As we enter 2025, businesses are navigating a dynamic environment filled with both uncertainty and opportunity. In such a climate, robust financial management isn’t just a nice-to-have—it’s a critical component of sustainable growth. Whether your goal is to weather potential economic volatility or to scale your operations, the strength of your financial processes will play a pivotal role in determining your success.
Below I have set out my six key areas businesses should focus on to ensure their financial management is fit for 2025 and beyond.
1. Financial Reporting: From Numbers to Insightful Storytelling
Accurate and timely reporting is the backbone of financial management. However, it’s not just about producing reports; it’s about ensuring those reports provide actionable insights.
- Timeliness and accuracy: Businesses should aim to close their monthly reporting cycle as quickly and efficiently as possible while ensuring accuracy, avoiding reactive and poor decision-making.
- Insightful dashboards: Customised dashboards with key performance indicators (KPIs) relevant to your business will enable your leadership team to make swift, informed decisions.
- Variance analysis: Identifying variances to budget and forecasts early allows you to review, understand and address underlying issues before they become significant problems.
2. Cash Flow: The Lifeline of Your Business
Cash flow management has always been critical, but in today’s fast-moving environment, it’s more important than ever.
- Dynamic forecasting: Move beyond static, long-term forecasts and adopt a dynamic 13-week to 12 month rolling cash flow model. This allows you to reflect real-time changes in operations and market conditions.
- Proactive management: Implement strong processes for monitoring debtor days, credit control, and payment terms.
- Building a cash buffer: Given the unpredictability of external factors, maintaining a cash buffer can help businesses navigate unforeseen challenges without disrupting operations.
3. Team Structure: Building a Finance Function for Growth
Your finance team plays a crucial role in enabling both day-to-day operations and long-term strategy. Ensuring you have the right structure in place is key.
- Skill set assessment: Does your current team have the right blend of operational and strategic expertise? If your business is growing or evolving, your finance function needs to scale accordingly.
- Outsourced support: For many businesses, outsourcing all or part of the finance function can provide cost-effective access to high-level expertise without the need for a full-time hire.
- Role clarity: Clearly defined roles and responsibilities within the finance team can drive efficiency and prevent bottlenecks in decision-making processes.
4. Systems & Processes: Leveraging Technology for Efficiency
Outdated or inefficient financial processes and systems can limit a business’s ability to grow and adapt.
- Systems review: Conduct a thorough review of your current finance systems. Are they enabling efficiency, or are they a source of frustration?
- Automation: Invest in automation to reduce manual tasks and improve accuracy allowing your team focus on value-added activities.
- Internal controls: Ensure you have processes in place to safeguard assets, mitigate fraud risk, and ensure compliance with regulations.
5. Marketing & Growth Strategy: Aligning Spend with Financial Goals
A strong financial strategy must be closely aligned with your marketing and growth plans.
- Balanced budget allocation: Ensure your marketing budget is balanced between short-term, high-ROI campaigns and longer-term brand-building initiatives.
- Performance tracking: Set clear goals for marketing spend and track performance against them.
- Cross-functional collaboration: Finance shouldn’t operate in isolation. Encourage collaboration between finance, marketing, and sales to ensure everyone is aligned toward the same growth objectives.
6. Strategic Guidance: Finance as a Strategic Partner
In today’s complex business environment, finance should be more than just a support function—it should be a strategic partner.
- Finance leadership: Ensure your finance leadership, whether in-house or outsourced, is involved in key strategic discussions. Their insights can help guide decisions on everything from new investments to operational improvements.
- Data-driven strategy: Use financial data as the foundation for your strategic planning. Whether you’re exploring a new market, launching a product, or optimizing costs, robust financial analysis can significantly reduce risk.
- Regular reviews: A strategy isn’t static. Regularly revisit your business strategy to ensure it remains relevant and responsive to market changes.
By focusing on robust reporting, dynamic cash flow management, building the right team, investing in efficient systems, aligning marketing spend with financial goals, and embedding finance in strategic decision-making, you can position your business to thrive in a rapidly changing world.