Marching Towards an Autonomous Finance Function – 301

In part-1 and part-2 of the series, we discuss the need to invest in tech-driven finance talent and normalize and unify disparate data sources to maximize returns from investments, respectively. But complicating these processes and embarking on them without definite plans will fail to deliver the necessary outcomes. Keeping processes simple is key to improved collaboration and higher efficiency gains, and this is the third step in building a robust autonomous finance function.

Step 3: Simplify the ways of working

Time and again, CFOs experience shortcomings with digital technologies failing to effectively simplify the ways of working and modernize the finance function. Instead of making it easier to do business, things become more complex for both internal and external stakeholders, leading to poor user experience. Unfortunately, this phenomenon is not a reflection of the digital technology itself; it is a reflection of the finance function not taking a pause to challenge the status quo.

As many organizations scale back incremental technology investments in 2023, it is opportunistic for CFOs to validate existing practices to ensure they reflect the evolution and strategic direction of the business. Taking the time to simplify the ways of working can help finance departments stay current with emerging needs and accelerate their journey towards digitizing operations. CFOs can take the following actions to drive progress toward simplification.

a) Develop fresh design thinking approaches for existing practices

As creatures of habit, it is not surprising teams are accustomed to existing business practices, even if they are no longer relevant, fail to deliver value, or contribute to inefficiencies. CFOs can create a safe space and empower their teams to identify and challenge historical practices. With guidance, team members can work together to prioritize the opportunities, align on expected outcomes and rethink how best to deliver on the goals. When undergoing this exercise, teams should not be bound by existing internal policies.

b) Validate and clarify core accountabilities

As the finance department is in a constant state of change, including the use of shared capabilities and remote workforces, it is easy to overlook the need to formally refresh and communicate core accountabilities. Leaders owe to their teams to ensure accountabilities continue to be relevant as the business changes. The accountabilities need to be clearly understood by each team member. Establishing updated roles and responsibilities provides the platform to drive the right behaviors and relevant performance measures for each team member.

c) Reduce manual handoffs required to streamline existing processes

Our teams commonly suffer from inefficiencies, errors, and rework that inherently surface from activities subject to multiple handoffs. Without wholesale end-to-end process redesign efforts, teams can explore how best to reduce the number of manual handoff activities. Reduction of manual handoffs may require the team to rethink how best to increase data quality at the onset or consolidate data attributes collected in-between the handoffs. Furthermore, the teams should explore the need for augmenting the processes with automation capabilities to reduce the number of handoffs, improve data quality, and facilitate a more dynamic accumulation of data attributes. Reduction of handoffs between individuals and better data quality will organically improve employee experience and unlock the time needed to focus on more value-added activities.

Just as we finally won the war against COVID-19, we are bracing for the weakest economic growth since 2001. Yes, cost management is at the forefront of every CFO. Unfortunately, a higher cost of capital is going to make it harder for CFOs to justify expensive technology investments. However, these cost constraints should not prevent the CFO from advancing their finance transformation agenda. Alternatively, CFOs can take advantage of the current times to introduce forward-looking capabilities on their teams and upskill talent. They can finally help their team take a pause and rethink their data strategy without the disruption of in-flight technology deployment. Lastly, CFOs can help their teams simplify their ways of working and make it easier to do business. It is opportunistic for CFOs to pivot away from a technology-led transformation journey and adopt a business-led transformation journey. Defining and executing a finance transformation journey that starts with the business first sets the CFO up for success and helps their team embrace the change. In the long run, it is far more cost-effective and enables you to unlock value from technology investments effectively.