For years, the aim of digital transformation has primarily been to inject innovation and advancement into the workplace. After all, there’s always a better way we could be doing things—a tech solution that can make us more productive and more efficient.
While these shifts can still be felt in the outcomes of any technological workplace revolution, they’ve also largely taken a back seat in terms of priorities—for the time being.
The “why” of it is simple. Businesses everywhere are focusing less on technological innovation for innovation’s sake and more on expediting the kinds of transformations that will help them maximize healthy reliable cash flow and sustainability above all else.
In a recent survey of SaaS businesses, 61% reported a moderate to severe financial setback in 2020. An additional 18% reported at least a minor setback.
So while digital transformation efforts continue to be ongoing, they’re ongoing with slightly different objectives. Businesses are opting to upgrade to technological assets that provide clear operational value and cost-saving benefits.
The financial benefits of SaaS tech infrastructure
Architecting a carefully curated stack of agile SaaS solutions inherently make it easier to weave financial flexibility into a business. From cloud-based lead-finding tools to customer relationship management software, sales enablement apps, and automated billing solutions, businesses have a lot of options.
And by making targeted additions, cloud-enabled businesses can build integrated infrastructures that make the most sense to them at the drop of a hat.
For example, cloud-enabled businesses can rapidly pivot, upgrading, downgrading or migrating their digital subscription service plans. This enables them to increase their variable costs, decrease their fixed costs, and cater to their budgets in almost real-time.
This is a much different reality than having to rip and replace the expensive onsite legacy software solutions of yesteryears.
The more intangible cost-saving benefits of being cloud-based were on full display in 2020 when businesses all over the globe were forced to move out of the office and into the home. Businesses that were already equipped for this type of work environment were able to avoid lags in productivity, while those that were less prepared had to scramble to catch up.
And it turns out switching to a remote or hybrid work environment is an effective way to reduce costs as well.
A wide range of large SaaS businesses have announced they’ll allow employees to continue working remotely even when the pandemic is over—a cost-saving move that’s only possible with a digitally transformed tech stack.
- Add strategic automation: The injection of technologies like digital platforms and artificial intelligence have been shown to boost efficiency by up to 50%. With the right tools, employees make more strategic use of company time while ensuring important tasks stay on track.
- Reduce margins of error: Human error is a significant cause of lost company time and money. It’s also closely linked to cybersecurity threats and other factors that pose a risk to the financial well-being of any business. Cloud-based tech solutions sharply reduce the sting of human error by automating many common and complex tasks.
- Improve data accuracy: Business leaders can’t make the best decisions about what’s working and what needs to be cut out without accurate data. Adding SaaS solutions that enable data integrity make it possible to track and take action on the metrics that matter most to your business.
Additionally, the solutions you choose should integrate with your entire tech ecosystem to not only reduce any duplicate efforts related to data transfer, but also to ensure all departments have access to the accurate data they need to make the best business decisions.
Better revenue management through automated billing
Digital transformation can also have an enormous impact on a business’s finances in more direct ways.
Although a business’s revenue operations (RevOps) are most commonly associated with the efforts of marketing, sales, and customer success, your finance team and its technology solutions also play a key role in maximizing your monetization potential.
After all, every dime generated by your business’s traditional RevOps is dependent on your finance team’s ability to effectively invoice and collect on it.
Adaptive fintech like automated billing platforms feature an array of benefits that directly cut operating costs and enable better revenue management to make sure the cash keeps flowing.
- Automated billing and proration: By automating billing, businesses ensure a dependable, recurring cash flow that begins the moment they sign a new account. An adaptive platform also makes it easy to prorate billing so that businesses aren’t giving product away for free.
This makes a big difference for businesses that previously didn’t start charging new customers until the next billing period.
Automated billing software also significantly reduces the human effort spent on tedious tasks like invoicing and payment processing.
Not only does this change have the intangible benefit of saving time, but there are more direct cost-saving benefits as well. For example, a staff that has more time for customer communication and engagement is better able to reduce churn and stabilize MRR.
- Better dunning management: Lax dunning management is huge source of revenue leakage.
SaaS businesses lose an estimated 9% of their MRR to failed payments, making dunning a key factor in any cash-saving strategy.
By automating collection retries on failed payment attempts and allowing relevant departments to easily view and take action on aging receivables, significant leakage are prevented.
Billing platforms also automate email and text notifications to make it easy for customers to update their payment methods to prevent future issues.
- Accurate financial data: With an accurate view of your businesses revenue performance and cash runway, better decisions can be made about future strategies and direction.
Automated billing software provides granular dashboard views and reporting functionality for key SaaS metrics.
These SaaS solutions also integrate with accounting software to ensure accurate ledger data makes its way into revenue recognition and reconciliation processes.
Transform your SaaS stack to maximize revenue potential
It may be true that process innovation has taken the back seat for the time being. However, digital transformations still serve as a vehicle to ensure SaaS competitiveness in the future.
Businesses that are equipped with the cost-saving SaaS benefits explored above, including transforming and automating their financial processes, find themselves well-positioned not only to weather tough times but also to flourish at the first sign of opportunity. They also stand to gain a competitive advantage over the digital laggards.
After all, flexibility is the hallmark of a modern tech stack. With the right tools, SaaS businesses can maximize their profits, reduce their costs, and adapt to whatever position they may be in.