Change. It’s the only constant in business, yet financial department change management is tricky. Financial professionals are known for their resistance to new processes, new roles and new technologies. From costs to time constraints to comfort with entrenched methods, finance personnel have a myriad of reasons to keep on doing things the ways they’ve always been done.
Some of these concerns are warranted, but ultimately, a resistance to change will dramatically impact a company’s profits and growth potential. Take sales, for example. Once a company grows to a certain size, its sales team won’t be able to adequately forecast for inventory and promotions if they don’t have an ERP in place. Without software-facilitated coordination between sales and finance, they’ll also duplicate a massive amount of work. Time that both departments could spend on revenue-generating activities will instead be spent manually creating similar forecasts for sales and purchases. These kinds of inefficiencies are rampant within companies whose financial departments have failed to embrace change.
Fortunately, there are several strategies that allow management to implement significant changes among finance and accounting personnel. Their fears, while understandable, can also be allayed once they understand how those changes will impact their careers and day-to-day workflows. Following are a few of the most effective strategies I’ve discovered and developed over twenty years of working with, in and for financial departments.
Fears and Complaints
To move forward, you have to understand what’s holding you back. With the financial department, one of the greatest concerns is cost, particularly when it comes to ERP implementation. Accounting sees every expense on the balance sheets, and finance wants to create forecasts that allow for ongoing growth. Neither wants to put a six- to seven-figure implementation on the books. The best way to address this concern is to help every stakeholder understand the long-term gains to be realized by streamlining cash flow forecasting, invoicing, data analysis and just about every other process in the department.
Another common fear among financial personnel is that their roles will change – or even dissolve – post-implementation. What will happen to the employees who manually process invoices when a new ERP automates that task? What about the people who handle paper-based processes for orders, scheduling and distribution? The truth is, most of these personnel can be moved to new roles where their talents are put to better use, and where more of their time can be spent on value-adding and revenue-generating activities.
Finally, time is always of the essence in the financial department, and most employees have little to spare. ERP implementation can be time-consuming, to say the least, and few financial personnel can afford to be pulled away from their day-to-day work. Long learning curves are also concerning for employees who have become fast and efficient with their existing systems. Overall, these time concerns are best addressed by bringing in outside help – not avoiding or delaying the implementation.
Clear, two-way communication is a must for responding to those worries and fears, and for implementing technological and process changes that really make sense. Senior management needs to be on board from the get-go, and they need to communicate to the rest of the company the “how” and the “why” behind major initiatives. Just as importantly, when you start a project, you need to gather requirements from all of the stakeholders involved. For most organizations, the best bet is to establish formal meeting schedules and channels of communication as soon as the project begins. You need a cadence according to which people touch base and ensure everyone is on target with their specific tasks and goals.
In the same vein, you can’t force changes upon people – at least not if you want them to be effectively implemented. During an ERP implementation, management members who are far-removed from day-to-day workflows should not make sweeping decisions that don’t pan out in the long run. Financial personnel need to be consulted regarding the business requirements so that their input can be considered as new processes are designed. This will help ensure a successful implementation.
Once a change is made – particularly a change to a process or procedure – it needs to be documented and clearly presented to all stakeholders involved. Meeting minutes, new rules and agreed-upon tech configurations should be uploaded to shared drives, and relevant personnel should sign off on the decisions. That way, if a key team member or decision-maker leaves, or if disagreements arise, there is always a “master” document for reference.
While most of these recommendations are universal, financial departments still need to implement changes in ways that fit their companies’ cultures. For instance, a company that employs a large number of telecommuters will need to adjust strategies to allow for remote communication. In-person meetings work well for gathering ideas, but mandating them will still breed resentment and resistance in such an environment. These kinds of considerations are particularly important for international companies, whose diverse financial teams may respond differently to certain management and communications styles.
A Fresh Perspective
Ultimately, one of the best ways to implement better business strategies in a change-resistant financial department is to bring in outside help. From a practical standpoint, most controllers and CFOs simply have too much on their plates to devote significant time to something as complex and involved as an ERP implementation. A third party can also offer an independent perspective, free from biases or self-interested opinions. With the right consultant, a CFO or management team can more effectively communicate with their personnel and implement changes faster, more efficiently and at lower cost than an internal project manager.
If you’re struggling to implement new business strategies, processes and technologies within your financial department, contact us or download the guide below!
Kim is a CPA and PMP with more than twenty years of diverse finance, reporting and accounting leadership experience. She is an Arthur Andersen alumnus with extensive experience in accounting operations, inventory accounting, supply chain operations, project management, processing reengineering, systems implementation, policy and procedure development, training development, internal controls and auditing. She has also served as an Interim Controller and led accounting teams through monthly closes and external audits. Kim has industry experience in pharmaceuticals, retail, manufacturing, distribution, technology, banking, family investment and telecommunications at companies including The Disney Stores, Maker Studios, Countrywide Bank, Data Direct Network, Silgan Containers, Fandango, THQ, The Rockefellers and Bristol-Myers Squibb. She holds a Bachelor of Science in Accounting from Syracuse University.
Categorized in: Financial Project Management