How Finance Can Spearhead the Transition to Business Agility


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Monday, August 16, 2021

If the COVID-19 pandemic taught us anything, it’s that nothing is certain, and even with the most advanced planning, everything can change within a matter of days. Because of this, it is more important than ever for businesses to be agile, flexible, and adaptable.

Article 5 Minutes
How Finance Can Spearhead the Transition to Business Agility

Advanced planning allows teams, in particular finance teams, to anticipate whats coming, act faster, and better deal with market shifts and competitive threats.

This is where business agility comes in.

This is the process of rapid, continuous, and systematic adaptation and entrepreneurial innovation used to gain and maintain a competitive edge. It also requires organizations to embrace digital transformation.

The problem is, most organizations start their agility journey by replicating existing structures, and these tend to start within tech functions. This might sound good, but the problem is, as the agile journey begins to cross departments and more processes are put in place, the cracks start to show, and there are challenges of misalignment between these different teams.

Therefore, finance teams should be the ones to lead the transition to business agility within an organization, and heres why:

Why agility is important to organizations

It has been proven that companies with agile finance teams are overall more successful than their competitors. This is because they’re ahead when it comes to implementing FP&A and the right tools, such as robotic process automation (RPA) and cloud-based systems.

Research by Accenture also revealed that, along with increased revenue, organizations with agile finance teams could expect greater brand recognition and market share, shorter turnaround times, improved relationships with customers, greater transparency, and higher employee engagement. 

So as you can see, financial agility can be hugely important and beneficial to organizations, and it can give businesses an impressive lead over their competition.

How finance can lead the way for business agility

With a better understanding of business agility and how it can be beneficial to finance departments, organizations need to consider whether the finance department itself can spearhead the transition to business agility across the organization.

Not only is it possible, but it’s an important and logical place for organizations to start.

1. Integration into a single system solution must start somewhere

In order to move forward as one, organizations should embrace digital transformation and encourage collaboration. And this can start within the finance department.

One of the best ways to embrace agility through digital transformation is to move away from having multiple operating systems that vary from department to department. Instead, integrate all data and processes into one single, easy-to-use system for transactional operations and analysis.

This will ensure everyone on the finance team and others from around the company have access to real-time data and insights. And by investing in a single cloud-based platform, finance teams can implement agile planning and forecasting, as well as advanced reporting and analytics. It also makes it possible to align KPIs and monthly targets with larger financial goals.

Starting in the finance department, this new connected system can get the ball rolling on collaboration and achieving business agility across the company as a whole.

2. It’s important to centralize finance and accounting processes

Though many companies still require multiple systems for industry-specific processes such as logistics and manufacturing, fragmentation in planning, financial management, accounting, and reporting can lead to poor or costly decision-making.

This is because siloed systems make it harder for finance teams to offer advice on budgetary decisions. And as we said above, a single system can drastically reduce the disconnect between different departments.

Therefore, centralizing all finance and accounting processes makes it much easier to embrace and encourage continuous planning, quick systematic adaptation, and entrepreneurial innovation. Which is ultimately what business agility is all about.

3. Finance teams will reap the rewards of automation

When it comes to automation and digital transformation, the finance department is often the starting point for many businesses due to the nature of its job. After all, a great deal of data must be processed by the team, and much of this is going to be private or confidential. Plus, it’s crucial to reduce the risk of errors as much as possible when it comes to financial transactions and analysis.

Not to mention that organizations are increasingly demanding regular forecasts and budget updates to inform their plans and make crucial financial decisions.

So, by moving away from outdated back-office systems and embracing automation and planning tools, finance teams can lead by example. They can prove to other departments that digital transformation can reduce the time spent on labor-intensive tasks, boost productivity, and increase the amount of work they can deliver.

A clear example of the positive impact digital transformation can have could be all it takes to win investment for other departments, so your organization can become automated and more efficient.

4. They can transform talent across the business

And finally, building an agile finance organization is no mean feat. It requires professionals who have skills that barely even existed a decade or so ago. As such, finance teams must be made up of a mixture of professionals with the relevant FP&A skill sets.

This means that employers and recruiters need to take a different approach to finding and crafting their teams. They must look for talented individuals who can perform sophisticated analyses and regularly provide insights on strategic business issues across different departments.

If they look for professionals with the right hard and soft skills, for example, technical skills as well as flexibility and adaptability, then an agile team can be created.

And, as the finance department is such an important and influential part of the organization, it stands to reason that senior management will see the results and implement this way of thinking and operating elsewhere within the business. This will ultimately lead to a more skilled and centralized workforce, something which is vital to achieving true business agility.

Further reading

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