Bill.com Survey Results
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- Cloud-based financial tools are emerging as a solution for CFOs to save money, maximize efficiency and drive growth, but many CFOs remain unfamiliar with these tools. - A survey found that while CFOs know of the cloud in general, most are unaware of new tools designed for finance departments, so they continue relying on paper and Excel. - Early adopters of cloud-based financial systems report improved cash flow visibility and receivables/payables processes, indicating first-mover advantage.
Bill.com Survey Results
- 1. For Clarity, CFOs Look to the Cloud Bill.com survey shows early adopters are getting first-mover advantage as finance managers adopt the cloud “We’re a fast growing In today’s high-pressure economic cli- to provide insight into how CFOs are mate, CFOs and other financial manag- thinking about cloud-based financial company and the only ers are aggressively searching for ways systems, whether they plan to imple- to save money, maximize efficiency, ment the systems, and what they see way we’ve been able and drive growth. Increasingly, cloud- as the advantages and disadvantages achieve that is by lever- based financial tools are emerging as a of online tools for managing tasks like solution that can help them accomplish accounts payable, accounts receivable, aging cloud-based sys- their daily tasks more efficiently while and cash flow. improving their cash flow management tems like Bill.com. I can and visibility. Financial execs still foggy tell you if we didn’t Yet, while most CFOs are aware that about the cloud leverage that, we wouldn’t other departments are moving to While CFOs in general were familiar cloud-based solutions, early adopters with the cloud, most were not yet be able to grow as fast are just becoming aware that tools aware that new products were emerg- exist for the finance department, acc- ing in this space, created specifically to and efficiently as we have.” ording to a new research study by serve their needs. As a result, paper- Bill.com. As a result, many CFOs based manual processes and static David Ostrowe remain stuck in the past, continuing spreadsheets remain the standard President, O&M to rely on paper-based processes and Restaurant Group tools for financial executives, and Excel spreadsheets to do their work. managing cash flow continues to be an The survey, taken in August 2012, imprecise, time-consuming task. When includes responses from 355 CFOs and asked what system they currently use financial executives in a wide range of to predict future cash flow, 72.9% of industries. The study is one of the first respondents said they still use their old
- 2. Excel spreadsheets, 8.5% use an ERP Could misconceptions 33% of respondents said no and 37% system, and 8.3% said they just do the said they were unsure. Only 30% calculations in their head. The remain- slow the move to online thought a cloud-based system could ing 10.3% said they don’t use any tools systems? offer a better way. However, organiza- at all. (See Figure 1.) tions that have embraced cloud-based Why has it taken so long for CFOs to finance tools are realizing the tremen- consider moving to the cloud? One dous value. A separate study of 541 theory is that some recall intense U.S. finance executives by Dimensional technology projects from a decade Research found that 92% of organiza- ago – projects that were notorious for tions using cloud-based planning tools going over-budget, sucking up time in have seen improved results, demon- intense user-training sessions, and not strating the first-mover advantage integrating well with existing systems. already in place. As a result, some financial executives might dismiss technology initiatives Early adopters reap results, as too risky and time-consuming. In reaffirm that cash is king Figure 1. fact, when asked what they think are What System is Currently Used Early adopters who have switched to to Predict Cash Flow? the biggest challenges in moving to cloud-based financial systems told a cloud environment, 64.1% of survey Bill.com they have greatly improved respondents said integration with CFOs’ frustration with this status quo both their accounts receivable and existing systems, 54.7% said system was clearly expressed in the Bill.com accounts payable processes. Sav- and network security, and 43.6% said survey. When asked to name the top ing money and time are significant introducing a new process. three challenges faced by CFOs today, motivating factors for companies that respondents cited the inability to fore- There is a widespread misconception are considering a cloud-based system. cast results (51.1%) and manage cash that it can take from six months to a 65.2% of survey respondents said sav- flow (47.4%) as their most pressing year to implement any new technol- ing dollars and hours would lead them concerns. These numbers indicate that ogy, including cloud-based systems. to the cloud. financial executives could greatly ben- One CEO of a large franchise chain Indeed, knowing when customers will efit from tools that provide real-time told Bill.com that he originally calcu- pay is the number one problem faced visibility into the amount of money lated it would take months to get all by finance departments on a daily they’re paying out and taking in, at 25 of his locations up and running on a basis, according to the Bill.com study. any given moment. cloud-based financial system. When he Almost 59% of respondents cited it finally made the transition, it took him However, despite their general famil- as a top concern. Other high-level under 2 hours. iarity with the cloud, 16.5% of financial concerns, survey respondents said, are executives said that, as far as they In reality, cloud-based systems are easi- difficulty estimating cash flow (55.7%) know, cash flow management tools er to implement than other software