Why a digital capital expenditure workflow accelerates budget approvals

Capital Expenditure Workflow Software

Investing in fixed assets has a strong impact on both short and long-term financial standing of a company. Therefore, managing capital expenditure / CapEx approvals requires enormous effort and attention to detail to avoid errors. 

Many organisations hesitate when it comes to investing in new and advanced systems for operational activities. This is simply down to trying to “cut costs” and avoiding spending. Even for good reason.

However, investing in software that allows the capital expenditure approval process to operate effortlessly does wonders. And, this investment actually contributes to less cost. And more profitability in the long-term.

It is critical for businesses to use appropriate guidelines and tools to carry out efficient financial analysis. And subsequently, finance and budget approvals. In other words, capital expense management can be much more expensive and complicated than necessary. That is, when using insufficient systems or methods. 

Capital Expenditure commonly known as CapEx or CAPEX is the expenses needed for businesses to either acquire or maintain their fixed assets. This includes fixed assets such as land, plant, machinery, equipment and so on. 

Operational Expenditure / OpEx on the other hand refers to the funds needed for day-today operations of a business. This might include rent, lighting, inventory and other utilities for instance.

CapEx and OpEx appear to be terms that are frequently confused by people. They both relate to required funds. But, they distinguish between type of expenses.

Some organisations still use outdated financial systems for capital expenditure and budget approvals. Despite being in the digital era with plenty of technological solutions available. What’s more, many are even carrying out budget approvals manually. For example, with spreadsheets, emails, paper-documents and even ledger books. 

Are you one of them?

If so, keep reading and find out how you can digitise your capital expenditure workflow and easily speed up budget approvals!


COVID-19 is accelerating digital transformation

However, with COVID-19 in mind, accelerating digital transformation is becoming the norm. That is, for business survival and to continue to grow throughout these uncertain times.

A recent article by Silicon Republic highlights a significant benefit derived by those who have digitally transformed their business. Moreover, the organisations who have mostly embraced digital business technologies. This competitive advantage simply wins against their competitors. 


Challenges of manual management of capital expenditure approval workflows

Today, many organisations still largely rely on manual methods to carry out CapEx approvals. Unknowingly, they enable the business to fall victim to many potential issues. More clearly, to problems that revolve around the drainage of business resources.

From lost time to lost CapEx requests, organisations tend to look for ways to cope with the issues that arise with manual budget approvals. That is, to compensate for the lack of efficiency. 

Certain issues that often erupt with manual CapEx approvals:

    1. Low visibility and transparency of requests and approvals
    2. High % of errors, duplication of data or missing data
    3. Inaccurate budgeting and forecasting
    4. Unauthorized spending, over-spending and loss of profit
    5. Missed deadlines, projects not being closed and new projects being opened
    6. Inefficiencies and bottlenecks in approvals

What is the meaning of CapEx software?

A capital expenditure workflow software is specially designed to allow the budget approval process to flow quickly and smoothly. And, without incurring any inefficiencies throughout. Capital expenditure software aims to digitse CapEx workflow. It enables businesses to standardize, track and approve requests, all in a single platform. Using an automated capital expenditure workflow helps speed up requests and budgets approvals while aligning with strategic goals.

Digitalising CapEx approvals helps reduce cost, save time, enhance productivity and improve profitability. Overall, a digital capital expenditure process capitalizes on the saying “work smarter, not harder”.

As previously mentioned, manually handling your CapEx approvals is an insufficient method. Additionally, tedious manual work threatens the quality of the process. Not to mention, these challenges unavoidably have knock-on effects on the entire business. 

In short, the adoption and implementation of a potent CapEx approval workflow software is simply to mitigate risks. Particularly, risk associated with a manual capital expenditure workflow.

Replacing your inefficient CapEx approval workflow with a robust workflow software like Kianda will not only tackle challenges above. But, will derive substantial benefits for your organisation.


Benefits of using CapEx software to manage budget approvals

Benefits of CapEx workflow softwareIn order to meet expected end year financials, capital expenditure budgets are set in place. Using CapEx software helps businesses to align with these strategic goals. Simply, by accurately managing capital spending.

