Danger ahead as upturn looms

Over the past two years IT companies have seen record growth levels reversed almost overnight. There has been a dramatic reduction in personnel, particularly in administrative functions, as cost cutting has topped the agenda.

However, the mood is improving. There is a feeling that the worst of the recession is over and that an upturn is on the way. But, as every business that survived last time around can attest, coming out of recession is a dangerous business.

How do you service new, demanding customers without increasing administration costs and leaving the business vulnerable again to the vagaries of economic development?

In such a climate it is difficult to justify reloading your business with staff to manually write cheques, print remittance advices and stuff envelopes. Recoveries are not always sustained; in the event of another downturn, businesses could face more morale damaging redundancies.

Instead, they should use technology to eliminate administration processes. One of the easiest methods of taking steps towards these goals is to make payments or collections electronically using the Banks Automated Clearing System, or Bacs.

This takes the pressure off administrative staff and delivers immediate financial benefits to the business. Not only can staff handle hugely increased volumes of work, but they have more time to address the more challenging aspects of their role.

The involvement of staff in business critical activities, such as credit control and cash flow management, can reduce the incidence of sick days and staff turnover, resulting in further savings.

Companies should also be looking to e-enable the dispatch of financial documents via fax, email, electronic data interchange or the internet, depending on the preference of the receiving organisation.

Automation of these processes can save up to 90 per cent of costs through the elimination of bank charges, stationery, printing and postage costs alone, and implementation typically takes just one day.

Business confidence may be on the up but recruitment is not the answer. At a time when firms need the resources to take advantage of an upturn without increasing costs and putting themselves at risk, there is a strong argument for the automation of administrative processes.

Adrian Stafford-Jones is managing director of Albany Software.

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