CONTENT FROM: | JANUARY 30, 2023
In challenging macro environments, process improvements that power strategic capital allocation are becoming increasingly important.
Richard Cheung, CFO at the world’s first 3D robotics supply chain company Attabotics, told PYMNTS that for his business, “the new challenge now is capital allocation — it’s extremely important to understand where we should continue to invest, where we throttle back spend, and how do we continue to evolve by leveraging better technologies, how can we achieve the optimal return on our investments.”
Coming off a successful fundraise in November of last year, Cheung added: “We have the cash — now it’s execution time.”
PYMNTS’ research shows that as organizations look to update their in-house operations using years of pandemic and post-pandemic data to inform their decisions, there are meaningful shifts in investment priorities based on business-specific cash flow, working capital and liquidity strategies.
“[Attabotics is] balancing revenue growth with business profitability and ways we can quickly scale the business while preserving cash,” Cheung said.
“The big thing for me is achieving cost reductions,” Cheung added. “We’ve established product market fit, now how do we give it to our customers at a price point that makes sense?”
Realizing Operational Efficiencies
Cheung told PYMNTS that Attabotics’ robotic warehousing solution, which offers legacy fulfilment centered around an all-in-one automated order-picking system, can reduce warehouse footprints by up to 85%, allowing businesses to ship their goods from convenient locations placed much closer to high-density urban areas than was previously feasible.
One of his goals as CFO is to realize that same caliber of operational enhancement across Attabotics’ own working processes.
“We live in a world that is constantly in motion,” Cheung said. “Not only does Attabotics deploy state of the art hardware, software and artificial intelligence to power our customer solutions, we have started to evolve and modernize the back-office accounting systems to become a true enterprise resource planning (ERP) system that considers the needs of the manufacturing and operations teams.”
He added that by leveraging next generation technology such as bar code scanners combined with bar coded stations, Attabotics can pinpoint inventory movement in real time, enhancing the ERP system to become more predictive of future inventory needs based on sales pipelines. This allows the company, as well as its clients, to maximize for cash flow by optimizing the balance between carrying inventory on-hand versus pre-ordering longer lead time items.
“Previously the ERP system was more of an accounting system, but now we’ve really transformed it into something we can leverage to run our facilities really efficiently, and use to control our costs,” Cheung told PYMNTS. “The next step we’re taking is embedding all our systems, that information that’s being generated, into the ERP system so that it is a one-stop-shop for us and for our partners.”
PYMNTS has been closely tracking the evolving role of the CFO as increasingly being responsible for taking the lead on holistic business planning, something Cheung has noticed as well.
“We’re kind of the glue that sees every division,” he said.
Digital Transformation Enables Knowledge Sharing
Behind the transformation of the CFO role is an increasingly potent suite of modern solutions and digital tools for finance teams that simultaneously help deliver value for business partners and customers.
“Our hardware is state of the art,” Cheung said. “But our software is catching up really quickly too, and that’s allowing us to give our clients a lot more information and data that the CFO on the other side can act on. If, for example, they’re running an organization at scale and have a hundred thousand SKUs, they’d want to know which ones are moving faster than others, or what a typical order-picking basket would look like, and we can provide that data for them, which is very valuable.”
Previously, Cheung said, finance professionals and CFOs were very reliant on manual processes, or what he calls “the cabinet filing storage system.”
Modern and flexible operational foundations help businesses respond to challenges in real-time and offer tailored enhancements to processes that may have historically been plagued by bottlenecks.
“Another area of focus [for Attabotics] is moving away from manual time tracking in excel to using our time management module in our payroll system,” Cheung said.
“When fully implemented, this will allow our customer-facing teams to record their time spent on customer initiatives into our payroll platform, which will export these costs for each group such as client operations, field services, etc., into our ERP system,” he added. “This will accurately track time and allow business leaders to manage our labor costs for each customer and ultimately drive efficiency and profitability for each site.”
As for what the Attabotics CFO is most excited about looking ahead?
“We’re really at the start of something amazing,” he said. “We have really good and innovative technologies, we have a great competitive advantage, and we have a robust patent portfolio that protects our IP — so I’m just really excited to see how all these process improvements can help us run the business.”
Read the entire article here: https://www.pymnts.com/spend-management/2023/cfos-prioritize-cash-flow-procurement-systems-upgrades/