With thorough insight into budget approval, it is easier set realistic financial forecasts. And, it is easier to meet and achieve those objectives and goals. Specially in terms of profit and business growth.

Let’s have a look at the benefits of using a business process automation platform for CapEx approvals.

CapEx software minimizes risk of human error

A major driving force to implement an automated capital expenditure solution is to slash risk of manual error. Way too often, mistakes can happen whereby requests and budget approvals are routed in the wrong direction. Because of this, requests can regularly go unanswered. As a result, delays and bottlenecks occur in capital expenditure processes.

Additionally, many projects can easily get lost. So, new projects open while teams are unaware or forgot to close ‘lost’ projects. Before you know it, the previous requests are completely hidden. On the other hand, fixed assets are critical for businesses to operate. As an example, not completing approvals for integral components of a critical production line is dangerous for business. Simply because, it can cause defects and errors in production and operations. 

With a digital capital expenditure workflow, all data is centralized in a single system.  This offers visibility and transparency to all stakeholders involved. As well, you can send automatic notifications and reminder alerts to stakeholders. Simply, so they approve requests on time.

As a result, you will never miss a deadline and you can minimize back-logs in requests. Moreover, completing all CapEx approvals on time allows business to run smoothly. For example, a critical piece of equipment could need maintenance or replacement. So, an employee raises a request. Automating the capital expenditure workflow ensures that this request is sought to. 

Automated workflow assists in providing accurate and realistic financial forecasts

When budget approvals are not completed on time or they simply get lost, it is a difficult process. For instance, it is hard to include their expenses when undergoing capital expenditure budgets. More importantly, this can result in inaccurate representations of capital spending. These capital expenses are not accounted for in budgets and can initiate overspending

Consequently, transparency lacks into the short-term financial standing of the company. And therefore, financial planning and long-term strategic goals become a complex process.

Abandoning manual CapEx approvals and digitally transforming them makes budget approvals seem like a breeze. With higher visibility, business process automation assists in greater control. Particularly over capital spending and budgeting. You can easily track and manage budget approvals. That way you can ensure budgets align with financial plans. And that is without being bombarded with unanticipated expenses. And, or emails with queries.

A digital workflow increases productivity and profitability

Automation increases the pace of routing requests and approvals. Overall, it gets the job done fast and efficiently. Many potential issues can arise throughout capital expenditure approvals when using spreadsheets and emails. Consequently, the process of CapEx approvals pause at many stages. Manual errors in the life cycle of any process drive down productivity.

As well as that, many organisations just accept these faults in their traditional CapEx approval processes. They then end up devoting more time and money to overcome them as they occur. Rather, they could look for a win-win solution. One that avoids negatives and brings positives.

Automating capital expenditure workflows focuses on preventing disturbances in the CapEx request/approval life-cycle. By simply eliminating errors from arising, the process is already much faster than before. Then, preserved time can also be dedicated to completing more budget approvals. That way, a lot more capital expenditure work is being completed rapidly. Ultimately, scaling both productivity and profitability. 

It is time to leave manual re-work behind you by digitally transforming your inefficient capital expenditure approval workflow.


Why you should automate your CapEx approval workflow

invest-for-growth

Investing into a state-of-the-art business process automation platform will help you digitally transform your financial approval processes. For the better!

Hassle free capital expenditure management doesn’t only aim to save time and costs. But, it makes employee work that bit easier and less stressful. Budget approvals and financial analysis require careful consideration. In which, only passes on pressure to employees.

Automating CapEx approvals simply relieves this pressure. Simply by tackling any challenges caused by manual budget approval workflows. Providing an easier method for CapEx approvals is not only beneficial to your employee. But, it is a key contributor to quality in your business processes.

Easing the capital expenditure workflow with digital tools allows employees to pay less attention to “preventing human error”. But, more attention on completing financial approvals with quality in mind. And, at a faster pace.

With CapEx approval software, employees can sharply get their work done. What’s more is that they can do it without feeling strained or burdened.  

Want to see how Kianda can help you? 

Request your live demo today!


