While implementing new solutions requires different ways of working, the benefits to the organisation will be significant, including streamlined project control, improvements to the sales pipeline and the provision of better reporting tools
Colchester, UK (PRWeb UK) June 30, 2010
A staggering 88% of mid-market organisations highlighted better measurement and reporting as key to cutting wholly avoidable losses and missed opportunities within their businesses. This is according to a recent survey* of customers, undertaken by Access, the mid-market consulting, software and solutions provider.
Whilst these “profit leaks” within businesses across the UK are proving a huge cause for concern - and many companies currently do not have the visibility to identify inefficiencies within their end-to-end operations - there is wide recognition that significant savings can be made by plugging these leaks.
How big is the problem?
The survey provides insight into where profits are being eroded and how organisations can start to monitor, manage and reduce losses. Overall, 88% of respondents surveyed acknowledged that they have profit leaks within their organisation. Of the organisations experiencing profit leaks, the highest grouping of respondents, 36%, believe that between 0-10% of profits are lost, 27% of respondents believe that 11-20% of profits are lost and 25% said they did not know the percentage of profits lost. While some might not believe this represents a significant amount, there are very few other levers that a business can pull to generate this level of profit, when all other obvious opportunities to make savings have been taken.
Chris Bayne, managing director for the Solutions Division of Access, commented, “It’s clear that profit leakage is an issue within UK businesses and trading your way out of trouble is not an option. During this period of continued economic instability, profit losses need to be dealt with head-on if businesses want to survive and prosper. The great news is that many of these losses are wholly avoidable.”
A considerable 32% of companies surveyed did not know where profits were being lost, therefore making it impossible to identify where to begin tackling the issue. Of the 68% of respondents that knew where their organisations were leaking profits, 72% of respondents believed that operations leaked the most profits, followed by sales and marketing (56%) and finance (31%). Looking at the results more specifically, lost sales opportunities, poor project cost management and low staff utilisation were all among the top areas of profit losses cited.
What can be done?
Respondents strongly felt that having the right information to hand would have the greatest impact on reducing profit leaks, with 51% pinpointing reporting as the main focus of review and improvement. Indeed, when compared to what measures the respondents ‘could’ put in place to prevent profit leaks, 63% of all respondents said that better reporting tools, alongside greater visibility across the organisation (56%) were the top two measures. Those that did not know where the profit leaks were in the organisation were mindful of the fact that reporting and accessibility of information are essential to stemming losses.
“This shows just how critical reporting and visibility of data is to an organisation. Having access to accurate and timely information provides a better understanding of where opportunities are being lost. And if you have transparent reporting on staff utilisation, sales procedures, billing/cashflow, project profitability or stock availability, then you have a benchmark to make improvements. After all, you can’t manage what you can’t measure.”
Chris continued, “It is no secret that every organisation has profit leaks, but identifying where these are occurring is a huge challenge. The most common problem for companies is the lack of timely data on which to analyse operational effectiveness due to disjointed systems and mismatched KPI’s across the business. Taking the time to analyse the flow of transactions through an organisation - and the key metrics which should be in place at each stage - can help to build a case for change. The result is more available profit that can be invested back into the organisation and its workforce.
Business-wide solutions and technologies play a significant role in addressing the issues and creating workflows that help stem the tide of profit loss through effective savings measures, as well as highlighting additional profit opportunities. Providing increased transparency, employees across the business are also empowered to make more efficient use of resource, ranging from their individual time to cost control.
“While implementing new solutions requires different ways of working, the benefits to the organisation will be significant, including streamlined project control, improvements to the sales pipeline and the provision of better reporting tools,” continued Chris. “Having access to realtime information and analysis can also help to spot interesting trends, which could be the source of additional opportunities. Not only will this have a positive impact on the bottom line, but organisations also will be able to provide a more efficient and valuable service to customers. Through integrated, business-wide solutions organisations can be assured the improved visibility will successfully reduce losses and increase profits, providing the stability they need to survive in any economic climate and enjoy a prosperous future.”
You can view the full profit leaks whitepaper on the Access website: http://www.theaccessgroup.com/downloads/info-guides/profitleaks.aspx
- Sample: Access hosted a series of customer summit events throughout the UK in the Spring of 2010. During that time, 169 mid-market organisations were surveyed to gain valuable insight into the profit leaks they experienced.
- Access is a consulting, software and solutions provider, serving the mid-market
- The consulting services are backed by more than 65 accredited consultants, providing business software expertise. They operate nationally out of 10 offices in the UK and Ireland
- The software portfolio provides solutions to meet the needs of the whole organisation, helping to reduce complexity and increase efficiencies at every level. In addition to accounting and finance, Access also offers manufacturing software, professional services automation, and accounting for carbon emissions reporting. Other software solutions include distribution and warehousing, HR and payroll, document management, service and contract management and CRM and sales automation
Accreditations and memberships:
- Microsoft Gold Certified Partner
- Institute of Chartered Accountants in England and Wales (ICAEW)
- Business Application Software Developers Association (BASDA)
- HM Revenue & Customs: Payroll Standards Scheme
- Green IT Awards 2010 for 'Environmental Accounting Software of the Year'
- SIFT Media Software Satisfaction Awards 2009 for ‘Green Software Provider of the Year’
- Manufacturer of the Year Awards 2009 for 'IT in Manufacturing', won by customer Renthal for its use of the Access Supply Chain solution
- Construction Computing Awards 2009, 'Construction Accounting Software of the Year' and shortlisted for 'Environmental Product of the Year'
- Accountancy Age Award 2008 and 2009 for the best 'Mid-tier Software Package'
- SIFT Media Software Satisfaction Award 2008, for the second year running, in the category of best 'Mid-Range Software'
Head of Group PR
Access UK Ltd
T: +44 (0) 1206 322575 / 07833 936311
F: +44 (0) 1206 322956
Danielle Cook/Robyn Bemment
T: +44 (0) 1628 628080