Digital Technology Enablement and Automation Drive Measurable Outcomes
Digital world-class Finance and Record-to-Report organizations have been brave in defining and executing a vision of a future that fully harnesses digital era technology and maximizes automation. In the new world they are entering, Finance has the capacity and focus to be better able to take on higher-value activities and unleash the latent intelligence of the organization to deliver greater impact.
These organizations convert digital enablement and automation into tangible outcomes including improved adoption of best practices and enabling capabilities. In the areas of Record-to-Report efficiency, standardization and automation, digital world-class companies have achieved and sustained significant performance level advantages compared to the typical organization:
“It Feels Like I am Using a Sports Car to Pull a Caravan in a Storm…I Wish it Were Easier”
Talk to transformation leads focused on the accounting and reporting processes and they will nearly always express a desire to achieve automation and to go digital.
But, there are also the all too familiar tales of woe and frustration that world-class levels of automation are beyond their grasp. Transformation leaders often cite insufficient capacity, inadequate budgets, gaps in the right skills, and dealing with competing demands on time. A transformation leader described it as: “It is like we have access to a sports car but we are pulling a caravan of complexity.”
The implications: we are not likely to accelerate fast unless we put effort into taking weight (complexity) out of the caravan.
Finance Can Learn From the Digital Natives
Companies rarely start from a nice greenfield situation. Most organizations have been around for more than a few years and thus have legacies casting a shadow on their processes, making them more complex than they need to be. We cannot expect our company to be an Alphabet, AirBnB, Amazon or an Uber, but we can learn from them.
If we look at these digital natives, we can see they are conditioned to drive a global template approach at the onset that is lean, effective, and efficient, and where they only adapt to local needs if it is absolutely necessary. They lead with a global approach and the localization is an exception not the rule.
Aspirational Finance functions should follow that lead.
Digital world-class companies are robust in challenging their legacy decisions and investments. Put another way, they are brave enough to tackle their controllable complexity.
This approach is a digital world-class habit: they drive a global approach, accept necessary differences, and get mandates from the top.
They use all of this to prevent the tail from wagging the dog.
Finance Can Learn From the Digital Disruption of Recent Times
Process variation and unnecessary complexity are the enemy of automation. Finance and Record-to-Report organizations must attack this if they are to properly capitalize on the advantages of process automation and wider digital era technology investment(s):
- Better Customer Experience
- Better Co-Worker Experience
- Greater Efficiency and Productivity
- Improved Accuracy, Consistency and Completeness
- Tighter Control
- Faster Error Free Process
- Improved Data Analytics on Process Execution
The disruptions of recent times have caused many customer-facing processes to be impacted. New innovative multi-channel approaches have been created and new technologies have become commonplace.
These innovations leave a lasting impression on some really familiar processes.
A great example of this is when we now visit a restaurant. In many cases, the restaurant has gone digital. Traditionally, the smartphone in our pockets played a minor role: to book the restaurant and maybe at the payment of bill stage.
Typically, a large role was played by serving staff to facilitate activity: provide the menu, take the order, pass the order on to the kitchen/bar, deliver your order. If we visit a restaurant in the new normal, we may be asked to scan a QR code and we can straight away get the menu, order from our seat, repeat as required, and pay directly from our phone.
This is a better process that delivers all the benefits of automation listed above and removes frustrations we suffered in the prior process(es). For example, “Why have the waiters not noticed me trying to get their attention?” and “When will my food arrive? I have a pressing engagement after this.”
The key question for Finance is: Can we be braver in how we redefine our accounting processes with such amazing technology at our fingertips?
There are Risks of Remaining With the Status Quo
If processes are unnecessarily complex and varied, it is probable that they will be less tightly controlled and more prone to human error. This is a root cause of lower productivity that leads to a loss of both efficiency and effectiveness.
In such a scenario, it is likely smart people will be buried in mundane tedious work and the best will likely seek out opportunities to be removed from this environment.
There is a risk that companies will lose their best people if they do not address tedious, mundane and routine work.
Transformational Change Can be Achieved if Companies are More Brave
Finance leaders need to be willing to take some risks and show some bravery to thrive and be successful at driving automation and fusing digital era technology into processes.
Bravery involves executing on the 3 Bs: Backing, Boldness and Backbone.
- Backing: Gain approval from the Office of the CFO to drive a truly transformational standardization and automation agenda
- Boldness: Be willing to challenge the status quo and try out new technologies and techniques
- Backbone: Possess a strength of character and a relentless focus on tackling process variation and removing mundane manual activity
So, a final question: “What is stopping your organization from showing a bit of bravery and forging new processes that are digital and automated?”
Written by: Bill Marchionni, Account-to-Report Advisory Global Program Leader, The Hackett Group & Stephen Ferguson, Account-to-Report Advisory, EMEA Program Leader, The Hackett Group