Business

Remote, Back to Office, or Hybrid? 4 FP&A Challenges to Consider

Published

2 years ago

September 24, 2022

The ongoing shift in the workplace, which has been nurtured by our ability to work remotely and the flexibility that companies need in order to cope with the unpredictable, has forced companies to rethink how and where they want to work: fully remote, return to the office, or hybrid work. Deciding which model fits their team best is a key strategic move, and it’s one that financial planning and analysis (FP&A) teams will have a crucial say in. There are, however, four important challenges that FP&A teams will need to tackle in order to provide the best support for their organizations. Let’s discuss them.

1. Understanding the shifts of a dynamic workplace

FP&As need to go beyond the numbers of their financial statements. In fact, they need to understand the trends that are shaping today’s workplace and the hurdles that a company may face if it opts to return to the office or go fully remote. In order to improve financial planning and deliver better insights, it is important for finance professionals to understand the implications associated with each option and the trends that are shaping the corporate world.

Based on data from various surveys, Nikodem Szumilo, Associate Professor at University College of London, and Thomas Wiegelmann, managing director of Schroder Real Estate, argue that there’s enough evidence that “most office workers actually want to go back to an office — but only two or three days per a week.” This kind of information should be taken into consideration by FP&As when measuring and forecasting things like productivity and retention rates.

Finance teams must understand the complexity that the various options in today’s workplace offer, as well as the fact that an option that suits employees best might not do the same for management. Finance can play a key role in making sure that both parties are happy, while also moving the company in a strategic direction.

Let’s look at this example: Many managers are eagerly looking forward to bringing employees back to the office to be able to physically keep tabs on their work progress. But if employees are rooting for a remote (or hybrid setup), it can be financed by a job to bring up tools like a project time tracker. Not only does this help managers have a better handle on their team’s work, but it also provides useful insight into business operations, finance, and daily decision-making.

2. Adopting a more strategic role

The modern finance department is rapidly moving from a transactional thinking approach to a strategic one. “The new operating model of finance recognizes the subject matter expertise of FP&A and its focus on delivering the best data for business decision-making,” explains Anders Liu-Lindberg, leading advisor to senior Finance and FP&A leaders.

Being able to meet that role will certainly be a challenge for many FP&A teams that are still solely focused on the transactional side of their business. Even if managing the cash flow is still an essential part of their job, finance professionals need to update their role within the organization. “The traditional roles of transaction processing and reporting remain, of course, but in an automated form that releases resources to explore value drivers in the business and move the focus to plan with an uninterrupted forward-looking view. FP&A is at the very heart of business decision-making,” argues Liu-Lindberg.

In terms of financial forecasting and financial planning, for example, FP&As should encourage their companies to truly understand where and how their employees would like to work. If they are able to gather and analyze such information, they will be able to better predict the amount of capital the company will need to invest in certain areas.

“If your organization is enforcing a strict back to the office mandate, you’ll likely need to plan for additional recruitment fees and training, as well as allowing for dips in productivity as you replace the people who inevitably resign,” argues Kevin Phillips, Founder, and CEO of idu Software. Considering this, if you are able to collect information about your employees’ working preferences, you will be able to forecast much more precisely.

3. Quantifying the impact of all the scenarios

Whether you are going fully remote, opting for a hybrid workplace, or going back to the office, this is one of the biggest challenges that FP&A teams need to face. In fact, in any of these scenarios, there are considerations to make from the financial point of view. According to Phillips, the following are the three things FP&A teams need to consider when quantifying the impact of each option:

Let’s review some of the practical costs that companies need to consider when opting for any of the three scenarios above.

Working from home 100%

If you decide that you and your employees are going to be working from home on a regular basis, “you need to account for mortgage and lease liabilities. What will it cost to get out from under a long lease agreement or to sell commercial real estate?” asks Janet Schijns, CEO of JS Group. Considering the crucial role that rent plays in any budget strategy, this is an important consideration to make.

Apart from lease liabilities, any financial planning needs to evaluate the remote setup costs that your employees may need. For those with a high-speed Internet connection, good hardware, and comfortable working space, things may be simple. However, for some other people, the remote setup costs could be steeper.

In fact, for “a telehealth provider or call center agent, you may need to cover VPN access, HIPAA-certified unified communications and collaboration licenses, secure cloud storage, improved broadband access, remote tech support, cyber insurance that covers risks associated with remote access and in some cases mobile devices and plans,” explains Schijns. On top of that, you may even need to reimburse some of your remote employees for the expense associated with their work.