and slow action by those employees and systems are nonexistent in the packages, in large part due to new who are tasked with approving invoices market. Only 22% said they know the technology and open APIs. Most cloud to be paid (46.3%). (See Figure 2.) tools exist but their company doesn’t applications are built from the ground use them. up with the goal of lowering the cost, time, and risk of integrating them with These results show cloud-based tools, existing on-premise and on-demand especially those for cash flow manage- applications. This means companies ment, are still emerging in the market can implement cloud systems in record place and that defining this new space time and users can reap the benefits and educating the market will be with minimal training. critical work for companies leading in this new cloud-based financial pay- The more likely factor in CFOs’ ments space. For early adopting CFOs, responses is not misgivings from the Figure 2. deploying tools that are on the brink of past, but simply a lack of education What Are the Top 3 Problems Faced by changing the financial industry will give around the space, a space that has Your Finance Department? them a competitive advantage as they only started to take shape in the past leapfrog past other companies, due to two years. When asked if they believe their increased efficiency, effectiveness, it’s possible to eliminate the hassle of and cost-savings. paying bills with a cloud-based system,
- 3. This last number comes as no surprise, However, by using the cloud, compa- Another incentive for moving to the given the inefficient workflows and ap- nies could reduce the cost of sending cloud is the chance to reduce the proval processes that hobble most or- invoices, while collecting receivables flow of paper bills and transition to a ganizations. Financial executives have 2 to 3 times faster. In terms of hard paperless work environment. The vast long complained about paper-based numbers, a small company sending an majority of survey respondents (85.5%) invoices and expense reports that take average of 100 invoices a month would said reducing paper was either very weeks or months to be approved, cut their expenses from $2200 to $750 important or somewhat important because people put them aside, forget per month by using the cloud, accord- to them. Only 14.5% said it was not about them, or file them under a pile ing to separate research conducted important at all. of other papers. As a result, bills get by Bill.com. paid too late and cash flow forecasts Similarly, financial executives are Cloud opens new horizons grow ever more unpredictable. discovering that, by putting their AP There is nothing more important to The cloud can alleviate many of these process in the cloud, they can cut the CFOs than control—control over cash problems, say CFOs who have adopt- work by more than half and slash the flow, payables, and receivables. At a ed online invoicing and billing systems. cost by 50% to over 70%, a saving that moment’s notice, they need to know For instance, online finance services amounts to tens of thousands of dol- what the business is doing and where enable them to better track bills and lars for many organizations. In fact, a it’s going. They need intelligent finan- monitor the approval process. That’s company with an average of 100 bills a cial systems that can accurately predict because these payables tools eliminate month that uses a cloud-based system what will happen and when—systems the inefficiencies of manual processing. can reduce costs from $3800 to $309 a that give them deeper insight to their Instead, invoices to be paid are auto- month, according to industry research. cash flow and help them discern loom- matically routed to the right person for ing shortages before they happen. approval and prioritized for attention. Financial executives who have adopted In fact, when asked the one piece online systems also value the ability of advice they’d offer as an industry On the receivables side, finance pro- to approve bills remotely, wherever expert, 31.9% of survey respondents fessionals who use cloud-based tools they happen to be. One CFO noted recommended implementing business said on average they get paid faster that a cloud-based system unchained controls, while 26.8% said automating than they did using traditional paper him from the office and allowed him to to avoid human error. systems. In addition, when asked how approve an important invoice from his much it costs their Accounts Receiv- mobile phone, while watching his child As cloud-based financial tools gain able organization to process and send compete in a local swim meet. wider attention, CFOs will increasingly an invoice, 38.7% of respondents said turn to these solutions to achieve bet- under $5 and 32.2% said $5 to $10. Another priority that was uncovered ter control, efficiency, and ROI. In fact, the majority of respondents in the survey is that CFOs are looking For early adopters, deploying cloud- are likely underestimating the cost to implement systems that can help based tools will result in a significant because they’re not fully factoring in their business grow. Some 43% of advantage in an increasingly competi- the price of labor, materials, and other respondents said scalability was one of tive marketplace, which will be driven inputs. According to industry stan- the factors that would influence them by more pioneering cloud-based solu- dards, the average cost of processing to adopt cloud-based services. Only tions as the cloud business payment and sending an invoice is actually over 24.8% said scalability was not a factor, space matures. $22. (See Figure 3.) while 32.2% said they were unsure. Figure 3. How much does it cost your organization to pro- cess and send an invoice (including labor costs)? 3200 Ash Street Palo Alto, CA 94306 Main 650.353.3301 | Fax 650.644.0293 | www.Bill.com