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Effective Change Management Is Critical for Your People in a Finance Transformation

Effective-Change-Management-Quote-2022

A finance transformation is a fundamental change to your organization, to the way you do things and how you think about your operations. And since a lot of folks take to change about as well as an afternoon root canal, especially in the accounting and finance functions, a transformation can ruffle a few feathers, to put it lightly.

But that’s where organizational change management and design come into play, minimizing those ruffled feathers and rattled cages. Together, they can ensure your transition from the old ways of inefficient, manual processes to an automated, streamlined wonderland is blue skies and value creation as far as the eye can see. And we’re giving you a roadmap to get you there.

The CFO’s Roadmap To Finance Transformation

What Is Change Management? How Can it Drive Transformation?

Before we jump into the methodology and heavy lifting, let’s start by level setting what a finance transformation strategy means to your people and how it falls under the change management umbrella. Or, as SHRM defines it, “Change management is the systematic approach and application of knowledge, tools and resources to deal with change.”

A bit vague, right? And how does that apply to finance transformation? Well, we hear so much about the mighty triumvirate propelling a transformation forward – people, processes, and technology – and for good reason. Each is absolutely critical for driving genuine, foundational change that creates value through data and insights.

Not enough is said, however, about the people component of a change strategy or the uniqueness of every organization and culture. That’s why it’s so important for a leadership team to tailor their efforts to their peoples’ specific needs and put on an employee’s shoes to truly understand how they view organizational change. To many, it’s nothing more than a bot invasion that will inevitably take their job, turning their lives upside down in the doing.

 

Why Do People Resist Change?

That’s exactly why people are afraid of change – they’re afraid of the uncertainty or a negative impact on their lives in some way. However, much of that fear stems from a lack of understanding of the concepts and reasons for embracing a transformation in the first place. Therefore, successful change management starts with equal parts education and explanation from the higher-ups, both key to implementing change.

People need to know the new processes and technology coming down the pike aren’t random or the managerial flavor of the month but, instead, the keys to a more efficient, agile, and prescient enterprise. And that benefits everyone, from the CEO down to the newest of new hires.

Yes, depending on the scope of the initiative, the workplace and workforce might look different post-transformation, but that’s not a bad thing, just different. Above all else, employees want peace of mind, knowing how they’ll fit into the “new” organization.

Therefore, since a successful change management plan largely hinges on people accepting it, helping them understand the concept, what it means for them and the organization, and developing buy-in are crucial initial steps. And that leads us to our next point.

 

How to Succeed at Transformational Change: Start at the Top

As we said, finance transformation is going to require buy-in from your people to make it work, just like most major initiatives. And since the C-suite leads nearly every significant charge – and change – within an enterprise, it only stands to reason that your executive management team plays a massive role in establishing that critical buy-in.

Continuing the change management theme, top-down communication from change leaders is crucial to the people component of a finance transformation. Our advice is to begin this essential stage with initial stakeholder engagement, where you:

  • Create urgency around the business reason for change
  • Communicate with the key people directly impacted by the function or functions changing in the transformation
  • Develop more buy-in to convert these key stakeholders into your guiding coalition

This approach gives room for those stakeholders to develop faith in the initiative and communicate information back to their people. From there, project management can launch a more broad-based, top-down communication plan to convey a few critical points:

  • The transformation is happening and is not optional
  • Change isn’t a gremlin waiting to ruin their career
  • Organizational transformation benefits the entire organization, people included

 

Other Tools and Strategies for Transformation Success

It’s not just about the communication flowing down from your enterprise’s rafters, though. Along the way, pulse polls can effectively gauge buy-in and measure change fatigue across the impacted functions. Along with key metrics, these types of tools can assess and assist with business readiness while also providing insights on areas the guiding coalition can focus to improve engagement, understanding, and acceptance of the inevitable.

Also, addressing specific pain points that a department, group, or individual experience in the current state can have a dramatic impact on buy-in. For example, accountants aren’t exactly known for their open embrace of change, so they might be especially wary of a finance transformation.

However, when they hear these change efforts include digital tools that will automate formerly manual business processes – therefore removing much of their transactional, tedious work – they’ll probably see the light. The additional time that would have otherwise gone into that transactional work also gives finance the opportunity to be better business partners.

 

Managers Are Ideal Change Agents

Building on the previous points on broad-based communication, engagement polls and surveys, and messaging from the top, mid-level managers are yet another essential piece of the buy-in puzzle.

They’re the folks on the ground, listening to real conversations with employees and, most likely, have a better understanding of genuine thoughts behind the pending change. Perhaps most importantly, since change management usually entails some degree of handholding, managers can function as critical change agents for the enterprise.

As such agents, they’re supporting the impacted people and helping gauge success, both in buy-in as well as the change process itself. Also, since teamwork and a company’s culture are such significant parts of the entire process, these eyes and ears across the middle and lower levels of an organization are important in monitoring any effect the change initiative has on organizational culture.

 

Organizational Design Drives Organizational Change Behavior

A finance transformation isn’t just about helping employees understand and adapt to the change, thus driving organizational behavior in a desired direction. It also entails the organizational design that drives that transformed behavior. Because chances are, without needed restructuring, there are going to be misalignments between seats and assigned supervisors that wreak havoc on efficiency and productivity.

For example, let’s take a hypothetical company with cubicles full of innovative accounting and finance minds stuck in the transactional process swamps. If the company were to initiate a financial transformation, the organizational restructuring turns much of the work from policy enforcer to decision-support partner.

This change occurs as the company centralizes transactional processes and aligns roles to the right leadership. In the process, it frees those innovative minds in accounting and finance to leverage their core competencies and, thus, expand analytical work across the organization.

As a result, employees will naturally upskill to better understand data and provide insights to operational partners, not to mention the improved decision-making, problem-solving, and productivity that comes along for the ride.

Granted, all of these insights on change management and organizational design are fantastic on paper but, when it comes to actually implementing them, there are only so many hours in the day. In realty, these action items require time, effort, and expertise, three assets that are usually in short supply. Remember, as critical as a finance transformation is, there’s still a business to run.

That’s why Embark’s team of finance transformation specialists exists – to ensure you reap the full rewards of transformed accounting and finance functions without negatively impacting operations. So whether you’re looking at a change project on a single process or a ground-up transformational change, we're here to ensure you reach your ideal future state.

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The CFO’s Roadmap To Finance Transformation

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