However, going 100% remote work also offers some cost-saving benefits. Apart from not having to pay rent for a big office, the possibility of bringing remote hires into your team represents a good opportunity for saving money. “You can now hire top talent from anywhere in the world and pay them more than what they would earn locally, but less than what you’d have to pay at home. This is a win-win situation, especially for your salary costs,” argues Phillips.

Along those lines, FP&A teams must treat all the technological investment and organizational changes their companies adopted during the pandemic as an investment that favors the remote work option. The biggest cost of switching to remote or blended work is the cost of adapting to the new technology has already been paid. Nobody should commit to long-term remote work because they want to recover the sunk cost of moving online due to the pandemic. However, the pandemic irreversibly reduced the cost of switching to remote work and made this choice cheaper,” argueSzumilo and Wiegelmann.

Return to office

As we mentioned before, if you want everybody to go back to the office, your financial planning needs to consider the potential of facing resignations from employees who don’t want to lose the flexibility they gained during the pandemic. This will have an impact in terms of recruiting fees, training costs, and the additional perks you may need to offer if you want to persuade your top performers to stick with you.

Furthermore, any budget strategy designed around the option of going back to the office needs to bring into consideration some sort of investment in perks capable of compensating for the loss of flexibility and additional costs (e.g. commute, gas, lunches) that employees will need to pay when returning to the office.

Some companies are, indeed, already offering practical solutions to their employees. For instance, Bloomberg is giving its US employees a $75 daily commuting stipend while PwC in the UK is offering an extra £1,000 for commuters. “But these perks and stipends certainly don’t extend to all companies–meaning people are not only being asked to give up remote work but also spend more to do it,” argues writer Sophia Epstein.

The costs associated with healthy environments, however, are an element that should play an important role in the financial planning of any organization, and FP&As will play an important role in guiding companies in making the right investments. “More robust air filtration and newly installed outdoor spaces are among the items that will add to developers’ costs when more employees return. New cleaning practices may make those services more expensive, and landlords are offering new amenities to lure tenants back,” explains writer Julie Weed.

Providing this kind of guidance, however, can be a big challenge for FP&A teams that need to deal with top executives unwilling to incur those kinds of expenses. To tackle this, FP&A professionals need to quantify the potential effects of not implementing some of the needed structural changes. As stated by Nellie Brown, a health and safety specialist who provides training and technical assistance for New York State workplaces, “if you don’t spend money on upgrading your ventilation, you might be spending it on sick people.”

Hybrid workplace

Considering everything we mentioned about the two previous scenarios, it is easy to understand why a hybrid workplace has been embraced as the ideal to move forward by so many organizations around the world. While this model partly combines the disadvantages of the other two options, it fully combines the best of both worlds. For instance, with a hybrid work model, you will be able to improve your retention rate while saving costs on office space.

From the financial point of view, the reduction of office space is, in fact, one of the most attractive elements of a hybrid workplace. In fact, there is a broad consensus among CEOs that organizations will need less office space in the future. “This could drive significant cost savings in both operating costs and capital expenditures,” argue Deloitte managers James Griffin and David Asker.

In spite of these benefits, finance teams should carefully assess all the pros and cons that come with this model. In order to do that, FP&As will need to analyze the data accurately, and this could be a significant challenge for organizations that are still relying on spreadsheets and lack automation and data collection tools.

4. Making a strong business case

Right now, the business case that CEOs and top managers are using to justify the return to the office gravitates around two variables: productivity and management. The rationale is that some employees are more productive when they work in the office. Plus, many leaders think having everybody at the office allows managers to monitor the performance of those employees more effectively.

The problem with this rationale is that there’s little evidence that supports such claims. In fact, there are numerous surveys that claim just the opposite. Because of this, one of the most important emerging challenges faced by the finance controller today relies on its ability to provide guidance in regard to the business case that a company uses to justify the return to the office.

If you want to make your case in terms of productivity and management, you need numbers that support those arguments and this is where an FP&A team needs to provide support. However, coming out with those numbers may be difficult especially if productivity has been sustained during the health crisis.

An opportunity to update your company

Not all FP&A teams will need to deal with the challenges we mentioned above. For some companies, the decision to bring their employees back to the office has been already made with hardly any single financial consideration other than a space cost-saving strategy. In a world where so many people are scared to death to lose their jobs and so many managers need physical control to legitimize their roles, companies have found little to no resistance when ordering people to go back to the office.

However, companies that are truly interested in improving their KPIs, building a healthy corporate culture, and saving costs through a well-defined budget strategy and financial planning, need FP&A teams that are strategic and able to quantify (with the right tools) all the possible options to move forward. By doing that, they will not only provide valuable insights into the organization, but they’ll also reinforce the business case that companies need to persuade employees to do their best. Meeting the challenges we mentioned throughout this article represents a great opportunity to update and prepare your company for the future.

