Important first steps in a Finance Transformation include creating alignment among finance leaders and external stakeholders and creating clarity around objectives. However, an equally important and frequently overlooked early objective is to create an environment where positive change is easy.
What I have found in working on several finance transformations is that most finance departments do not start with that type of environment. Yes, I know you think your organization does have such an environment; the leaders always think that. You can make positive changes and you would like everyone else to as well. How confident are you that if you surveyed your staff, they would say it’s easy to make improvements? How many would say they had implemented an improvement to their processes in the last three months?
I have spent hundreds of hours in process improvement workshops with finance and accounting teams. I start by walking through a process with them, writing on yellow sticky notes each step and sticking them to a whiteboard in order. Before I start process mapping , I always introduce the concept of IPOs.
IPOs stand for Improvements, Problems or Opportunities. I tell them that as we map this process, we want to identify any problems they encounter or ideas they have for making the process more efficient or more effective. When we find one, we’ll write it on a pink sticky note and stick it above the relevant process step. Inevitably, the staff comes up with a dozen or so IPOs in a process. Often there are more pink sticky notes than yellow ones. Sometimes half a dozen on a single step.
These are all problems or opportunities the people doing the tasks every week can find in their own tasks. So why have they not already addressed them?
Most finance and accounting staff face some or all these obstacles to making improvements:
- Not believing their job responsibilities include improving the processes they perform
- Lack of visibility upstream or downstream from their process to see how a change might impact others
- A supervisor who does not support making changes out of fear of unintended consequences
- Insufficient technical skill to make the change themselves
- Undeveloped soft skills or internal credibility to get support from other stakeholders
- Unmotivated to find efficiency because they do not know (and possibly fear) the consequences of having less work to do
So how do you create an environment where positive change is easy? You can start with these steps:
- Make it explicit that everyone’s job includes two parts: performing their processes and improving their processes. Consider modifying their job descriptions.
- Encourage them to meet with the internal “suppliers” of the inputs to their processes and with the internal “customers” of the outputs and to discuss how the inputs are created and how the outputs are used.
- Make sure supervisors and managers are onboard with empowering employees to identify and make improvements. Redefine their roles to explicitly include helping their staff to remove the barriers to realizing the improvement opportunities they see.
- Ensure leaders are helping staff to work with upstream and downstream departments and use your peer network to get their support.
- Be forgiving of and help staff constructively learn from mistakes. Improvements require changes and changes can have unintended consequences. The key is to become an organization that has a competency in making improvements without causing problems. It’s nearly impossible to do that without any early hiccups.
- Celebrate and recognize improvements, no matter how small.
Frequently ask staff what ideas they have for improving their own work. I’m not talking about a suggestion box for improvements the leaders can make. Rather, I’m talking about challenging the staff to think about how they can improve the processes they own.
Many organizations only focus on improvements in the areas that the top leaders have prioritized. Accordingly, they are missing out on the opportunity to transform at a much faster pace, making the hundreds of improvements that a workforce empowered to improve their own processes could make.