Related articles:

How a digital approval process can help you accelerate decision making

https://www.kianda.com/blog/5-key-challenges-of-manual-approval-processes-and-how-you-can-overcome-them/

How a digital approval process can help you accelerate decision making

Improve-approval-process-with-business-process-automation

According to McKinsey, 60% of employees could easily save 30% of their time by automating business processes such as paper approvals and processing documents. Business process automation helps improve decision making to carry out ripe approval processes. 

In one way or another, before beginning many business tasks, a formal approval process is undertaken. With that said, one business process alone can require multiple approvals. That is, depending on particular variables such as project size, departments involved and so on. Therefore, business processes can quickly be prolonged or delayed if approvals are not completed on time. 

Handling approval processes without an agile method or system can be chaotic and quite difficult to manage. On the bright side, there is a solution; workflow software.

So, we want to show you how a digital approval process can help you accelerate decision making. As a result, your organisation can maximize efficiency and become more agile.

What is an approval process?

An approval process is implemented in order to allow business processes to run more smoothly and efficiently. In particular, it helps to digitally transform approval stages of business processes through automation. 

Overall, business process automation standardises tasks in an organisation by efficiently routing request information and related documents to relevant personnel.

You can rest assured that work will be approved the same way each time through by automating approvals through business process automation. 

Traditional ways to complete an approval process involve stakeholders having to manually approve data and documents. Additionally, a lot of time is exhausted tracking down and transferring documents whether it be via email, shared spreadsheets or paperwork. Not to mention the additional phone calls or messages regarding queries and so on. 

Might we say, many organisations have already began moving away from paper-based methods to digital ones to carry out approvals and other business processes. With that said, some have still not begun their business process automation journey.

Yes, these methods do get approvals completed. However, are they sufficient? The answer is no.

Using many forms of communication and methods slow down the approval process and automatically cause delays and bottlenecks in overall process. As well as that, it can be confusing to say the least.

In other words, still actively using traditional tools to carry out approval processes could well be limiting your organisations levels of productivity and efficiency. 

With workflow software you can easily approve, digitally sign and collaborate, all in a single place.


Types of approval processes to automate with workflow software

Here are 4 examples of approval processes that you can automate:

1. Capital Expense Approvals

CapExAlso known as CapEx approvals, this process can be difficult for any organisation, especially when it involves multiple approval levels. And, it normally does. Capital expense approval processes require careful consideration and decision making. Simply because, investing in machinery, equipment and other assets is largely expensive.

And without transparent insight and inaccuracy, decision making for an approval process is inevitably affected. 

On the other hand, using workflow software for your CapEx approval process provides consistency, accuracy and improves visibility. As a result, managers and teams can confidently make better decisions when approving. 

2. Purchase Order Approval

purchase order PO Approval can be lengthy and time-consuming as it is, never mind how long the process is when handled manually. Using paper, emails and spreadsheets is without a doubt slowing your purchase order approvals down.

Needless to say, they can incur quite a lot of expenses also. But, we don’t need to tell you that, right?

Workflow software can mitigate these issues by allowing you to streamline your purchase order process. Business process automation provides a faster approach to purchasing, facilitating a reduction in time and money spent on the job. As well, automation reduces the probability of human error in a PO approval process. 

3. Budget Approval

Budget approval processBudget approvals are essentially put in place to ensure that financial projections and priorities are in line. In order to plan strategically, businesses need to firstly, set out realistic budgeting guidelines and abide by them. And secondly, to observe these budgets with an eagle’s eye to decide whether to approve or reject. 

Without a consistent and skillful system to manage budgeting, it is a complex process that presents a lack of visibility into the financial state of an organisation. As a result, the business can fail to see an authentic view of the future due to an unrealistic projection.  

Automating your budgeting approval process will allow financial teams to guarantee that expenses align with the company’s financial forecasts. By accurately managing expenses, organisations can ultimately reduce operational costs. 

4. Project Approval

Project approval Undergoing a new project entails a variation of different project documents and deliverables. Hence, a close eye is necessary for review and approvals of certain documents to ensure efficient management of the overall project. 

