Optimizing Financial Processes

A broker told a 165-person company they were "too small" for self-funding. That broker made $72,000 annually keeping them fully-insured. The company switched anyway and saved $340,000 in Year 1. Here's what "too small" actually meant. Fully-insured premium: $1.44 million annually. Renewal at 8.9%. The CFO asked about self-funding. Broker's response: "Companies your size can't handle catastrophic claims. One $500K cancer case could sink you. Fully-insured is safer." What he didn't say: His $72K commission was the same either way. But self-funded meant actual work—managing claims data, vendor relationships, quarterly reviews. Fully-insured meant forwarding emails and collecting checks. They brought in a second advisor. Level-funded structure: $103,000 monthly fixed payment covering admin, stop-loss, and expected claims. Total: $1.236M annually. Year-end actual claims: $847,000. Surplus refund: $73,000. Effective cost: $1.163M vs. $1.57M renewal. Savings: $407,000. The real win? Visibility. They discovered 6 employees with chronic conditions weren't getting proper care management. Added health coaching and medication monitoring. Year 2 claims for those employees: down 34%. Better health outcomes, lower costs. Also found their PBM charging undisclosed $180-per-claim admin fees. Renegotiated them out. Another $94,000 saved annually. Two-year savings vs. staying fully-insured: $763,000. "Too small for self-funded" means "I don't want to do the work." Most 50-250 employee companies can self-fund successfully with proper structure and stop-loss coverage. The question isn't size. It's whether your advisor will actually work. You're not too small for transparency. You're not too small for control. You're not too small to deserve an advisor who earns their commission.

When KPIs are measured in silos. Every department hits its targets—while the mine misses its goals. Our last discussion on silos in mining education sparked an overwhelming response. Many of you pointed out these silos don’t stop at education—they shape how mining companies operate. Here’s what you shared: ✅ Geologists model resources but often miss downstream mining and processing needs. ✅ Mine engineers focus on moving tonnes but don’t always consider processing constraints. ✅ Metallurgists optimize recovery but lack insight into ore variability, setting them up to fail. But siloed KPIs hurt operations. Mining succeeds by maximizing metal recovery and throughput at the lowest cost. Yet, companies break this into departmental KPIs that reward local efficiency at the expense of overall performance. Here’s how that plays out: 📍Mining teams hit targets by extracting more tonnes—whether the plant can process them or not. ⚡Processing teams cut energy costs, even if it reduces throughput and recovery. 🔧 Maintenance minimizes downtime but defers repairs, leading to bigger failures later. 💸 Procurement buys the cheapest equipment, causing breakdowns and lost productivity. Each team hits its targets—while the mine falls short. Why does this happen? Company culture. Organizations set siloed KPIs because they manage operations in silos—separating budgets, encouraging competition instead of collaboration, and rewarding local wins over profitability. And they ignore one critical principle: 👉 Culture eats strategy for breakfast. Success depends on aligning incentives so every team works toward the same goal. This is where value-chain thinking matters. Mining must align every step of the process, from geology to the final product. ✅ Geologists must provide data that mining and processing teams can act on. ✅ Mine engineers must optimize feed prep for plant performance. ✅ Metallurgists must balance smelter requirements with environmental goals. This isn’t new—it’s Follow the Money 101. Yet teams optimize for their own success, not the mine’s profitability. The result? ❌ Poor communication disguised as “alignment meetings” that fail to drive real change.  ❌ Departmental KPIs that create trade-offs rather than shared wins.  ❌ Budgets that encourage departments to hoard resources instead of collaborating. How do we break free from siloed thinking? 1️⃣ Align KPIs with overall performance. ✅ Measure teams by their contribution to mine-wide success. ✅ Reward mining teams for delivering the right ore, not just more ore. 2️⃣ Break down budget silos. ✅ If cost savings in one area increase costs elsewhere, it’s a hidden expense. ✅ Empower managers to spend where it actually delivers results. 3️⃣ Build cross-functional teams. ✅ Use shared KPIs that require collaboration. ✅ Get geologists, engineers, and metallurgists aligned before problems arise. Until leaders fix this, the mine will keep falling short. What do you think? Let’s discuss.

