Finance Transformation: Making It Work
Motivating your company to embrace change. When your finance department reengineers its processes, it is important that employees are prepared for the changes--poorly planned financial transformation programs hurt employee morale and production. To be successful, the CPAs in charge of quality improvements, such as controllers, must manage the human side of finance transformation constructively by gaining the support for change from both lower-level staff and upper management. This article explains how CPAs who sell the benefits of change will gain the employee support you need to implement more efficient finance and accounting methods. SELLING CHANGE Your role as project or team leader must encompass that of salesperson and spokesperson. Just because you have decided that your finance functions are outdated and need to be changed does not mean that others will immediately agree. Most employees will need your help to understand the benefits of process improvements. Finance transformation must be sold, not mandated. It is best to begin by consolidating support among staffers who are not afraid of change and who believe that business as usual is no longer satisfactory. Don't waste your energy on naysayers. Your primary target should be an audience most apt to pass the message to others throughout your company. KNOW YOUR AUDIENCE The most successful change masters quickly learn to customize the message for greatest impact. To do this effectively, you must first understand the concerns and expectations of all your audiences, and you must devise a unique strategy for each. As you tailor your messages, adopt the following three-pronged approach: * Be prepared to inform senior management of both the benefits and the costs of change. Specify cost reductions, return on investment and the impact on cash flow. Also, outline a few tempting "quick fix" improvement opportunities, such as instituting a procurement card and streamlining travel and expense policies. Rest your case on sound research and reasonable estimates of what can be achieved. * Help middle managers focus on results. Show them how better processes enable higher production, cost savings and an enhanced role in the business. * Quell the fears about job security and heightened performance expectations. Most employees are frustrated about the amount of paperwork they have, redundant management controls and other low-value tasks. Explain that these are the very problems your change program will eliminate, and discuss how more simplified processes free up time that can be dedicated to higher-value work such as proactive decision making and planning rather than historical reporting. PROVIDE INCENTIVES FOR CHANGE For your finance transformation program to flourish, the whole organization must believe in change. You can help your employees understand the problems that exist by identifying the solutions. Benchmarking is an essential first step in convincing employees that change is necessary. Benchmarking tells you where you stand in relation to other companies, regardless of industry, and objectively assesses the strengths and weaknesses of your organization. In addition, an unbiased, external measurement is invaluable for any company that wants to remove personal agendas, turf battles and finger-pointing from the change equation. For companies that already have begun implementing process improvements, use a business case to reinforce or heighten top management demand and support for change. A business case should specify cost reductions, return on investment and changes to cash flow. It should make it easy for senior managers to approve your change program by identifying improvement opportunities and quantifying the benefits of change. At many companies, a properly conceived business case can tip the scales in favor of change. After all, not many CFOs will pass up the chance to save millions of dollars annually. …