Back-office operations refer to the departments within finance companies that are run by administrative, accounting, and technical support staff. These employees do not interact with the corporate enterprises’ customers directly. However, they perform a wide range of services essential for the functioning of companies’ businesses. These include proper maintenance of financial records, regulatory compliance, hiring new recruits, and IT services. They play an important role in ensuring the smooth conduct of the corporate enterprises’ commercial operations as well.
Scott Tominaga is an investment expert from America with more than 25 years of valuable experience in the field. He specializes in many diverse areas like back-office operations, accounting, financial compliance, administrative functions, and hedge fund investing. He has a FINRA regulation and holds a finance degree from Arizona State University. Currently, he is the Chief Operating Officer of PartnersAdmin LLC in the USA.
He says the smooth running of back-office departments is vital for the success of all financial service companies. Employees discharging their responsibilities in these departments might not generate revenue, unlike their front-office colleagues. However, the service they render is essential in boosting the internal productivity of these corporate enterprises. They maintain, manage and ensure the security of the vital business data financial companies depend on. This helps the corporate enterprises continue conducting their lending and investment activities in the market without any difficulties.
How do the functions of back-office employees support their front-office colleagues?
Back-office employees provide ongoing valuable support to their front-office sales and marketing colleagues in the following ways:
- Resolve customer complaints and highlight their compliments on the companies’ social media platforms,
- Collect money on the customers’ outstanding invoices in a timely manner,
- Ensure the proper functioning of IT infrastructure connecting the companies to the customers and investors,
- Monitor the business expenses and maintain a steady cash flow to avoid financial difficulties,
- Ensure proper compliance with statutory financial regulations and customer privacy laws, and
- Ensure timely payment of the companies’ taxes and other statutory expenses to avert legal complications.
Tips to streamline back-office operations
Finance companies find conducting back-office operations to be costly. Many of them might notice their employees depend on obsolete processes and systems to perform their duties. As a consequence, these corporate enterprises might be looking for ways to streamline their back-office operations. They should consider implementing the following tips:
- Replace obsolete manual data-entry processes with the latest office automation, EDI and ERP software platforms,
- Invest in training back-office employees on the use of new industry-based techniques to performing their duties, and
- Introduce incentive schemes to motivate employees performing back-office operations to become more efficient in their jobs.
Scott Tominaga concludes by saying streamlining back-office operations is critical in enabling financial companies to smoothly conduct their businesses. The activities even make it easier for front-office employees facing customers to perform their duties diligently. The corporate enterprise can improve the efficiency of their back-office operations in automation, investments in employee training, or the introduction of incentive schemes. However, the companies should carefully scrutinize the cost-benefit analysis of whatever measures they adopt. Only then can they get the desired results and expand as desired in the market.