FP&A people waste time on: • Formatting reports to look appealing • Debugging error-prone Excel macros • Compiling data from outdated systems • Troubleshooting complex Excel formulas • Responding to low-value ad-hoc requests • Creating static presentations for executives • Chasing department heads for budget inputs • Managing version control across multiple files • Manually entering repetitive data in spreadsheets • Reconciling conflicting numbers from various sources FP&A people must focus on: • Using predictive analytics to forecast trends • Automating routine tasks to focus on analysis • Identifying key drivers of business performance • Implementing rolling forecasts for agile planning • Modeling scenarios to guide strategic decisions • Streamlining the budgeting and planning process • Building dynamic dashboards for real-time insights • Evaluating M&A opportunities and financial impacts • Collaborating with business partners on growth strategies • Conducting variance analysis to improve forecasting accuracy Successful FP&A teams blend financial expertise with technology. They adopt tools that are: - Easy for the team to use - Secure and compliant with data governance - Able to integrate with existing data sources - Focused on automating processes and saving time - Scalable for future business growth - Enhancing cross-functional collaboration FP&A must use new tools and focus on high-value tasks. It's time to change from number crunchers to strategic partners. P.S. Hi, I’m Erik Lidman! I have spent 25 years of my life working in the FP&A, EPM, and CPM spaces. I share daily FP&A tips and talk about finance trends and doing FP&A within Power BI using Aimplan.

How we saved 10+ hours weekly by giving finance a simple interface. Our finance team was processing invoices the same way for years: 1. Email attachments → 2. Manual download → 3. Print → 4. Physical signature → 5. Scan → 6. Manual data entry The entire cycle took 3-5 days. The request to "build a proper approval system" kept getting deprioritized—it felt like a multi-month project. We reframed the problem: We didn't need a complex system. We just needed to connect two things: the data from our accounting software's API and a simple list where the right people could click "Approve" or "Reject." What actually got built: • A single-page app that pulls unpaid invoices automatically • Logic that routes invoices over $5k to directors, others to managers • A comment field for rejections • A basic audit log showing who approved what and when What changed: ✅ Approvals now happen in under 24 hours ✅ The finance team stopped chasing paper trails ✅ Vendors get paid faster ✅ Every decision is logged automatically The takeaway: Sometimes "digital transformation" isn't about big platforms. It's about giving a team one less PDF to manage by building a simple, focused tool that sits on top of the data they already use. What's the most stubborn, repetitive task in your team's workflow? Often the highest-impact tools are the smallest ones that remove a single point of friction. https://uibakery.io/ #ProcessAutomation #FinanceTech #OperationalEfficiency #DigitalTransformation

Many in the industry believe that cutting expenses at every turn is the best way to improve efficiency. The common approach? - Hiring the cheapest vendors to save money - Addressing only immediate issues instead of long-term planning - Viewing upkeep as just another unavoidable expense But the reality is quite different. This mindset often leads to: - Poor service quality and frequent delays - Higher long-term costs due to constant repairs and inefficiencies - Increased resident complaints and lower retention rates The most successful operators take a different approach: - Build strong vendor partnerships based on quality and reliability - Implement proactive strategies to prevent costly emergencies - Recognize maintenance as a profit-driving function, not just a budget line item A well-structured plan is not just about keeping things running—it’s a key driver of revenue, efficiency, and asset value. Are your current practices setting you up for long-term success or creating bigger challenges down the road? Let’s connect to discuss strategies that enhance efficiency, improve resident satisfaction, and maximize asset performance. #RealEstateInvesting #FacilitiesManagement #PropertyOperations #MultifamilyLeadership #AssetOptimization

Instant Payments Will Disrupt End-to-End Enterprise Capabilities 💡 🔹 Channels and product management:  Instant payments will significantly affect channel services and product management. Notably, the support for direct debits and collection products will have a major impact, along with their associated sub-services like mandate management. Transaction notifications will also be affected, with potential changes in the type, timing within the flow, and medium as mandated by the specific instant payment scheme. 🔹 Payment instruction services:  Banks that adopt instant payments will require adjustments to Payment instruction services that assemble and verify payment instructions from bank customers and third-party providers. Message parsing services must be updated to handle the unique messaging format used by these schemes. 🔹 Payment release services:  Traditional payment systems often experience a delay between initiation and settlement, allowing time for funds verification and balance updates. However, because instant payments clear and settle in real-time, online balances must reflect these near-instantaneous transactions. 🔹 Payment order services:  Connecting to the new market infrastructure and clearing and settlement mechanism specific to instant payments will be crucial for sending and receiving real-time transactions. Ensuring compliance with the unique message identification formats mandated by each instant payment scheme is essential for smooth processing. 🔹 Payment operations:  The adoption of instant payments will significantly impact payment operation services which include customer support services and monitor and control services. The ability to automatically repair basic payment instruction errors may become less reliable for customer support because instant payment formats and validation rules differ from traditional systems. Customer identification and account validation processes may need adjustments. 🔹 Risk support services:  Instant payments will impact risk support services as exponential transaction volume growth strains existing transactional archiving systems. Systems that store traditional payment process data may struggle with instant payments' volume and potentially different data structures. The rapid settlement times and distinctive characteristics of instant payment systems necessitate adjustments to AML applications and compliance reporting processes. 🔹 Billing and financial services:  Billing services will handle new instant payment products, including supporting features like direct debits and collection products, which may have different billing structures from traditional payments. Some instant payment schemes also restrict the maximum fees processing banks charge, necessitating adjustments to existing billing models. Source: Capgemini - https://lnkd.in/eDxsrFUv #Fintech #Banking #OpenBanking #OpenFinance #API #FinancialServices #Payments #InstantPayments #Operations #Billing #Compliance  

