Transformation happens over time but companies and people have short attention spans – so how do you tackle that conflict? The answer is to have a clear vision, align with your businesses and look at the organizational structure to enable systemic and long-term change. “You can’t drive by looking in the rear view mirror. You need to know where you are going” stated Dennis Dodo, CFO at BC Ferries.
Establish stakeholders and governance structures like a steering committee that includes the CFO. Then, set up your team to support quick decision making and collaboration while also standardizing end-to-end processes, but be cautious because too much standardization slows down decision making. Analyze your work and ask yourself, “Are my teams reactive (ineffective) or proactive (innovating)?”
1) Develop an organizational structure that focuses on Operational Excellence (people, technology, regulatory, reputation) while reducing risk. Implement systems with:
a) Management controls
b) Finance compliance
c) Internal audit
2) Create “Big Rules” centered around:
a) Simplification
b) Standardization
c) Automation
3) Find the balance between 100% standardization versus over-customization
a) Overly complex processes increase risk and cause variation in your data which, in turn, increases inefficiency
b) Process mapping/flowcharting can help you find that balance and set you up for change management best practices
4) Recognize that “The Long Game” is getting shorter: In 1958 the average age of Fortune 500 was 61 years; in 1999 the average age of Fortune 500 dropped to 28 years; and most recently, in 2011, the average age of the Fortune 500 was only 12 years!
By building your process around the long game, you align them with long-term, company-wide goals and can enact structural improvements that can be sustained from project to project and year to year.
View the complete Finance Transformation Conference Brief.