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Finance transformation in the property sector – top ten tips for success


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10 July 2012: With Australia’s property industry facing a range of sector-specific and broader national and global challenges, there is significant demand for better financial forecasting, more meaningful performance insights and better capital management.

Yet the finance function in the sector has struggled to meet these demands.

A number of players have seen the light and transformed (or are in the process of transforming) their core finance reporting systems and processes to reduce costs and better inform strategy development, decision-making and operational effectiveness.

The benefits of a successful transformation can include:

  • Improved growth through faster leasing and increased occupancy rates
  • Standardised leasing processes
  • Reduced operating costs
  • Improved product innovation
  • Supply chain cost savings
  • Better risk management
  • Improved management information efficiency.

To help with what can be a major investment and complex process, professional services firm Deloitte has released Top ten tips for transforming your property finance function, a guide to help CFOs and finance executives in the property sector scope, design and implement transformational change.

Deloitte Consulting Partner and leader of the Asia Pacific Finance and Performance Management group and its member firm practices, Donal Graham, said finance transformation had to be a key consideration for the industry.

“Property companies are often complex, operating across a range of areas including construction, development, senior living and funds management, and having a contemporary and flexible finance function in place is absolutely critical,” he said.

“One implication from the GFC was that a number of property companies were found wanting when it came to having to quickly produce financial information to better inform management, and third parties such as banks.

“Flexibility and speed when it comes to planning, budgeting, forecasting, reporting and strategy development are more important than ever, but the property industry has historically underinvested in financial management systems and capabilities.

“Businesses that haven’t gone through finance function transformation are really missing out on what can be very significant efficiency improvements in the order of 20-30% as well as access to vastly superior information and insights that can deliver real competitive advantage.”  

Deloitte’s Top ten tips guide covers the breadth and depth of a finance transformation project – from benchmarking current practices and determining the optimal finance model for an organisation, to engaging business stakeholders and focusing on the people impacts.

National Leader of Deloitte’s Real Estate industry practice, Ian Breedon, said the guide drew from the hard-learned experience and hard-earned success of Deloitte and its clients.

“Finance is a service delivery business across every sector, and transforming this vital function to better support business needs will deliver lasting benefits,” he said.

“The challenges might vary, but, major companies in the property sector should take a fresh look at their finance operations and assess how systems change and business model and market changes are driving new demands on the finance function.

“This is an investment the sector needs to make and, if an organisation gets the design and implementation right, it is an investment it won’t regret.”

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Contacts

Name:
Simon Rushton
Company:
Deloitte
Job Title:
Corporate Affairs and Communications
Phone:
Tel: +61 2 9322 5562
Email
srushton@deloitte.com.au
Name:
Donal Graham
Company:
Deloitte Australia
Job Title:
Partner, Consulting
Phone:
Tel: +61 2 9322 7279
Email
dgraham@deloitte.com.au

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