motivation.
To reduce the impact of these repetitive tasks, finance leaders can adopt automation. Automation dramatically increases visibility into financial data, eliminating the need for time-intensive manual processes such as data entry and transfer. It can also be used to handle collections activity, meaning invoices and payment reminders are sent automatically, on a customised cadence. By handling these routine tasks, employees can spend their time more valuably, whether that means working with priority customer accounts or providing strategic insight to the business through financial reporting.
This elevates the AR team’s role and provides them with the opportunity to have a greater impact on their organisation’s success; a much more rewarding and motivating prospect than handling the traditional, manual tasks that are inherent in AR.
Engagement is foundational to financial success
Greater employee engagement unlocks a huge number of benefits: from reduced staff burnout and turnover when recruitment is a major challenge, to improved outcomes such as quicker invoice processing, more accurate income forecasting and greater profitability. No problem is solved overnight, but finance leaders can begin setting themselves up for success with these five steps.
Reporting to the head of ICA’s Global Strategic Projects Team, the Director of ICA’s Global Accounts Receivable Practice is the Subject Matter Expert (SME) for our Accounts Receivable business. This includes industry, competitive, buyer persona and vertical expertise in support of our go to market strategy and execution in the markets we serve.