Professional services have seen a tremendous boom in recent years, with the number of companies in this sector growing significantly over the last decade. Professional service organizations are characterized by providing expert advice or skills to clients rather than manufacturing products (e.g., marketing & advertising services).
One challenge facing these businesses today is how to stand out from the competition and attract talent. Professional service organizations have to focus on building their reputation, and often, this means becoming a household name in the industry of professional services they operate in.
Another challenge is managing finances; financial management has traditionally been complicated because each organization operates differently with its own financial needs, goals, and processes.
In today’s business environment, financial management is no longer a task that can be done on the side. Professional service organizations are starting to realize that Finance as a service (FaaS) is more than just an expense, it’s an investment. Professional services companies have been utilizing FaaS for years and they’ve seen improvements in their ROI, streamlined operations, and future prospects of the industry.
The role of CFOs in professional service companies has also evolved with technology, which allows them to work remotely as well as spend time on higher-level tasks instead of basic accounting duties such as budgeting for expenses like travel budgets or making sure invoices get paid on time.
Changing Responsibilities for CFOs
In the past, CFOs were responsible for financial reporting and shareholder communications. However, in recent years their responsibilities have expanded to great lengths due to changing management demands. Professional service organizations are looking for input from a CFO on how they should use their resources, better hire qualified employees, improve their customer experience, better manage their customers, and more.
The role of the CFO is changing as a result of technological advancements in recent years. For example, artificial intelligence can assist with forecasting, and automation can be used to make financial decisions. Professional service organizations must know how these technological advancements will affect their future, so they need a CFO who is aware of the latest developments in technology and wants to stay on top of them.
To succeed in their new roles and responsibilities, CFOs need to adapt and adopt new skills, such as integrating data and using analytics. To do this, they will need to embrace a company-wide digital transformation that will streamline operations, capture new data sources and improve their ROI.
By being a driving force behind digital transformation and success, CFOs will have access to all the data that is needed and knowledge of how to best use this data for successful decisions.
CFOs play a vital role between the company and its stakeholders. When you have a CFO who can balance financial objectives with customer-centricity, they can be hugely influential in the organization’s success.
By embracing the digital transformation, CFOs will be able to achieve the following:
- Technology like artificial intelligence and automation help financial professionals know what customers want.
- Make company policy to provide a safe space for every talent-scarce SME so they can let their talented people flourish.
- With current cloud technology and automation, a modern finance leader takes more direct action to help incorporate customer feedback. For example, they may listen to the different departments and synthesize that knowledge with the customers’ needs and expectations to provide a better experience.
Similarly, CFOs will need to use FaaS if they wish to excel in the coming years.
CFOs should also have a strong understanding of their company’s culture and what is important to them before they start strategizing on how best to improve ROI and when it comes time for financial reporting or budgeting.
What Is Finance as a Service?
Finance as a Service is an agile model that enables companies to outsource their finance function to financial services firms. Professional service organizations that are heavy on the technology side will often benefit most from FaaS. It allows them to focus more time and energy on what they do best: servicing clients while also minimizing expenses related to managing and maintaining their finance and accounting function.
Indeed, finance as a service has proven to be an effective model for the industry. It is predicted that this will remain true in the near future, thanks to technological innovations and new technologies such as artificial intelligence, machine learning, and automation.
Depending on the finance as a service provider, professional service organizations can also benefit from other FaaS services such as payroll, benefits administration, full-service bookkeeping, controller level compliance and reporting, financial planning and analysis, and strategic CFO support, among others.
In the past few years, it’s become clear that many professional service organizations are eagerly adopting finance as a service (FaaS) solutions. It allows them to focus more time and energy on what they do best: servicing clients while minimizing expenses.
The Benefits of FaaS for Professional Service Organizations
Professional service organizations are constantly seeking ways to streamline their operations. FaaS is one of the ways they can do so by providing them with visibility into where costs and savings opportunities exist across all departments in real-time.
