Finance Transformation a Significant Priority for Many Finance Chiefs

Finance transformation continues to be a significant priority for many finance chiefs amid ongoing pressures on the finance department to drive the efficiency and effectiveness of the finance function.

A new report from the Association of Chartered Certified Accountants, "Transformation Challenges in Finance," notes that finance transformation continues to be a significant priority for many finance chiefs, yet the importance of effective change management continues to be underplayed.

"We know that effective change management capability is an essential ingredient for finance transformation success, but of course in complex large enterprises, it’s very difficult to master," says Jamie Lyon, ACCA head of corporate sector and co-chair of ACCA’s Finance Transformation Advisory board.

Lyon notes that getting the right sponsorship, effective stakeholder management, deploying the right resources and keeping the transformation on the 'corporate radar' are all change management imperatives.

"One of the biggest challenges for finance leaders is acknowledging that there’s no set of regulations for change," adds Deborah Kops, Managing Principal of Sourcing Change and co-chair of the board.

"Mastering what is often considered 'soft stuff' is key to transformation success. It’s generally not comfortable for a profession that lives by rules."

In the study, the board outlined what they saw as the 10 key change management principles for finance leaders seeking to successfully transform their finance organizations:

  • Establishing the vision – the criticality of spending time conveying the transformation vision and goal
  • Buy in – The importance of CEO and senior management support and sponsorship of the programme
  • Communication – The need for constant communication on what is changing and the rationale for change
  • Preparation – Ensuring finance teams are bought in and committed to the change, and having an effective plan to manage the change process.
  • Resources – Access to adequate programme resources at each critical stage of the transformation process, from developing strategy to achieving ‘business as usual’ acceptance
  • Patience – Accepting that large finance transformation initiatives can be revolutionary and evolutionary with most change processes taking longer than expected
  • Organization redesign – Remembering that redesign and use of finance shared services or outsourcing necessitates change in the retained finance function too – the imperative of changing the finance enterprise in its entirety.
  • Maintaining middle management – Successful change management is key to retaining the middle layer of finance management that is critical to core processes. Yet all too often, middle managers’ numbers are aggressively reduced to justify a business case for shared services and outsourcing, or they are lost in the shuffle.
  • Alignment between capability and ambition – Often finance leaders overstretch themselves to realise a vision that is way beyond their, or their enterprises’, ability to achieve. Being realistic about the organization’s change potential is essential.
  • Working within the culture – Those who implement complex, multi-scope, multi-geography finance transformation programmes, particularly in business-line-led organisations, will experience the greatest change challenges. Gauging the type of change the culture will allow is an imperative.