Agile Transformation in Financial Departments
The goal of every finance department should be to reach agile transformation. It will not only help the company grow, but it will render the processes much easier. According to a case study in Agile Transformation, USPTO Company revised their processes with the aim of increasing its efficiency, and the quality of products and services. With what results? The company has significantly increased its effectiveness thus increasing the alignment between its business and IT strategies. Their Center of Excellence is now fully functional and independent. How can you as a financial manager launch the financial agility? Let us explore several ways.
According to the blinklane website there are four ways to launch financial agility:
1. Train your people
Real people run every financial system. These professionals need to be aware of the implications of agile transformation on the financial processes. It is therefore vital to openly discuss basic agile values such as responding to change over following a plan or individuals over processes and tools. Your teammates will be eager to apply changes once they fully grasp them.
2. Show the benefits
Relying on the business-as-usual form, the finance function is no longer viable if you want to become a truly agile organization. Think: might the new processes simplify their administration? Can we reduce manual data processing by linking to an agile project management tool? What kind of new data could we use to make better investment decisions? Such questions will help you focus on what benefits to show.
3. Simplify and visualize
Say you want to change accounting approach in your company. It can be a big challenge and your employees will often say that “such a thing is not possible in our organization” or that “they are different”. People easily become doubters.
Daniela Pleiner, mentions this example: “Venture Capitalists aim for a diverse portfolio that fits their strategy, they mostly invest in teams they believe in and have frequent feedback loops where the startups can demonstrate their value. In other words, Venture Capitalists are planting a seed, but even if they can’t harvest the fruits yet (e.g. to see direct revenues), they do not cut the water.“
What will help in such a situation is to simplify the complex processes and visualize alternatives. Seeing is believing here.
4. Be realistic
It would be very difficult to turn long-established financial processes around in a few weeks. It would be very hard to achieve it in a few months too. Bravely challenging the status quo and making small steps here and there is the way! Remember that the goal is not to disrupt all the financial processes within your company. Rather it is vital that finance has a constructive role to play in supporting the business to be more effective.
Why adapting an agile operating model is crucial for your organization?
Many companies today still follow the old fashioned and traditional operating model. In this model, finance professionals support specific areas of the business while, at the same time, focusing on management reporting, budgeting and planning, occasional ad hoc analysis. Finance staff working in this way will rarely have time to step away from their unit-specific tasks and help shape financial strategy for the business overall.
What is more, the structure often keeps the organization from responding quickly when market forces require the business to change. Agile operating model is what the finance organizations needs. Deep business model would still be important, but employees of the financial department should be able to serve as knowledge integrators – sharing information from multiple sources inside and outside the finance function,“ reports McKinsey.
Would you like to discover more about financial agility in the finance department and the role of Controllers? Come visit our conference Financial Controlling Toolbox 2019 on September 25-26, 2019 in DoubleTree by Hilton Hotel Bratislava. Earn 14 CPD points, gain inspiration and learn from the best. For more information check out controllingtoolbox.com