ISO 20022: Moving Beyond Compliance to Commercial Opportunity The payments industry has spent years preparing for the ISO 20022 migration, treating it as a demanding compliance exercise. But now, with adoption well underway, the conversation is shifting: How can banks, fintechs, and corporates turn ISO 20022 from a regulatory requirement into a strategic advantage? The answer lies in data—structured, enriched, and ready to power new opportunities in payments, liquidity management, and customer experience. 1. From Compliance to Competitive Advantage ISO 20022 introduces richer, more structured data, but the real value comes from how financial institutions use it. The shift from compliance to opportunity means: i. Providing enhanced transaction insights for corporate clients, helping them with reconciliation, liquidity planning, and forecasting. ii. Using structured data for better fraud detection and financial crime monitoring, improving compliance efficiency and reducing false positives. iii. Driving real-time automation in payments and treasury operations, reducing friction and delays. iv. Financial institutions that see ISO 20022 as a data asset rather than a regulatory burden will gain a significant edge. 2. Monetizing Payments Data: Structured payments data can be transformed into valuable products and services: i. Advanced Analytics & Reporting – Providing businesses with richer insights on cash flow, working capital, and payment behaviours. ii. APIs & Embedded Finance – Enabling fintechs and ERPs to integrate structured payment data for better automation and decision-making. iii. Data-as-a-Service (DaaS) – Offering financial intelligence based on payment purpose codes, remittance information, and transaction trends. 3. Cross-Border Payments, CBDC, and the Future of Settlement i. ISO 20022 + CBDCs – As digital currencies emerge; structured payment data will be crucial for interoperability between traditional RTGS systems and new forms of money. ii. Instant & Frictionless Payments – ISO 20022 enables better interoperability across schemes like SWIFT gpi Instant, SEPA Instant, and domestic real-time payment systems. iii. AI & Data Transformation – Machine learning and NLP (like in Nucleus) can convert unstructured payment messages into structured formats for cross-border and trade finance applications. https://lnkd.in/gw-9uqVv 4. Instant Payments & Open Finance i. Bridging ISO 20022 & Open Banking – Richer data opens the door to real-time cash flow forecasting, automated invoicing, and personalized financial services. ii.  B2B Payment Innovation – Structured payments data will fuel smarter supply chain finance, embedded B2B payments, and real-time treasury solutions. Know more: https://lnkd.in/gWtbtQnJ https://lnkd.in/gjx2_z4i #payments #banking #iso20022 #data #swift #treasury