Related Topics:Business Featured FP&A Challenges

Business

Benefits of Switching to a Managed IT Service Provider Instead of DIY

Published

3 weeks ago

February 16, 2025

William Immelt

Managed services have become the main source of support and assistance in various business enterprises. Nowadays, you don’t need to focus on your own internal processes of data management and integration. Some professionals can handle every complexity in your business prospects. It not only helps you to manage your business data in a better way but also allows you to expand your business on a global scale.

Many entrepreneurs still question the need for managed IT services for their businesses. They feel that the expertise and support of internal staff are more than enough for business expansions. However, they are the ones who face consistent problems while managing errors and protecting data on their system. Managed service providers will ensure your system is safe and secure from external attacks. Not only that, but they will also take care of your business prospects so that you can interact better with your clients and create a global identity.

What Are Managed Services In IT?

Managed IT services refer to hired programs and techniques by which you can develop your business with the right strategies. MSPs are expert professionals with the right knowledge about IT requirements in your business. Therefore you will not only be able to do away with all problems regarding data management but also develop your business on the right track. It is very important to opt for various managed services like data processing and error handling to improve your business with better interactions. Managed IT services will help you achieve your short-term goals and focus on business expansion on a large scale.

Advantages Of Using Managed Services For Your Business

To bring about overall development in your business, you need the right techniques and tools for improving your business aspects. Applying DIY methods with proficiency in every case regarding your business issues is impossible. Only managed IT service providers can help you eliminate your system’s consistent lags and bugs. As a result, the overall processing and management will develop like never before. Here are some of the crucial advantages of using managed services rather than taking care of your business single-handedly:

Experience

MSPs have great experience in data management and business development. They will help you utilize the right tools at the right time for a better online presence. Not only that, but you will also be able to improve traffic to your website and attract more clients as and when you start using export techniques of managed services.

Vulnerability Management

One of the prime benefits of using managed IT services is the idea of probable threats to your system. Internally you can develop your website and make amends when you discover abnormalities. On the other hand, professional MSPs will help you avoid the problem by securing your system right from the onset. So no such problem will occur shortly.

Improved Techniques

Managed IT services include advanced tools and techniques by which you can edit your data according to the latest trends. It will positively affect your business, making it even more attractive to prospective buyers. MSPs use modern techniques with the best strategies to bring out favorable results.

Security concerns

Managed service providers also carry out important security management programs on your system. It means that your system will be secure from external attacks and remain protected from internal checks and balances. Therefore you need not go through every little detail as and when notified about security concerns.

Developed business strategies

The strategies provided by MSPs are undoubtedly the best for your system. Moreover, they also create unique ways your business can develop online. It will mainly focus on your business patterns and create new beginnings. Improve the uniqueness of your website with the best strategic programs by managed services.

Outsourcing

One of the main ideas in online businesses is outsourcing. It is the only way by which you can reach out to more clients and expand your business online. However, sharing and transferring business data without proper security on your system becomes problematic. Managed services will help you achieve this aim in no time. MSPs will protect your system so you can easily interact with clients over shared platforms without fearing cyber crimes.

Scalability

You can easily improve your online presence with better interactions and unique business development methods. Crucial matters like SEO handling, content creation, and data integration play a vital role in business development. Managed services will provide unique strategies by which you can improve the scalability of your website and become more accessible.

Better interactions

Your communication with your clients and investors will improve with the help of authentic managed IT services online. It will provide the best possible outcomes because you can regularly interact without hiding your content. Features like two-factor authentication and data in visibility will help you share your content with people you trust, thereby creating a massive online presence.

Conclusion

Managed IT services have become the new-age developmental technique by which you can improve your business in a great way. The only thing you require is an efficient system on which the professionals can work daily. Once you start using the advanced Tools and techniques, you will understand the difference yourself. Moreover, online standard-managed IT services will help you work on your errors remotely. Make sure you choose the right services for your business and utilize the prospects with professional help from managed IT service providers.

Business

How to Start a Solar and Energy Business in The London

Published

3 weeks ago

February 15, 2025

Daniel Egusa

Start a Solar and Energy Business in London

London is one of the largest cities in the world, and as such, it has a significant energy demand. With increasing concerns over climate change and the need for sustainable solutions, the solar and energy industry has grown rapidly in recent years. This blog will explore London’s solar and energy business and industry.