Professional services firms, such as law offices or financial advisory companies, have historically relied on outside providers for many of their needs, such as accounting, tax preparation, and business financing. They can also leverage FaaS to build a finance department that provides the same services without outsourcing anything or spending additional money building their infrastructure.
One of the benefits of FaaS is increased efficiency for professional service companies because they can integrate many aspects of the organization into the system. Below are some of the most common FaaS benefits for the Professional Service sector.
Professional service companies are always looking for ways to reduce costs to stay competitive and increase their ROI. One of the best solutions is finance as a service, which helps with invoicing, budgeting, payments processing, – all from one central location that can be accessed by multiple offices or even remote employees.
Professional services providers can also use FaaS software to automate billing processes, so they don’t have to spend time doing them manually each month. The increased automation reduces errors and saves money on labor hours while increasing accuracy over time, leading directly to savings!
FaaS also has other cost-saving benefits: it includes expense management tools that help optimize travel expenses using expense management. Professional service providers also get access to analytics tools that help them analyze their data to improve performance and profit margins.
Enhanced Financial Visibility
FaaS makes it possible to increase the financial visibility of Professional Services organizations. With FaaS, Professional Service companies can now get a complete view of their operations in real-time from anywhere, anytime, on any device with internet access.
With this insight, they can make strategic decisions about where investments need to be made and what projects should be prioritized for growth while reducing unnecessary spending that may not lead towards profitability. Tighter control over expenses also means Professional Services organizations can enjoy improved margins without sacrificing quality or service levels.
The Finance as a Service model helps professional services organizations get ahead. Improved financial visibility will help companies by providing insight into areas such as:
- Giving a high-level overview of cash flow and current financial position.
- Tracking ongoing profitability and customer acquisition costs.
- Highlight performance gained to any potential investors.
- Detect errors and fraud faster.
- Finance as a service helps you better manage your investment capabilities to make the best financial decisions.
CEOs of Professional Service organizations often lack enough business visibility to make the best decisions. Better financial visibility is key in understanding and managing your organization’s progress better. As a result, they are less successful than companies with employees who offer support, such as Finance as a Service (FaaS).
As for scalability, the FaaS model is already a proven winner. Professional services companies need to easily scale their business as demand ebbs and flow on an annual basis. This not only applies in terms of managing headcount but also resources such as physical space or equipment.
Professional service organizations can cost-effectively manage their resources with finance as a service model. They pay for what they use rather than committing upfront capital expenditures resulting in wasted assets if usage patterns change later down the line.
In addition, there is no commitment to any particular vendor which offers additional flexibility when it comes time to make changes; instead, whether paying per transaction or by subscription fee-paying for what they use means that professional service organizations will always have the best deal.
Lastly, when it comes time to make changes, professional service organizations can quickly switch providers as they are not locked into any contract with a vendor, which also offers additional flexibility and cost savings for this type of company.
Professional service organizations save time and money while increasing their productivity, but there’s one more big benefit to FaaS: improved optimization.
We’re not talking about the apparent benefits like cost efficiency or a streamlined accounting process which have already been discussed in detail – we mean an increased understanding of what is happening with your business by way of data analytics and artificial intelligence optimizations.
Professional service firms need accurate information on how they perform against the competition, so if you invest in these new technologies, they will give you detailed insights into your operations. For example, consider AI algorithms that analyze potential customers across multiple fields and machine learning technology that offers predictive insights.
The CFO in a Professional Service Organization is no longer simply the Chief Financial Officer but rather an influencer across all aspects of the business. They help manage risks and growth opportunities and lead ongoing strategic initiatives that have a significant impact on your company’s bottom-line profitability.
Strategic CFO Support
FaaS service can also help CFOs by providing strategic assistance. Professional service companies will often find themselves facing a variety of operational challenges that need to be addressed for the company to succeed, as well as ongoing business needs which demand financial attention and time management.
