(This article was last updated on 17 October 2024.)
These days, finance teams are facing more challenges than ever—even compared to just ten years ago.
Gone are the days when running an efficient finance department meant, having to solely focusing on record keeping and other day-to-day transactional tasks.
Now, as a finance manager, your role has expanded to include new responsibilities thanks to evolving technology and financial compliance requirements.
From dealing with limited human resources and navigating digitised tax systems to overcoming the hurdles of remote work—these are just some of the biggest challenges you're up against today.
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What Challenges Are Finance Managers Facing in 2024?
There are many challenges of being a finance manager today, but the top five in 2024 are:
Managing small teams
Adapting to new technology
Reporting and providing real-time data
Communicating with other departments
Rules, regulations, and compliance
Let's dive into each of these challenges, and work out their solutions.
1. Managing Small Teams
Since 2021, there are 5.5 million small businesses in the UK employing between 0 and 49 people.
While this is fantastic for the economy, it does bring some unique challenges for finance managers in these organisations.
If you're a finance manager in a small business, you might find yourself wearing multiple hats to keep things running smoothly. This can include:
Handling day-to-day tasks: Beyond your managerial duties, you might need to dive into routine financial operations.
Taking on HR responsibilities: Without a dedicated HR manager, tasks like hiring and training new team members could land on your plate.
Shaping business strategy: You're not just crunching numbers; you're also contributing to the overall direction of the company.
These extra roles can feel overwhelming at times, but they also offer a chance to expand your skill set and make a real impact on your company.
How Can Finance Managers Overcome This Challenge?
To effectively overcome the challenges that come with managing small teams:
Communicate clearly: Setting clear expectations and keeping open lines of communication with your finance team is crucial.
Empower your team: Delegating responsibilities helps develop your team's skills and can boost productivity.
Recognise achievements: Implement recognition programs to acknowledge hard work and foster a positive work environment.
Prioritise tasks: Managing your time effectively can help prevent burnout and ensure important tasks get the attention they need.
By addressing these challenges proactively, you can turn potential obstacles into opportunities for growth—for both you and your team.
2. Adapting to New Technology in Finance Management
Let's be honest—keeping up with the fast pace of technological change is one of the biggest challenges for finance managers today.
In our digital age, sticking to traditional spreadsheets just doesn't cut it anymore. The digital transformation in finance is pushing us all to adopt advanced automation tools and cloud-based software to stay competitive.
In fact, over 70% of finance professionals are planning to invest in new technology like AI in the next five years.
Why is Embracing New Technology a Challenge?
Adapting to automation: Switching from manual processes to automated systems can feel overwhelming.
Data security concerns: New technology brings along new security challenges that we need to manage carefully.
Skill gaps: Not everyone on your team might be tech-savvy, which means investing time in training.
Cost implications: Implementing new technology can be expensive, especially if you're working with a tight budget.
Take the UK's Making Tax Digital initiative, for example. Aimed at transforming the tax system to be more effective and easier for taxpayers, it has required finance professionals like you to adapt quickly to digital reporting methods.
How Can Finance Managers Overcome This Challenge?
So, how can you overcome these finance challenges related to new technology?
Focus on the benefits: Understand how technology can streamline your processes and communicate these benefits to your team.
Invest in training: Provide opportunities for everyone to learn and get comfortable with new systems.
Start small: Implement technology in phases to make the transition smoother and less daunting.
Foster a tech-friendly culture: Encourage an environment where embracing technology is supported and celebrated.
By tackling these obstacles head-on, you're setting your organisation up for long-term success in the digital age.
3. Reporting and Providing Real-Time Data
In this day and age, data is paramount—especially in finance.
According to a survey from Deloitte, 49% of respondents said data analytics helps them make better decisions, 16% believe it enables key strategic initiatives, and 10% say it improves relationships with customers and business partners.
Despite these benefits, the need to report and provide real-time data can pose significant financial management obstacles.
You might find yourself dealing with:
Poor data quality,
Inaccuracies,
Or the time-consuming nature of manual data entry.
Slow data production can hinder your ability to develop effective financial strategies and support your broader business goals.
How Can Finance Managers Overcome This Challenge?
So, how can you overcome these finance challenges related to real-time data?
One effective solution is leveraging expense management software designed for simplicity and accuracy, like ExpenseIn.
ExpenseIn offers:
Real-time expense reporting: Access up-to-date expense reports to make smarter decisions.