Handling project approval processes through emails provides an opportunity for emails to become lost or convoluted in threads. As a result, approvals can pile up and the overall task can be delayed and if multiple projects are awaiting approvals, a back-log of projects will occur. 

The ability to transform tasks with business process automation presents better tracking, monitoring and approving at a faster pace. In doing so, projects can kick-start without any delays or issues in the process.

There are many approval processes that can be optimised through business process automation. For more insight read articles on our procurement process, leave/holiday requests or travel requests 


Benefits of an automated approval process

Your organisation can retrieve substantial advantages from a single approval process automated. 

1. Rapid approvals save time

Business process automation entirely speeds up the approval workflow from initiation to completion. As a result of rapid approvals, business processes accelerate, allowing your organisation to complete tasks in a timely manner. By reducing the amount of depleted time and other resources dedicated to business process management, companies instantaneously cut costs. 

2. Increase productivity

Emphasizing on the capabilities of faster approvals, business processes are accomplished quickly and efficiently. In other words, business process automation allows companies to become more agile as it scales productivity. On that note, thriving productivity helps you keep in line with competitors and not fall behind. 

3. Improve transparency and collaboration

Having a better overview of approvals is better for everybody right?

With an intuitive workflow software, customisable dashboards provide insight into status of approvals as well as outstanding ones. Also, tracking allows you to see who is responsible for each approval and improves decision making. The ability to collaborate in a single place reduces errors and miscommunication across relevant departments involved in the process. 

4. Reinforce accountability 

Approval workflow software clearly demonstrates who is assigned to which tasks or approval. Subsequently, all involved know exactly who is responsible, allowing for superior communication and accountability

5. Enforce compliance with company policies

Automating your approval process enables better record keeping and tighter security control across the organisation. Also, controls ensure the correct measures and validations are in place. Because of this, you can easily review and check whether approvals comply with company policies in audits. 


Why you should automate your approval process

Business process automation derives many advantages for both the company and persons undertaking the task in itself. Besides reducing costs, improving productivity and decision making, and generating competitive edge, professionals can reduce overloading work through automation. That is, from the C-suite level right to the front line.

For instance, CEO’s spend a significant 20% of their time analysing, reviewing and approving work that could be easily automated. And that is one person. Many other employees throughout an organisation could also have a lot more free time on their hands to spend on other tasks. 

Digital transformation continuously grows and evolves everyday. We at Kianda suggest starting slowly but surely to convert your business into a digital workplace.

Many organisations have already digitized and automated many business processes, while others are only beginning their journey. Some particularly undergo business process automation to improve a particular business process. While, others focus more on the end-user experience of a business process and how to make their everyday work life a tad bit easier. Additionally, improving quality of work in your organisation will reflect the quality externally, by satisfying your customers. 

Regardless of the objective in question, business process automation has ultimately provided competitive advantage for many.


How does Kianda approval process work?

Approval-process-Kianda-business-process-automation-platformKianda workflow software provides a user-friendly approval software. 

As a requester you simply input relevant details about the approval process in question via Kianda form. For instance, description of the request, related department, purpose and estimated cost. Providing information relative to cost and department allows for better allocation of expenses accordingly to the overall budget of the business. 

You can also upload documents that go hand-in-hand with the approval. That way, all necessary information is included in the request, avoiding miscommunication. 

Kianda provides an intuitive process designer interface for admin users to easily tailor approval process without the need of coding. Based on your organisation’s unique needs, you can customize your approval process to suit specific requirements.

Admin users can assign particular users’ access to approvals, enabling better transparency, security and accountability. In addition, you can easily add extra approval levels based on a business logic such as the project size or required number of approvals

Managers and relevant personnel can track, monitor and manage approvals with a built-in, customisable dashboard based on real-time analytics. As well, you will receive notifications to ensure that approvals are completed on time. 

Read case study: Mercury Engineering transforms project approval process using Kianda.


Transform your inefficient approval process with workflow software

Streamlining approvals will prevent delays and bottlenecks in business processes. Improving the quality and flow of approvals makes decision making easier for stakeholders. As a result of better management of the approval process, productivity and profitability drive up.

Let us show you with a free live demo, how Kianda can help you.

Request your live demo today!


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