FaaS offers an opportunity for professional service organizations by providing tactical and strategic assistance with everything from day-to-day tasks like managing budgets or forecasting revenues, all the way up through long-term planning such as designing new opportunities and building out more comprehensive strategies based on future projections.
Finance is no longer just about crunching numbers – it’s also about getting results! The role of a Chief Financial Officer has evolved; today, they are expected to manage finances and take on an advisory role within the organization.
FaaS offers Professional Service Organizations ways to achieve better ROI, improved operating efficiencies, and the opportunity for creative solutions.
Many Professional Services companies are already using FaaS successfully internally to improve their operations. Some of these include:
- Strategic Planning – helping an organization plan out its goals for the future.
- Business Forecasting – forecasting revenue based on historical data and projecting into the future.
- Budgeting and Cost Control – managing budget allocations across departments or divisions within a company as well as controlling expenses throughout each department’s operational life cycle.
It is hoped that professional service organizations will also use FaaS externally by leveraging this technology to help them with day-to-day tasks and improve the level of collaboration and communication with their clients.
Furthermore, FaaS will have an enormous impact on the role of CFOs in Professional Service organizations. It is hoped that these professionals will feel more empowered to take control over day-to-day operations while also focusing their time on strategic planning and business forecasting.
Professional Service Sector Trends
The future of the professional service sector will be, in large part, dictated by the proliferation of technology. The advent of cloud-based software, for example, is changing the way that work gets done and how professional service organizations are structured. Professional services firms increasingly implement business strategies that rely on flexible labor models to adapt to increasing demand for short-term projects with incomplete requirements.
Consequently, professional service providers need a solution that allows them to scale their operations quickly and use tools that will give them a competitive edge in the marketplace. Finance as a Service is one of the most flexible and efficient solutions available to companies in this complex, technology-driven environment.
A value-driven revenue model is also something that professional service organizations should consider. Professional service providers need to calculate their time in hours and the value of that hour as if they were a consulting firm. A value-driven revenue model will charge clients based on their own success and profits, which will not only increase their profits and help their clients see the benefits of using FaaS.
Professional services companies should establish best practices for collaborating with clients and using resources more efficiently, such as cloud computing and remote data storage. By doing this, these organizations would focus on what they do best: providing excellent customer service!
How Consero Can Help
With Consero’s Finance as a Service, businesses in the professional service sector can leverage their service offerings with a turnkey financial solution. Professional services firms can outsource their finance and accounting functions, freeing valuable time for more important business activities like client development or product innovation.
Consero’s Finance as a Service provides professional service organizations the ability to strategically outsource their finance and accounting departments, all in order to maintain a core finance team. This fresh approach to the finance department will provide financial experts who are experienced and knowledgeable enough to make your business a success.
Our services help bridge a gap between your company’s financial goals and numbers (often the cause of business failure). By increasing financial visibility, you can monitor performance and measure progress more accurately. Additionally, this will allow you to assess risk in all potential scenarios, meet challenges head-on, work to create new opportunities, and overcome obstacles to business growth.
Finance as a Service has also removed the need to buy software or hire and train new people. In the past, this has been done over and over again, adding to inefficiencies in both buying software and hiring for each new company. There’s a never-ending process to account payable that every company needs in order to thrive. Consero is equipped with sophisticated technology and top-of-the-line financial expertise, so you have access to a team of experts who can navigate these waters anytime throughout your growth.
Our mission is to provide the infrastructure, staff, and technology that lets professional service organizations achieve accurate information and easy-to-read reporting. This can take the form of implementing our solution quickly so that we are ahead of a client’s internal resources.
With less time wasted on tedious operational tasks, CEOs and CFOs can get more out of their workday. Finance as a Service (FaaS) collects data in automated and efficient ways with help from artificial intelligence so general business people can make sense of it all.
In addition to all this, our clients will receive access to SIMPL – our aggregation platform that combines transaction details, support documents, real-time information, and financial dashboards into one place. We live in an age where people want updates on the go via their smartphones, and we have developed a system that caters to this need.
For more information, contact us directly!