Transformation and…peace of mind

Guaranteeing and securing the production of financial data against a background of profound transformation in the organization

Transforming, reinventing or adapting your performance management model? Yes, over a three or six month, or one or two-year time frame. But what about tomorrow? Next month? Am I capable of maintaining the reliability and quality of the financial information I report given the uncertainty and awkwardness of the profound transformation affecting the company, whether it is a complete reorganization or an evolution of the business model, implying a need to adapt the financial controller model?

Just so many questions that the Finance teams, and particularly the Financial Control department in large groups undergoing profound transformation must find answers to. Because business won’t wait. Because financial markets don’t wait. Because the financial controlling cycle is a perpetual exercise in the analysis and understanding of the figures, in order to anticipate and manage the business. Our various contributions to such projects bear witness to the importance of a specific unit to support financial reporting and of synchronization with the “project” teams to provide agility, flexibility and responsiveness, thus constantly challenging the new financial reporting model, and guaranteeing that it is robust and has buy-in within the organization.

A back-office so much like a “front-office”

Whereas the forms and incarnations of the transformation of a company can be many and varied (for example, the shift from a product driven vision to one driven by channel or customer segment), they are never more visible than when they affect the performance management model.

Financial control is the “shared asset” upon which all parts of the organization, all levels of management, and all the functions, rely. Between ‘reassuring’ comparisons to the budget and recurring latest financial forecasts that provide visibility of future performance and the ability to anticipate and correct going forward, it is everybody’s business. If this backbone is rattled, so can the entire information reporting system: financial communications geared to markets and investors, the presentation and approval of the budget during business reviews, and the relaying of information concerning the latest forecast data.

In other words, a back-office that has never been such a misnomer: as critical as it is indispensable, as unchangeable as it is in constant search for optimization, it supports decision making for the business and guides the financial steering of the entire company.

An agile and responsive “task force” in support of transformation: anticipating disturbances to the financial control model to best provide answers

In view of the scale of disturbances to the management cycle created by a transformation program, the question of continuity of financial communication reporting must be put very early on, well before the first initiatives kick off and purely ‘project type’ workstreams emerge. The whole challenge here lies not only in the ability to support transformation, but above all in implementing a system capable of responding to production challenges, integrity and reliability of financial data.

Using a specific team to support financial control in parallel to the transformation program, makes it possible to contribute early on to the definition and co-construction of a new reporting model. It is an initial filter for one-off requests brought about by the transformation. Positioned as a designated point of contact for the Group’s financial control department and the partners in finance (divisions, subsidiaries, existing customers etc.), it centralizes the needs and requests for changes to management reports, is in a position to challenge them and to assess their technical feasibility to propose suitable solutions.

Without replacing the financial control teams, the support team can assist them in creating new reports and dashboards, taking over a part or even the whole of the report creation process, from design to testing and implementation (formatting, automation, delivery and enhancement of the information systems). This specific “task force” type team (in-house or outsourced via a service provider) brings flexibility and responsiveness with its ability to deal with ad-hoc requests, free from the constraints imposed by a set scope, and able to broaden and expand its areas of activity. The time that is freed up for the operational teams then enables the latter to focus on the specificities of their business environment and provide added value to the management of the company.

Synergies between the “transformation” team and the “support” team for the longer-term effectiveness of the new control model

The ongoing dialog between those involved in the transformation and the financial control support team not only makes it possible to ensure a transition to the new model, it also enhances its construction. The synergies between the support and project teams are all the stronger and clearer because the teams are drawn from the same organization, particularly if an external service provider is used.

The aim being, apart from ensuring the transition to a new model, to secure its medium and longer-term effectiveness. And that means a complete overhaul of the information systems. Working closely with the operational finance teams and IT, the support team, capitalizing on its knowledge of the financial control model and the reporting tools, assesses the possibilities of adapting the tools to the new reporting and organizational model, and supports the implementation of the chosen solutions. Taking ownership of the new model right across the organization is a prerequisite for its longer-term effectiveness. It is particularly important to make sure that the operational finance teams in all parts of the organization have the right skills. Sharing best practices, explaining the issues that underlie the transformation of the financial control model, and providing documented methodologies explaining the component parts and mechanisms are powerful divers for the successful implementation of the new model.

This final step means the gradual disappearance of the old reporting model, to be replaced by the tested and reliable new model as built by the “task force” team. In conclusion, against a background of instability and uncertainty created by a company transformation program, implementing these arrangements allows the organization to reinforce its capacity to satisfy business needs while developing a new reporting model that is solid, reliable and long-lasting.