The hospitality industry is going through a digital revolution. With disruptive technologies like intelligent automation at the forefront of it, many organizations are optimizing their business operations. And for CFOs, this technological shift is a real game-changer. With automation, they can eliminate several inefficiencies arising from back-office operations that negatively impact overall productivity and the customer experience in their hospitality enterprise.
Back-office operations in a hospitality enterprise predominantly include payment processing, invoice management, document management, etc. When compared to the customer-facing front-office operations, the back-office operations deal with huge chunks of data. And processing such a vast amount of data involves a lot of manual, paper-based processes, and redundant tasks. By automating them, modern-day CFOs can empower their employees to deliver consistent results.
Let’s look at some of the ways in which CFOs can benefit from back-office automation in the hospitality industry.
For CFOs, report generation is a vital process that aids them in making crucial organizational decisions. But generating reports manually is tedious and time-consuming. With back-office automation, you can easily obtain accurate reports that will provide in-depth insights.
Some of the important reports that are generated with the aid of back-office automation include:
- Profit & Loss Report
- Balance Sheet
- General Ledger
- Trial Balance
- STR & GSS
- Daily Sales
Generating all the reports listed above will require immense time and effort from your employees, but with automation, you can get them done within a matter of minutes. It will increase the overall productivity while helping you analyze the company’s performance from a financial standpoint.
Planning, budgeting, and forecasting are three important back-office processes that determine the success of your hospitality business. Using traditional spreadsheets is the industry norm. However, modern-day CFOs need to look beyond it. As the level of competition is growing intensely in the hospitality sector, the data complexity is at an all-time high. And by relying on traditional methods, you are bound to fall behind your competitors.
Numerous planning tools and cloud-based systems are available in the market that will help automate these processes. Using predictive insights drawn automatically from data, hotels are able to identify evolving trends and make decisions with foresight rather than hindsight.
By embracing back-office automation, CFOs of a hospitality entreprise can:
- Measure and monitor performance with visualizations and self-service dashboards.
- Identify root causes through high-fidelity analysis of dimensionally rich data.
- Analyze trends and make predictions automatically using internal and external data.
- Conduct rapid what-if scenario modeling to create timely plans and forecasts.
- Respond to new threats and opportunities promptly.
- Reinforce the link between operational and financial plans.
#3 Better Cash Flow Optimization
One of the core goals of back-office operations is ensuring a streamlined inflow and outflow of cash to support the operations of the enterprise. By keeping tabs on the Accounts Payable Process and Accounts Receivable Process, CFOs can make sound decisions that will benefit the business. Automating this back-office operation using an AP automation software will help you understand the cash flow better.
For example, in a traditional hospitality enterprise, the AP department is always under pressure to do more with very less resources. And, with the huge inflow of invoices, the processing speed decreases drastically. However, with an automated AP workflow, the processing speed spikes up, where a single AP clerk can process up to 22500 invoices in a year.
Similarly, the AR department is filled with labor-intensive tasks. In many cases, employees must source data from incoming bookings, which makes it extremely slow and prone to error. Intelligent automation can take this human error out of the equation. By automatically sourcing the incoming booking information, generating downstream documents, and entering relevant data into the ERP systems, hotels can speed up the collection process, thereby improving the cash flow
Back-office automation provides powerful tools to hospitality businesses to improve their profitability and efficiency. They redefine the way tasks are allocated and performed in the back-office and come with many benefits that we have touched upon in this post. Even though back-office automation provides a competitive edge for a hospitality enterprise, CFOs must be careful in choosing the processes that will require automation. You must understand that some processes require a high level of human involvement and simply cannot be automated.