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Everything you know about financial transformation is wrong

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First published on Business Reporter, October 5, 2020, by Steve Soter, Senior Director of Product Advertising and Accounting Business Principal, Workiva.

 

Financial transformation has been the talk of CFO roundtables for years – but why are so many sceptical about the subject?

I was enjoying lunch with a former colleague the other day, and eventually we hit the subject of financial transformation. (Thrilling, right? We finance folks know how to party.) His team started their initiative years ago, but despite long implementation cycles and millions of dollars, it still hadn’t come to fruition. He shrugged his shoulders, conceding that the only thing he was sure about was the unlikelihood of the project ever being done. Then he went back to something he could control: his salad.

My friend is not alone. One in four executives believe their transformation will never be completed. That’s because financial transformation is so vague, with so many interpretations, that it’s lost all meaning. By the time they’ve started down the transformation roadmap, CFOs feel like they’ve been sold a bill of goods, rather than a plan of action.

So, what’s standing in the way of that high-performing, highly automated, analytics-driven office of finance? Well, it starts with what’s wrong with financial transformation as it’s understood today.

It’s not just another high-priced technology investment

Financial transformation should not be synonymous with another giant capital expenditure. Large-scale, on-premises ERPs might have been associated with transformation at one time, but cloud advancements now rival their power – at a fraction of the cost. Plus, APIs and integrations have broken down barriers between systems of record and systems of work (you know, where all the accounting and reporting work actually gets done).

Pandemics are no excuse to slow down

If you were able to operate as usual during the pandemic, good for you – you were one of the lucky ones. Most were caught off guard, still relying on common software and disconnected systems from the dark ages. That made it a Herculean effort to meet deadlines, keep everyone on the same page, or even complete basic tasks. While the work got done (eventually), there was also a cost in human capital – with employees juggling work, school, and family, all coexisting in the same building.

Now the pandemic is serving as a catalyst of transformation, according to a PwC survey. Close to half of finance execs plan to make remote work permanent, and more than 40 per cent plan to accelerate automation and introduce new ways of working. Still, it seems like those numbers should be higher.

Transformation isn’t as costly as it sounds

While cost is always a concern, analysts at Gartner counter that successful transformations identify future business needs and the corresponding services finance will be able to deliver. On the other hand, unsuccessful transformations are only worried about hitting a cost target.

These finance services are the things we all dream of: more time for analysis and strategic thinking. Analysts are being paid a lot of money to tie up numbers and spin up pivot tables. Let them work their wonders on value-added activities instead.

It’s okay to start small

You hear “transformation” and immediately start thinking of massive change (and massive consultant hours). That’s a surefire way to raise eyebrows in the boardroom – and scare everyone in the office to boot. Iterative steps and focused solutions can cover a lot of ground quickly, without significant disruption to existing workflows. The right platforms can even do the hard work first – connecting your people, data, and processes anywhere and everywhere – and then expand into other areas.

For example, Deloitte’s Sandy Cockrell cited trying to improve the monthly financial close process: “It’s a one-time effort, but the benefits would repeat year after year. That one-time effort may require people or technology that is unique or new. And to get it done, it could require someone that you rent for a month or two that has specialised skills that can help you get it done.”

With your attention on bite-sized chunks – and while using solutions that foster connectivity – you can tackle that transformation in no time.

You can do this

Despite all the talk and money spent on financial transformation, there is a better way. Focusing more strategically on connected solutions that improve specific processes can save time, cost and future interruptions – be they pandemics or murder hornets. Moreover, you can advance your financial transformation once and for all, using connectivity as the foundation of your success.

For more on optimising a finance transformation program during a pandemic, consider these six recommendations from Gartner.

For the latest news and information, visit the Workiva Newsroom.

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Everything you know about financial transformation is wrong

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Steve Soter

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