𝐓𝐚𝐭𝐚 𝐌𝐨𝐭𝐨𝐫𝐬 𝐥𝐨𝐬𝐭 𝐦𝐨𝐧𝐞𝐲 𝐟𝐨𝐫 𝐲𝐞𝐚𝐫𝐬. 𝐓𝐡𝐞𝐧 𝐭𝐡𝐞𝐲 𝐝𝐢𝐝 𝟑 𝐭𝐡𝐢𝐧𝐠𝐬 𝐝𝐢𝐟𝐟𝐞𝐫𝐞𝐧𝐭𝐥𝐲 𝐚𝐧𝐝 𝐩𝐨𝐬𝐭𝐞𝐝 𝐭𝐡𝐞 𝐡𝐢𝐠𝐡𝐞𝐬𝐭-𝐞𝐯𝐞𝐫 𝐩𝐫𝐨𝐟𝐢𝐭 𝐢𝐧 𝐜𝐨𝐦𝐩𝐚𝐧𝐲 𝐡𝐢𝐬𝐭𝐨𝐫𝐲. Most founders think profitability is a revenue problem. Tata Motors proved it's an architecture problem. FY25: Record revenue of ₹4.39 lakh crore. Highest-ever PBT of ₹34,300 crore. Net profit ₹28,100 crore. And the automotive business turned debt-free – after carrying peak net debt of ₹63,000 crore just four years ago. Here's the framework behind that turnaround: 𝟎𝟏. 𝐂𝐮𝐭 𝐭𝐡𝐞 𝐜𝐨𝐬𝐭 𝐬𝐭𝐫𝐮𝐜𝐭𝐮𝐫𝐞 𝐛𝐞𝐟𝐨𝐫𝐞 𝐜𝐮𝐭𝐭𝐢𝐧𝐠 𝐩𝐫𝐢𝐜𝐞𝐬 JLR didn't discount its way back. It reduced material costs, lowered depreciation, and cut interest outflows systematically. Margin improvement came from discipline – not volume. → Before your next pricing call, audit your cost architecture. Every 1% saved in cost is worth more than 3% gained in revenue at thin margins. 𝟎𝟐. 𝐃𝐞𝐛𝐭 𝐢𝐬 𝐚 𝐬𝐭𝐫𝐚𝐭𝐞𝐠𝐲 𝐩𝐫𝐨𝐛𝐥𝐞𝐦, 𝐧𝐨𝐭 𝐣𝐮𝐬𝐭 𝐚 𝐟𝐢𝐧𝐚𝐧𝐜𝐞 𝐩𝐫𝐨𝐛𝐥𝐞𝐦 ₹63,000 crore in net debt → net cash positive in 4 years. That shift didn't happen by accident. Free cash flow discipline and capex prioritisation drove it. → Map your cash conversion cycle monthly. Know exactly how long money stays stuck in your business. Faster cycles beat bigger revenues every time. 𝟎𝟑. 𝐃𝐞𝐦𝐞𝐫𝐠𝐞 𝐭𝐨 𝐮𝐧𝐥𝐨𝐜𝐤 𝐟𝐨𝐜𝐮𝐬 Tata Motors approved the demerger of its CV and PV businesses into separate listed entities – so each segment gets dedicated capital, leadership and accountability. Complexity was hiding profitability. → If your business has two very different customer profiles, cost structures or growth rates under one roof – you're probably subsidising one with the other. Separate P&Ls reveal the truth faster than any consultant will. Profitability isn't found. It's engineered – one decision at a time. #tatamotors #tatagroup #founders #business #profitability #turnaround

There are two non-negotiables in accounting: the books must be correct, and they must be ready on time. For decades, companies have satisfied those constraints through an extraordinary amount of manual effort. Highly trained professionals code transactions, re-approve familiar expenses, reconcile mismatches after the fact, and compress all of it into the ritual of month-end close. It works. But it is fundamentally retrospective. Today, Ramp introduced an Accounting Agent designed around a different premise: what if bookkeeping happened as the business operated, rather than after it? The agent captures, codes, reviews, validates, accrues, and reconciles spend continuously. It learns directly from the people who understand the nuances best, the accounting team itself, and applies that context in real time. At Perplexity, where velocity is core to the company’s identity, this allowed their team to stop choosing between speed and accuracy. The majority of transactions are now coded automatically and audit-ready, enabling close to start on day one instead of day thirty. What’s been most striking is how the system learns the subtle, company-specific logic that historically lived only in human judgment. As Jim Romano, CFO at Stateside Brands, described it, the agent is already identifying patterns like when spend belongs in samples rather than travel and entertainment — the kinds of decisions that typically require institutional memory. As he put it, the goal is simple: finance teams should focus on exceptions, not the easy stuff. We’re also seeing the second-order effects emerge quickly. Teams report spending dramatically less time reviewing transactions and substantially more time on planning, analysis, and growth. As one CFO told us, “What used to take hours of manual review now happens. I’m spending nearly all of my time thinking about where the business should go, not retracing where it’s already been.” There is a broader shift underway in accounting. The central question is moving from “what parts of close can be automated?” to “should close even be an event at all?” One belief that guides our work at Ramp is that information latency inside companies is an invisible tax. When financial truth lags behind operational reality, organizations make slower and often worse decisions. As transaction data becomes inherently digital and systems become capable of learning institutional context, continuous close stops being aspirational and starts becoming inevitable. One thing that surprised us while building this: accounting isn’t constrained by a lack of rules — it’s constrained by how many of those rules are unwritten. Seeing software begin to absorb and apply that tacit knowledge has been a clear signal that accounting is entering a new phase. Accounting has always been the record for business reality. Our goal is to help it become closer to real-time truth. Proud of the team, and grateful to the customers building this alongside us.