According to new research from Coupa Software - a leader in Business Spend Management (BSM) - today’s economic volatility, coupled with inadequate financial systems and processes are holding organisations back from growing.
Financial processes are not robust enough
In Coupa Software’s ebook titled ‘IPO Readiness Checklist’, 72% of high-growth organisations recognise that their financial processes are not robust or scalable enough to support their growth plans.
Coupled with concerns regarding the rising interest rates (32%), supply chain shortages (30%), stock market volatility (30%), and Inflation (29%), 78% of organisations are curbing growth plans and delaying their IPOs.
“High-growth and pre-IPO phases are major stress tests for any company. An uncertain market environment like we’re seeing now doesn’t help either. Finance teams can be the anchor in these storms, providing real-time transparency to facilitate management decisions, as well as developing processes and implementing technology to support the way forward,” commented Tony Tiscornia, chief financial officer at Coupa Software.
The time is now for digitalisation
Elsewhere in the research, Coupa Software identified that manual processes and siloed data are holding companies back when it comes to having a clear picture of their cash position and audit compliance in order to drive high growth.
Key challenges include:
- Manual processes - 60% in procurement; 56% in supplier management; 47% in invoicing; and 40% in payments.
- Accurately identifying cash - Only 38% of organisations can accurately identify company cash on hand; 75% have to log into multiple systems to do so; and 42% report that it could take several days to do so.
- Lack of available data - 62% of organisations are not confident that they can produce auditable financial information for at least the last two to three years. 60% couldn’t confidently produce auditable reports for markets on a quarterly basis.
The report concludes with the ways in which organisations are seeking to improve their processes to support their growth and readiness. Such improvements include:
- 85% want to improve risk management processes and controls
- 75% continue to build their team of experts
- 67% want to improve financial controls to protect future stockholders and prevent embezzlement
“Regardless of a company’s growth plans, whether it’s to scale for an IPO, M&A, or to raise venture capital, a comprehensive approach to business spend management will provide a single source of truth that empowers finance teams with full financial visibility and control. For those companies that have delayed an IPO, now is the opportune time to digitise back-office functions. This will not only instil confidence in financial operations and compliance in advance of being ready to list but also ease the burden of increased scrutiny once they become public,” concluded Tiscornia.
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