Solar and Energy Business Opportunities in London

London’s solar and energy industry is diverse, with various opportunities for businesses to capitalize on. Some of the business opportunities in the industry include:

1. Solar panel installation

London is a prime location for solar panel installation, with an average of 1,461 hours of sunshine annually. Businesses specializing in solar panel installation can provide clean energy solutions to homeowners, businesses, and local governments.

2. Energy storage systems

Energy storage systems are critical for ensuring a steady clean energy supply. Businesses specializing in energy storage solutions can help consumers optimize their energy usage and save money on electricity bills.

3. Smart home technologies

Smart home technologies, such as smart thermostats and lighting controls, can help consumers reduce their energy usage and save money on energy bills. Businesses specializing in smart home technologies can provide innovative solutions to meet the needs of consumers in London.

4. Electric vehicle charging infrastructure

With the UK government’s goal to phase out the sale of new petrol and diesel cars by 2030, the demand for electric vehicles is expected to increase significantly. Businesses specializing in electric vehicle charging infrastructure can provide consumers with convenient and accessible charging solutions.

Steps to start a Solar and Energy business in London

Starting a solar and energy business in London can be rewarding and lucrative, but it requires careful planning and execution. Here are the steps to follow to get your solar and energy business up and running in London.

1. Conduct market research

Before starting any business, it is essential to conduct market research to understand the demand for your products or services. Identify your target customers, their needs, and preferences, and evaluate the competition in the area. This will help you determine the viability of your business and develop a business plan. Market research is a critical step in starting a solar and energy business. It involves gathering and analyzing information about the market and the potential customers to determine the demand for your products and services.

2. Develop a business plan

A business plan is a roadmap that outlines your business goals, strategies, marketing plans, financial projections, and operations. It should also include information on your business’s legal structure, licenses, permits required, and funding options.

3. Choose a legal structure

Decide on the legal structure of your business, whether it is a sole proprietorship, partnership, limited liability company (LLC), or corporation. Each has advantages and disadvantages, so consult a legal professional to determine the best option for your business. Choosing the right business structure is important when starting a solar and energy business.

4. Register your Business

Register with the Companies House and obtain the necessary permits and licenses from the local government. This includes obtaining a business license, registering for VAT, and registering with HM Revenue and Customs. Register your business with Companies House, the UK government’s official registrar of companies. You can register your business online or by post, and you must provide details such as your business name, address, directors, and shareholders.

5. Secure funding

Determine your startup costs and secure funding to cover these expenses. This may include personal savings, loans, grants, or investments from family and friends. You can also use alternative financing options like crowdfunding or peer-to-peer lending.

6. Develop a marketing strategy

Develop a marketing strategy to promote your business and attract customers. This may include creating a website, and social media accounts, networking with industry professionals and attending trade shows.

7. Hire employees

Hire employees with the necessary skills and experience to run your business. This may include salespeople, installers, and administrative staff.

8. Source suppliers and equipment

Source suppliers and equipment necessary for your business operations. This may include solar panels, batteries, inverters, and other necessary equipment.

9. Launch your business

Launch your business by promoting your services and products to potential customers. Attend events, create marketing materials, and establish a presence in the community.

10. Continuously evaluate and improve your business

To ensure long-term success, assess and improve your business operations. This includes monitoring financial performance, customer satisfaction, and industry trends. Make adjustments to your business strategies as needed.

Conclusion

In conclusion, starting a solar and energy business in London can be rewarding and profitable. With the increasing demand for renewable energy solutions, there is a growing market for solar and energy services and products. However, starting a business requires careful planning, hard work, and dedication.

Once you launch your business, evaluating and improving your business operations is important. This includes monitoring financial performance, customer satisfaction, and industry trends. By making adjustments to your business strategies as needed, you can increase your chances of long-term success.

With a well-developed business plan and a commitment to excellence, you can start a solar and energy business in London that meets the growing demand for renewable energy solutions and helps build a sustainable future for our planet.

Business

Understanding the Outward RDC: How Royal Mail Ensures Seamless Delivery

Published

2 months ago

January 22, 2025

Daniel Egusa

The Royal Mail, a cornerstone of the UK’s postal system, has long been synonymous with reliability and efficiency. At the heart of its operations is the Outward Regional Distribution Centre (RDC). These hubs are vital for ensuring parcels and letters are processed and dispatched swiftly, meeting the expectations of millions of customers.

According to Royal Mail’s 2023 operational report, RDCs handle over 1.5 billion parcels annually, highlighting their importance in the logistics network. Let’s take a closer look at the role of the Outward RDC and how it helps achieve seamless delivery.

What is an Outward RDC?

