The burgeoning world of FinTech has provided businesses with countless new opportunities for improving their processes. Even among this crowded and innovative field, few FinTech tools have proven to be as effective as the cloud-based Xero accounting software, whether businesses are using it to better manage their cash flow, or taking full advantage of its remote working opportunities to connect accountants in London with teams based on the other side of the country.
That’s not all there is to Xero, however – it can also be used for KPIs and measuring the success of your business. Too few businesses fully utilise this element of the technology, so here’s how it can be used in a way that gives your business a competitive advantage – especially when you have the added input of a trusted advisor.
The Importance of KPIs
Your Key Performance Indicators (KPIs) are the measurable values that show how well your business is hitting its targets, and as such they play a pivotal role in driving the growth and success of your business. Naturally, they’ll be different for every organisation, but whether you’re measuring debt/equity ratio or gross profit percentage, they should ideally be viewed as individual elements that make up the whole of your business. Only with this holistic view of your KPIs will you be able to develop a complete understanding of where your business stands, and what needs to be improved to ensure that you hit the targets that are your guide towards success.
Measuring Your KPIs With Xero
That’s why the most effective way of using Xero is to customise it to your business. Make sure you’re only using the features you need by integrating it with the tools that are relevant to your setup and structure. This will help to ensure that you’re accessing the KPIs that matter to your business. It’s important to identify the KPIs that need to be focused on, so that you can make sure Xero is only looking at the factors it needs to, thereby reducing waste.
Using Xero, you can carry out the in-depth analysis that will enable you to measure your KPIs, to determine whether you’re on target or not. It is also worth considering customising Xero with the optional add-on tool Spotlight Reporting – which can transform the data you gather into visual performance reports so that you can convey your current situation to any party that you need to, regardless of their familiarity with bookkeeping.
The Benefits of a Trusted Advisor
Xero has made things easier for business, but the input of a human expert can still be of huge benefit. No FinTech tool can entirely remove the need for a human touch, and the leader of any business needs to be sure that all of their processes are being handled by someone with the right knowledge and expertise. Integrating your current systems with new technologies requires a significant level of specialist knowledge. Fortunately, Xero runs a partner programme that sees them combining their own expertise with that of other relevant organisations, such as the accountants and business advisors at Dua& Co.
Whether you’re considering installing Xero software at your business, or a current user looking to maximise its potential, using it to measure and report on your KPIs is an effective method of streamlining and improving your performance.