The Path to Greater Efficiency for Canada’s Financial Leaders

Earlier this year, the Bank of Canada noted the urgent need to raise the country’s productivity levels. Improving productivity through efficiency could help our economy grow faster and reduce the risk of inflation. Encouragingly, this is an achievable scenario.

The Canadian market is full of technology that can help companies work smarter, optimize workflows, and achieve business goals. The adoption of innovation is especially noticeable among finance leaders who want to integrate new tools to increase efficiency. Here are some steps Canadian companies can implement in their finance teams to increase their results.

Consolidation for efficiency

In recent years, finance teams have been inundated with an explosion of SaaS vendors promising to improve efficiency in finance functions. Unfortunately, this exponential growth in the number of service providers has had the opposite effect, increasing complexity and ultimately slowing down decision-making for companies

While most companies need multiple systems to run their businesses, according to a recent Stripe report, finance leaders struggle with the sheer number of software applications they must manage on a daily basis. 63% of finance leaders said they struggle with inefficiencies when using more than 10 different back-office systems, and the problem is especially acute in enterprises, where nearly a quarter use more than 50 different systems.

Two-thirds (67%) of Canadian senior business leaders describe the cost of software licenses and subscriptions as somewhat or very difficult, prompting more companies to consolidate their software stack. As companies continue to grapple with economic uncertainty, they should favor vendors that allow them to centralize data and reporting, minimize human error, and close the books faster.

Automation with a human touch

Artificial intelligence (AI) is just one example of the new technology that many companies have added to their arsenal, with 87 percent of Canadian organizations (compared to 72 percent globally) already testing or using AI to automate their financial reporting process

Businesses are exploring how they can increase efficiency by automating everyday tasks. Finance teams are no exception, with investments in digital technology to automate parts of finance operations having increased. According to Stripe’s report, finance leaders will continue to place a heavy emphasis on human intervention, and we can expect to see executives devoting more time and attention to data analysis and strategic planning, building stronger internal partnerships between finance and business teams, and introducing new business models—all of which can have a significant impact on a company’s bottom line.

Businesses looking to save time on manual tasks can start by identifying the biggest sources of manual effort, such as legacy systems and spreadsheets, and then choose tools to automate some of that work. For example, businesses handling taxes in multiple markets can reduce complexity with tools like Stripe Tax, which automatically calculates and collects goods and services tax (GST), harmonized sales tax (HST), and other provincial taxes (PST and QST), saving significant time.

Strengthening against fraud and swindling

The adoption of new technologies means that fraud and scams have also become more sophisticated. According to a recent release from Statistics Canada, the number of fraud cases in Canada has almost doubled in the past ten years, skyrocketing from 79,000 in 2012 to 150,000 in 2022.

As e-commerce fraud becomes more sophisticated, so too must fraud detection and prevention measures. In 2024, companies must take a more strategic and multi-faceted approach to fraud prevention and increase investment in educating finance teams and the broader business on how to best detect and prevent fraud.

Again, leveraging the right technology can make all the difference, and businesses doing business online can use e-commerce fraud detection products to monitor transactions for signs of fraud, such as unusual spending patterns.

For example, Skip The Dishes, a leading Canadian food delivery chain, has seen tremendous growth in its industry, which has also increased fraud and compliance. The company implemented Stripe Radar, which uses machine learning to continuously adapt to changing fraud patterns tailored to SkipTheDishes’ unique business. Since switching to Stripe, they have reduced their chargeback costs by over 45% and provided their customers with a smoother payment experience.

Looking to the future

While it’s hard to predict what the second half of the year will look like from an economic perspective, 2024 is shaping up to be a pivotal year for finance teams. There’s still time to revisit your technology strategy, identify areas for efficiencies, and build a foundation for a strong future.

This will help teams achieve success, increase revenues and reduce costs, which will be crucial in surviving some tough economic times.

Matthew Burlak is the Canadian Head of GTM at Stripe.