Culture of Innovation

Exploring alternative sources of funding.

By Vikram Oza

Creating and developing a culture of innovation in an organization is of paramount importance for a finance leader. To stand out from the pack, one needs to nurture innovative ideas. And to achieve this, the finance leader should lead by example to show the team how to inculcate innovation in daily tasks.

In my opinion, there are two key areas in day-to-day working of the finance function that require an innovative approach. The first is raising finance and ensuring that liquidity is maintained at comfortable level throughout the organization. The second area of importance is to keep finance costs at a minimum while devising ways and means to continuously reduce them through various innovative techniques.

This is possible only if everybody in the team is involved. Set the goal and let your team come out with innovative ideas. Besides, encouraging brainstorming sessions within the team can bring many ideas to the fore. Implementing those ideas which are executable can result in what you had aimed for at the beginning of the exercise.

Let us take the first case of raising finance for an organization at a cheaper rate. One is for day-to-day funding of operations viz. working capital requirement; the other is funding for capital expenditure or Capex, which is used to meet expansion needs.