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  • Justin Lake

What is a Finance Transformation?

Updated: Mar 15, 2021

I’m often asked what a Finance Transformation is. This whole concept of transforming is more important than ever especially for the finance organisation. With COVID-19 shaking up the whole world, our ways of working have changed forever. The driver and need to modernise finance systems, process and people is not just a nice stretch goal it is a necessity to survive.

There is a need to do more with the same or fewer resources. Business needs to respond better to fast-changing economic and business conditions. There is still ongoing pressure from management and external stakeholders – for faster and more detailed information to support decision-making. Data volumes are exploding from internal systems, websites, and external sources such as social media. And there is a need for better Finance and operations alignment – getting operational plans and models aligned to financial plans. These are all drivers of change that are forcing us, as leaders to focus on transforming our technology, processes, and people to be far more responsive and agile.

The general definition in the market is the notion of Finance moving from backward-looking scorekeeper – to forward-looking business partner. Achieving Finance transformation requires changes in people, processes, and the technology to support those processes.

1. Ensure efficiency in transaction processing through cloud based ERP systems

2. Shifting the financial planning and reporting processes from spreadsheets to online systems

3. Annual budgeting process simplification

4. Granular budget assumptions and ability to compare to actual drivers

5. Empowering the business to build self-service management reporting

6. Financial Close Automation and visibility

7. Shift time from data collection to more analysis and supporting LOB executives

8. The move to real time payments and reconciliations

9. Non-technical system integration

10. Less reliance on high-maintenance infrastructure

There is often a perception that Finance Transformation is a complex and long-drawn-out process. Its not really a process, it is a philosophy and a shift in mindset. Instead of making excuses and getting caught up in day to day business activity, its about having an aspiration for the finance organisation but at the same time doing something about it to reach your goals.

‘Dream big, start small, but most of all, start.’ Simon Sinek

Some of the key areas for finance to realise these opportunities are in the following categories:

• Principles of performance management

• Planning, budgeting, and forecasting

• Cost and profitability management

• Management reporting and analysis

• Business partnering

• Finance strategies

• Finance strategy

• Capital management

• IPO (Day 1) readiness

• Events and turnarounds

• Finance data management

• ERP systems implementation

• Performance management systems implementation

• Ancillary systems implementation

• Analytics

• Operational finance

• Tax

• Treasury

• IFRS treatment

• Mergers & Acquisitions

There has never been a better time to embark on this journey and get started on your finance transformation journey. Worked with people who have been down this path before and can guide you to avoid some of the common pitfalls. Rome wasn’t built in a day but as Simon Sinek says

‘Dream big, start small, but most of all, start.’

Justin Lake is the CEO of Think Numbers, a Finance and Transformation consulting business to help organisations on the path to excellence through Finance Transformation. Feel free to get in touch.

For more information please reach out to us for a no obligation discussion.

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