An Outward Regional Distribution Centre is a facility within Royal Mail’s extensive logistics network that processes outgoing mail destined for other regions or countries. It acts as the first major hub where mail collected from various post offices and collection points is sorted, organized, and dispatched to its next destination.

On average, an Outward RDC can handle up to 500,000 mail items daily, depending on demand. These centers are equipped with advanced tools and skilled workers to manage large volumes efficiently, forming the backbone of the Outward RDC Royal Mail operations process.

Key Functions of an Outward RDC

Mail Sorting and Organization The main role of an Outward RDC is to sort mail by its destination. Sophisticated sorting machines scan barcodes, read addresses, and organize parcels and letters for their respective routes. These machines can process up to 40,000 items per hour, ensuring a fast workflow.
Labeling and Dispatch Once sorted, mail items are labeled with route-specific details and prepared for transport. Royal Mail’s fleet of 49,000 vehicles ensures timely delivery from RDCs to local delivery offices.
Integration with Other Hubs Outward RDCs act as a link between local post offices and inward distribution centers, ensuring a seamless transfer of mail between different stages of the delivery process.
International Mail Processing For international deliveries, RDCs collaborate with customs and carriers. Royal Mail’s connections span over 230 countries and territories, enabling smooth cross-border logistics.
Quality Control Checks Rigorous checks are performed to ensure mail items are sorted and labeled correctly. Automated systems have reduced error rates to less than 1%, significantly improving reliability.
Special Handling for Fragile Items Outward RDCs provide specialized care for fragile and high-value parcels. Around 5% of daily parcels fall into this category, requiring extra attention.
Emergency Response and Delays Mitigation During disruptions like extreme weather or strikes, RDCs implement contingency plans to minimize delays. For example, in 2022, RDCs rerouted over 150,000 parcels to maintain on-time deliveries.

What Does Outward RDC Volumetric Acceptance Mean?

This process determines the volume and size of mail handled by the RDC. Advanced sensors measure parcel dimensions with an accuracy rate of 99.9%, ensuring efficient categorization and resource allocation.

What Does Outward RDC Handheld Acceptance Mean?

Handheld devices allow staff to scan and log parcels into the system. This step ensures real-time tracking, improves accuracy, and confirms all items are accounted for before dispatch. On average, handheld devices process 10 million scans per day at RDCs, providing customers with reliable updates on their parcels.

The Technology Behind Outward RDC

The efficiency of an Outward RDC is driven by advanced technology. Automated sorting machines, optical character recognition (OCR) systems, and tracking software streamline operations. OCR systems alone process over 40,000 parcels per hour, reducing manual intervention. In 2023, Royal Mail invested over £20 million in upgrading these technologies.

Benefits of the Outward RDC System

Speed and Efficiency: Centralized sorting enables next-day or same-day delivery, with 85% of parcels arriving on time.
Scalability: RDCs adapt to seasonal peaks, handling up to 30% more parcels during holidays.
Enhanced Accuracy: Automation ensures mail reaches the correct destination, minimizing errors.
Cost-Effectiveness: Improved processes have reduced operational costs by 15% since automation began.
Eco-Friendly Practices: RDCs recycle over 70% of operational waste and utilize energy-efficient machinery.
Real-Time Tracking: Customers can track their parcels seamlessly, fostering transparency and trust.
Global Reach: With access to international networks, RDCs support deliveries to over 230 countries.
Support for SMEs: Over 50% of parcels processed daily come from small and medium-sized businesses, boosting their market competitiveness.

Challenges Faced by Outward RDCs

Volume Spikes: During peak periods, larger RDCs process over 700,000 parcels daily, stretching resources.
Technological Upgrades: Upgrading systems requires significant investment and regular maintenance.
External Factors: Weather disruptions and geopolitical issues can impact delivery timelines.
Cybersecurity Threats: Protecting sensitive customer data remains a top priority.
Sustainability Goals: Balancing eco-friendly practices with operational demands is an ongoing challenge. In 2022, Royal Mail reduced carbon emissions by 18% compared to 2018 levels.

How the Outward RDC Ensures Customer Satisfaction

Royal Mail’s Outward RDCs consistently focus on customer satisfaction by:

Training staff to maintain high standards.
Implementing sustainable practices that align with environmental goals.
Providing real-time parcel tracking and delivery notifications. These efforts ensure the seamless delivery promise is upheld, even during high-demand periods.

Conclusion

Outward RDCs play a central role in Royal Mail’s operations, ensuring parcels and letters are delivered efficiently and reliably. With advanced technology, skilled teams, and a focus on sustainability, these hubs are key to meeting customer expectations. As logistics demands evolve, the Outward RDC will remain essential to Royal Mail’s mission of delivering excellence every day.