How to deliver a successful Finance Transformation project?

As the business landscape evolves at an unprecedented pace, organisations face a crucial choice: embrace finance transformation or risk falling behind. We sat down with APAC Managing Director, Alex Ramambason, to discuss the challenges businesses are facing, and how the implementation of Finance Transformation can create impact for our clients.

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‍Q: Why is Finance Transformation needed?

‍A: The purpose of Finance Transformation is to enhance the value and effectiveness of a company's finance function by refining its processes, governance and audit compliance, technology, and personnel. This leads to more precise and current business metrics, which assist business owners in making well-informed decisions faster, guiding the company in the right direction to achieve its goals.

Early warning signals suggest when a Finance Transformation is necessary, such as when sources of data are scattered, data entry and transaction approvals are excessive and manual, transparency and traceability are a significant concern, leadership does not receive sufficient detail in their reports, or when the accounting system is outdated and impedes the company from reaching its cost and revenue objectives.

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‍Q: What is a typical Finance Transformation project?

‍A: Finance Transformation projects can involve many work-streams depending on the scale and maturity of the Finance function within the Organisation, but it typically includes the following initiatives:

• Business Process Reengineering: review of existing processes, with identification of pain points and areas of improvements that will lead to a new way of working for both Finance and Ops teams.
• Technology implementation which can consist of a replacement or just an upgrade of existing platforms to power these to-be processes with automation, system interfaces, etc.
• Target Operating Model and Team organisation re-redesign to define the new way of working that will be future proof.
• Data Analytics and Reporting to extract maximum insights from the Business in a timely manner.
• Change Management to ensure the whole organisation (not just Finance) is embracing this journey and are fully equipped to deliver their full potential in these new ways of working.
• Continuous iteration and improvement are also crucial. Once a new process and technology is implemented, businesses from Day 2 unleash the benefit they bring to the business.

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Q: What are Finance Transformation best practices? ‍

A: From our experience working with medium size organisations to enterprises, some of the best practices to adopt include:

• Conducting a holistic assessment of the current state of People, Processes, and Systems to define the scope and roadmap for transformation.
• Defining a clear roadmap for achieving the desired to-be state, focusing on building or strengthening foundations before continuously improving specific areas or expanding the reach of the change.
• Selecting and implementing technology that enables people at all levels of the organisation to perform better, such as new systems, integrating existing ones, and leveraging new technologies like Data Visualization tools, OCR or AI.
• Defining a comprehensive change management approach that involves people beyond Finance as transformation impacts more than just the Finance function.
• Investing in people’s re-skilling and development to equip them with the necessary skills for the new ways of working.
• Monitoring and measuring progress each step of the way and adjusting, if necessary, as transformation is an ongoing journey and new challenges can arise. The best improvements are continuously refined to stay in line with external factors.

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Q: What is the future of the finance function? ‍

A: The Finance function is expected to evolve from an administrative function to a data analysis and business insights generator, utilising automation and upcoming technology changes. The team will focus on higher value-added activities like data and trend analysis, planning and forecasting, growth opportunities assessment, and strategic decision-making while promoting sustainability and social responsibility. In the future, the Finance function will extend its reach across departments and collaborate more effectively with other teams to provide business insights at each level of the organisation. Additionally, risk management and compliance will become a more prominent focus due to maturing regulations.

Many organisations strive to move towards a strong finance analysis function rather than accounting. Question is how centralised and automated your finance process can be where your finance team spends majority of their time doing high valued business partner?

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‍Q: How do we build an effective Finance Transformation roadmap?

A:  

• Start with the end in mind: Define the scope and objectives of the transformation, keeping in mind that it may impact other functions beyond Finance.
• Onboard the impacted teams early in the definition process to get early buy-in. Change management is key!
• Focus on building foundations: Just like building a skyscraper, foundations need to be robust before looking at the advanced functionalities or processes.
• Emphasise on initiatives that are critical to the success of the transformation, especially those that are too often underestimated or neglected, such as system localisation, data migration, testing, training, and change management and that can cause the journey to deviate if not managed properly.
• Build up and maintain the change momentum: The phases in your roadmap need to be sized long enough to observe substantial change, but also short enough to enable such change quickly and achieve quick wins on a regular basis. Stay agile.
• ‍Keep the roadmap practical and flexible: Phases, workstreams, milestones, dependencies, target regions, countries, teams, etc need to be organised in a practical way to maximise adoption and benefits, whilst being able to cater to changes of direction, minimising costs and risks.
• ‍Define a clear governance structure to manage the roadmap, including roles and responsibilities, reporting and escalation channels, and governance forums.
• ‍Communicate widely and regularly on such Roadmap throughout the organisation to raise awareness and encourage adoption.

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Q: How we approach Finance Transformation that would bring a differentiated value to our client? ‍

A: It's a common misconception that a new system can solve an organisation's challenges across the board. However, technology is merely an accelerator. If a company designs the wrong process or brings in the wrong data, the technology won't make those issues go away but rather amplify them. Our clients may purchase the best technology available, but without a clear view of how to utilise it to extract its full potential, their chances of success are already limited.

At Lancia, we understand that technology alone is not enough. Beyond our industry knowledge and technical expertise, we focus on anchoring the solution design to the people, their roles, and the processes they execute. We also help our clients to exploit their data better while facilitating user adoption throughout the journey, leveraging our best practices and industry expertise.

Our comprehensive approach covers all the workstreams involved in a Finance Transformation project, including roadmap definition, business process reengineering, technology implementation, system integration, target operating model and future organisation design, and change management. We help our clients succeed by designing the most effective processes and working with them to extract maximum value from their data.

Partnering with Lancia ensures that our clients are set up for success, with the right strategy, people, and technology in place to achieve their transformation goals.

We succeed when our client organisations succeed. As much as Day 1 of go-live matters, we focus on how Day 2 works in a client organisation when the rubber hits the road.

If you would like to discuss working with us on a finance transformation project, please get in touch and contact us today.

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