This is a question that financial departments ask who find themselves managing capital expenditures using ledger books and spreadsheets. Isn’t there an easier way of doing this? Isn’t there a more effective and efficient way of managing CapEx?
In today’s digital landscape, there is, indeed, an answer, and it calls for a new way of managing capital expenditures that goes beyond keeping tallies in a book.
Software used to manage capital expenditure is a fundamental part of any business that wants to streamline its processes and make portfolio management and decision-making activities a better, more effective experience.
Let us begin with several questions that financial department stakeholders often pose when it comes to CapEx management:
Should I lay out a large investment in new hardware and software and spend money on continuously training employees on keeping CapEx running daily with the knowledge that I will have to repeat the whole process sooner or later? Essentially, Am I to re-invent the wheel with each new portfolio?
Or:
Should I use software that enables my business to plan, budget, and execute all CapEx projects while ensuring that requests pass through the right hands in sequential order until a portfolio has been decided on? What about storing all CapEx-related data in a single interface to have complete visibility into each project aspect? Is automation the solution for me?
When these two questions are put side by side, it becomes clear why more businesses are embracing CapEx software.
A CapEx software solution allows you to automate and streamline the CapEx lifecycle while standardizing and tracking every aspect of it. CapEx software enables you to execute projects and review them post-investment, from forecasting and budgeting to requests and approvals.
CapEx software users can also benefit from its ability to deliver on:
- Multi-year CapEx planning and budgeting
- Budget imports and exports from other systems
- Planned and unplanned carryover
- The use of Multi-currency
- Forecasting with forecasting scenarios
- The use of CapEx forms
- The Delegation of Authority
- Automatic Approval Request
- Email Approvals
- Mobility
- Auditing and tracking
- Reporting
CapEx software has become so widely used that it is tremendously simple to use and highly effective.
If your goal is to reduce costs and improve efficiency while gaining a competitive advantage, you will benefit from automation. CapEx software can streamline every aspect of your CapEx lifecycle from the beginning of the budgets and forecasting to the completion of your project. Modern businesses automate their CapEx lifecycle to bridge the gap between information across all departments in a company to enable employees to increase visibility, transparency, and standardization when it comes to CapEx.
CapEx software succeeds where manual efforts fail because it is the next step in managing capital expenditures. Organizations and businesses that still rely on excel spreadsheets to manage their CapEx require input from multiple stakeholders, resulting in lost time, lost CapEx requests, and delays and disruption to CapEx projects. Businesses that do not automate their processes also experience a loss of controls which leads to unauthorized spending.
Manual efforts will manifest the following issues:
- Inaccurate CapEx budgets and forecasts
- Project delays
- Unauthorized spending
- Inability to deal with the complexity of multi-currency scenarios.
- Insufficient reports
- High Error percentage and poor quality in business cases
- Inefficiency among stakeholders
- Loss of profit
- Low visibility
- Failure to manage Operating Costs (OpEx)
Do any of this hit close to home?
If they do, let us investigate. When you deploy CapEx software, you are in complete control of your:
- CapEx budget
- CapEx project
- Delegation of authority
- The CapEx approval process
By making spreadsheets a thing of the past and moving away from using email for CapEx requests, you will see an increase in efficiency with CapEx execution. At the same time, you will get on the road to giving your business better visibility because you will have real-time financial metrics to pinpoint the best investment opportunities.
Analyst Bottom-Line
Your business faces increased competition and pressure on your margins. Forward-thinking companies are automating their CapEx so they can continue to stay competitive and a step ahead. You see when CapEx is managed effectively, profit margins increase, and projects remain on budget. This way, a business runs seamlessly, making it possible to do exactly what needs to be done: keep department heads focused on big picture solutions.
Today’s competitive environment requires us to stay ahead of the pack. We need to create room for constant growth. Capital expenditures play an essential role in this process. By automating the CapEx process, you can be sure to gain a competitive edge by making the best investment decisions possible.
