The vital role of digital transformation in businesses became very clear over the past two years. Those without a robustly digital back-office felt the wrath of pandemic-related disruption, sadly forcing many to close their doors. Propelled by the pandemic, digital transformation is a top priority of small business owners and executives aiming to future-proof their businesses. What can a digital transformation do for your back office and business as a whole?
Modernize old systems
Generational companies have many benefits over new start-ups, but they often share a common struggle: being stuck in old ways of doing things, with outdated technologies and processes. While these practices may not be broken and continue to serve the business, there is substantial room for opportunity. Modernizing generational systems and old technology, or lack thereof, can increase efficiency and capabilities that will add value both for the back office and the customer experience.
Modernizing bookkeeping and the overall back office with the adoption of cloud-based accounting can bring the company up to speed and offers endless benefits. Processes such as payroll, expensing, invoicing, inventory management, and payment processing are just a few of the many processes that can be accomplished with cloud accounting. Many elements of the above processes can become automated, saving the business owner and employees valuable time.
Analyze customer trends
Digital transformation is much more than your business residing on the computer. Digital transformation gives you insights into your business that would not be available on a pad of paper, allowing you to make well-informed business decisions. Cloud-accounting apps, such as Xero, provide analytics about your overall finances, including customers. Without customers or clients, your company would exist. So why not utilize a cloud technology that provides insights, allowing you to understand your clients? Cloud-accounting apps can give insights into:
- Past purchases
- Spending history and frequency
- Overdue invoices
By understanding customer behavior, you have the opportunity to leverage those insights in many areas of the business.
Digital transformation, with the use of cloud-accounting apps, is a powerful tool for maximizing efficiency. Repetitive, mundane tasks can oftentimes be automated, or at the very least, simplified. Double entry is eliminated with seamless integrations of thousands of cloud-based accounting apps. Collaboration is made easy with real-time collaboration from within the app regardless of where you, your staff, or contractors are geographically located. Data and file sharing is quick, safe, and secure without the need to email documents and data back and forth.
Carry on with business from anywhere
If we have learned anything from the pandemic, it is the need to be able to carry on with business from anywhere. Those businesses that had already undergone a digital transformation, or that were quick to transform, were able to maintain business without the need to have their staff in the office. Cloud accounting apps were, and continue to be, a critical factor for business continuity.
Be prepared for tax season
Tax season can be a stressful time for any business owner. There are many opportunities for deductions and credits that can reduce the business’s taxable income, but without preparation and proper documentation, these valuable credits and deductions can slip through the cracks. If you don’t have a good system for tracking everything, you risk a bigger tax burden, not to mention the endless hours organizing at year-end.
Not sure which expenses are deductible or the best way to track them? Download our free comprehensive guide of the top small business tax deductions. This essential guide provides examples, tips, and strategies that will give you a better understanding of valuable deductions.
A digital, cloud-based back office can help business owners with tax preparation throughout the year and come tax season. Need to pay quarterly estimates? Staying up to date on income and expenses will help smooth the process of calculating those estimates. Apps such as Gusto can automate the payroll process, ensuring you never miss payroll taxes. With all income, expenses, and documents in one, secure, organized space, planning business moves with tax advantages becomes a streamlined part of the year.
With the help of cloud-based accounting, the business books are kept up-to-date, which is an incredible time-saving tool when sending information to your tax preparer. The benefits go far beyond tax season. A well-kept digital book helps you and your financial expert with tax planning and projections.
Although the majority of the pandemic disruptions are behind us, we never know when another global crisis could arise. Digital transformation is the key to surviving another global, industry, or business-specific crisis. If your business has yet to adopt cloud accounting, there’s no better time than the present. Our team of cloud-accounting experts can sit down with you, virtually or in office, to discuss the many benefits of cloud accounting and how it could improve your unique business. Send us a message to schedule a meeting.