To thrive and grow in an environment of disruption and instability, organizations are finding they need to accelerate the pace of digital transformation to stay relevant. And the transformation of digital finance is the key to this success. Successful digital transformation means redefining the roles of finance managers and their teams, and unleashing their full potential with new digital tools.
With digital transformation comes huge opportunities. For successful transformation, consider these eight key steps.
Start with a roadmap
The first step in digital finance transformation is to map your processes and transformation journey in detail. This includes mapping the gap between where you are now and where you want to be. So take into account the current processes and the procedures and software that need to be changed. Also consider the new ways of working required and the people involved. You need to understand what your goals and objectives are, as well as the issues and pressure points, and develop strategies that are clear and communicated to everyone and that support the vision of the organization.
James Miln, ACMA, CGMA, senior vice president of finance and investor relations at Yelp, the U.S. business review and social networking platform, said a roadmap provides the vision, which enables to clarify from the first day the required exit objectives. He explained: “Understand the strategy. Think bigger. Where do we want to go and what people do we need, with what skills?
“In parallel, think about what can be done to optimize the process. And then think about which tool and which solution can help facilitate,” he added.
Create a digital Culture
Successful digital transformation requires a structured and integrated approach — and people are at the center. Start in one area of the business to achieve transformation success, and then you can scale it across the organization. This will provide an environment to build engagement, establish internal champions, enable quick wins, and showcase early successes.
Think about what is communicated in these teams. How will you engage with them? How do you show them that this change is for the best, that it’s a good thing? What’s in it for them? For example, employees can learn new skills, which will allow them to be more efficient and effective in their work, and thus they will have more or new opportunities to grow, contribute and innovate. It can also save time, create value and provide a better quality of life.
“It’s not just about picking a system and implementing it. It’s about changing the culture of your finance team to operate in a different way. That’s the exciting and transformational part “said chartered accountant Andrea Harrison, head of financial transformation at the Coventry Building Society. , the UK’s second largest construction mutual society.
Build strong processes
Processes need to be streamlined, with everyone involved agreeing where and how technology should work throughout the transformation. Processes must also support strategies and be agile and efficient. For example, when building an HR management platform, the first step should be to standardize jobs – to make sure you are left with only the jobs you need. This avoids “dematerializing waste”.
“Adopt, don’t adapt. Continually challenge yourself to find out why out-of-the-box processes and reports won’t work. Understand your pain points and make sure new ways of working address them,” said said Harrison, who is leading a multi-million pound program to transform the Coventry Building Society’s finance and treasury functions.
Make data analysis a standard practice
Finance should have access to real-time data as it enables decision-making and identifies where value can be added.
Miln said accounting and finance professionals can add value by possessing data analytics well beyond the financial books. “We need to think about how our skills as financiers can help us get better data and insights about the business to guide decision-making,” he said.
learn from others
Employees should be provided with learning resources and time for professional development. Train each staff member and show them what to do. Also tap into the skills and experience of an extensive network of leaders and staff at all levels.
Adopt a continuous improvement mindset to take advantage of the opportunities offered by technology. “We need to be open to learning from others, but we can also teach others how transformation combines to drive value for the organization,” Miln said.
Develop cloud-based tools
Harrison said the Coventry Building Society has implemented a cloud-based reporting tool for the 2021 year-end reports. “We estimate that we saved over 1,200 hours of effort over an eight weeks. It relieved significant time pressures,” she said.
“It has been great for the well-being of colleagues and the development of the team. [The tool] will also enable us to bring forward the announcement of our results and the publication of the full annual report and accounts in the future.”
Moving to cloud technology can reduce system complexity and costs. It also makes it easier to update to new software versions.
Likewise, it is important to invest in automation of controls and to eliminate manual spreadsheets and the risk that comes with them. Consider self-service reporting and use intuitive, easy-to-understand data points that will empower customers with basic data.
Systems must also have the ability to integrate and connect – for example, it is impractical to have a financial system that is not linked to the system that supports procurement.
Creating a digital culture fosters collaboration with others, and giving voice to all participants is essential. Include all the required parts from the start, so that they are part of the trip. Engage senior executives and business owners from the earliest stages, then work on the functions you need, such as accounts payable.
At Coventry Building Society, Harrison blended generations of employees within teams to achieve the best results, including long-serving staff with 30 years of service and in-house graduate program graduates with different perspectives. “It’s about getting the balance and having a rounded debate. It’s really important to have the mix so everyone has a voice,” she explained.
IT teams can include a mix of data scientists, engineers, and business analysts. It helps to tap into the knowledge of tech-savvy junior analysts.
It is important to collaborate with teams and colleagues in areas such as procurement and HR, to redesign processes and ensure they are as seamless as possible. Lean Six Sigma training creates opportunities for continuous improvement mindsets and culture throughout the business.
Take an iterative approach
Adopting new technologies and digitizing an organization requires an iterative approach. Learning from improvements at each stage can ensure that digital transformation is optimized.
Miln explained, “Because digital transformation is an iterative process, finance leaders have to come back to it again and again. It’s part of the job. That’s why it needs to become a core competency.
“It has to be something that is part of what finance does today, just as we are continually improving or refining accounting principles. It should be the same thing,” Miln suggested.
“It’s exciting for finance because the core skills we have as accountants are very valuable. Combining them with analytical insights, storytelling and strategic mindsets will help us evolve beyond the CFO to the director of value,” he added.
— Miti Ampoma is a Senior Content Writer with the Association of International Certified Professional Accountants, representing the AICPA and CIMA. To comment on this article or suggest an idea for another article, contact Oliver Rowe at Oliver.Rowe@aicpa-cima.com.
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