In an attempt to scale savings and increase process efficiencies growth minded CFOs and Finance Leaders opt for Automating their financial processes with a vision of eradicating manual processes and streamlining their invoicing and purchasing functions.Automation, with the myriad benefits that it offers does have a feel-good factor attached to it. However, many organizations struggle to roll-out the solution. This is where the concept of change management comes into play, the purpose of which is to implement strategies that help effecting, controlling and adapting to change as per the definition stated in Tech Target.
For change management strategies to be effective it is extremely vital that the technology chosen involves the inputs of Finance, Procurement and IT. Systems like ERPs are mainly chosen with inputs from only the IT and the Finance departments which lead to disconnected deployment strategies and maverick spends.
What can organizations do to make their digital transformation projects a success?
1. Prioritize your process automation efforts : When the organization has decided to automate, a common mistake is to automate all the processes simultaneously . To avoid this, organizations can choose to adopt a bi-modal approach to deployment. In this approach mode 1 can include the core and critical functions that need stability and mode 2 can consist of functions that add value to the core functions. This approach will allow decision makers to build customized strategies and timelines for each of the functions that fall under these modes.
2. Involve all stakeholders: Collaboration is key here. It is essential to involve Finance, Procurement and IT while selecting a solution to automate the entire purchasing to payables process so as to ensure best stakeholder experience throughout.
3. Define clear automation goals, metrics and ROI: In case of automating your invoicing and purchasing functions it is essential to first list down your expectations from the initiative and work towards choosing a solutions that caters to those expectations. Another element that excites the upper management most is the ROI gained and the increased process efficiency from Automation. While ROI from sourcing automation projects might be a little harder to determine due to the inherent intangibility of the results, it is relatively easier to measure ROI for Procurement and Accounts Payable Automation by keeping track of percentage reduce in maverick spend, increased savings and reduction in cycle time. That being said it is ideal for organizations to expect ROI from Financial Process Automation only after 6-8 months of implementation.
When it comes to process improvement timelines, it is essential that organizations consider their automation maturity level before setting process improvement timelines. Given below are a few process improvement timelines according to the automation maturity stage the organizations fall under:
Source : Paystream Advisors (The C-Suite’s Guide to Successful Accounts Payable Transformation)
4. Focus on Data And Analytics: To become valued and strategic advisors of the organization as well as facilitators in the decision making it is essential that both Finance and Procurement leverage automation to tap into the abundance of data the tools make available to the user.
5. Pre-empt the potential transformation scenarios: There’s a lot of uncertainty when it comes to automation projects pertaining to the timeline, the cost incurred, the ROI etc . To assuage a few of them it is better to outline potential scenarios that decision makers might encounter like resistance from stakeholders; the staff, the IT department, Upper Management etc.
To obtain more ready-to-execute and actionable change management and deployment strategies from global industry experts like Jon Hansen (Lead Writer & Editor, Procurement Insights), Kelly Barner (Buyers Meeting Point), Magnus Lind (CEO & Co-Founder, Skanor Group) join our complimentary webinar.