Automated reports to your inbox: Receive expense reports directly in your inbox or even your SFTP server, so you can focus on more urgent tasks.
Comprehensive data analysis: Understand your company's expenditure with reports filtered by user, department, expense type, and more.
Seamless integrations: Use existing accounting and analysis codes to integrate data smoothly into your financial software.
With ExpenseIn, finance teams can:
Track big spenders: Identify which departments are spending the most.
Build custom reports: Create your own report formats to export the fields you need.
Simplify compliance & VAT recovery: Automate compliance processes, aligning every expense with your policies.
By adopting a business expense tracker app like ExpenseIn, you're transforming challenges into opportunities for efficiency and strategic business growth.
Ready to make expense management simpler? Book a free demo today and see how ExpenseIn can make your job easier!
4. Communicating with Other Departments
One of the common challenges for finance managers is effectively communicating with other departments.
As a finance manager, you're not just dealing with numbers—you also need to collaborate with colleagues across the organisation and engage with various stakeholders.
Since finance plays a crucial role in monitoring the funds flowing in and out of the business, clear communication is essential.
However, especially after the COVID-19 pandemic, many companies have teams spread out, with employees working remotely or across different locations. This new work environment can introduce obstacles like:
Unreliable internet connections,
And an overreliance on teleconferencing tools
All of which can hinder smooth communication.
Why Is Communication a Financial Management Obstacle?
Lack of face-to-face interaction: Remote work reduces opportunities for in-person meetings, making it harder to build rapport.
Misunderstandings: Without non-verbal cues, messages can be misinterpreted.
Technological barriers: Technical glitches can disrupt meetings and lead to frustration.
How Can Finance Managers Overcome This Challenge?
To effectively overcome these finance challenges related to communication:
Use clear & simple language: Avoid financial jargon when speaking with non-finance colleagues. Explain concepts in a way that's easy to understand.
Leverage collaborative tools: Use platforms like Slack, Microsoft Teams, or Asana to keep everyone connected and informed.
Schedule regular check-ins: Set up consistent meetings with key departments to discuss ongoing projects and address any concerns promptly.
Be mindful of time zones: When working with global teams, schedule meetings at times that are reasonable for all participants.
Build personal relationships: Take the time to get to know colleagues from other departments to foster better collaboration.
By proactively addressing communication barriers, you're turning one of the common financial management obstacles into an opportunity to strengthen your team's impact across the entire company.
5. Rules, Regulations, and Compliance
Keeping up with changing rules and regulations is one of the biggest challenges for finance managers today. The financial industry is heavily regulated, and staying on top of these changes can feel like a full-time job in itself.
In a survey of 1,100 financial services executives, a whopping 88% said they're challenged in managing regulatory changes.
Balancing compliance demands with profitability goals isn't easy, and it's a financial management obstacle many of you are grappling with.
To meet these compliance requirements successfully, you might find yourself:
Working longer hours,
Outsourcing tasks,
Or even hiring extra staff to handle the additional workload.
It's a tough balancing act, but essential to keep your organisation compliant and running smoothly.
How Can Finance Managers Overcome This Challenge?
So, how can you effectively overcome these finance challenges related to compliance?
Stay informed: Regularly check updates from regulatory bodies like the Financial Conduct Authority (FCA). Subscribing to industry newsletters or alerts can help you stay ahead of the curve.
Invest in training: Keep yourself and your team up-to-date with ongoing education on the latest regulations. Consider workshops, webinars, or certification courses.
Leverage technology: Utilise software to automate processes and reduce manual error.
Conduct internal audits: Regularly review your compliance procedures to identify and address potential issues early. This proactive approach can save you time and resources in the long run.
By tackling compliance head-on, you're safeguarding your company and contributing to its long-term success.
Overcoming Finance Manager Challenges with ExpenseIn
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We know that being a finance manager today isn't easy.
You're wearing multiple hats in small teams, trying to keep up with new technology, and feeling the pressure to provide real-time data. On top of that, you're navigating remote communication and keeping up with ever-changing regulations. It's a lot to juggle.
But you don't have to do it all on your own. ExpenseIn is here to lighten the load. Our easy-to-use expense management software simplifies your processes, gives you real-time insights, and helps you stay compliant without the stress.
Ready to make your work life easier? Book a free demo with ExpenseIn today, and let's tackle these challenges together.
