Evolving the Office of Finance
Recently, our COO, Alok Ajmera had the pleasure of speaking to a group of finance executives at the Argyle Executive Forum in Atlanta. The article below summarizes his presentation (courtesy of Argyle) including actionable takeaways to transforming the Office of Finance.
Alok began his thought leadership presentation at the by asking, “Why are people talking about the evolution of the office of finance?” This has been a theme of this leadership forum, he remarked, but why is this transformation necessary?
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First, the pace of change is accelerating at a dramatic rate. There are many reasons for this—economic pressure, competitive landscape, volatility in the marketplace, changing workforce demographics, and the volume and velocity of data. Ajmera pointed out that changing workforce demographics—particularly the influx of Millennials—is creating a transformation in how work is getting done. Work doesn’t come first for most Millennials—we see few of them coming in on the weekend, staying late, etc.—so how work is accomplished needs to become smarter, he observed.
“Data flow—the sheer amount of information, the speed at which it’s coming in, and the impact it can have on a company—is another major reason for the rapidly accelerating pace of change.” Ajmera sees the amount of change that happened in the last 50 years happening in the next five years. “In five years, what will people say about your and your organization?” he asked.
The reason people are talking about the evolution of the office of finance can be summarized in one sentence, said Ajmera: “Business cannot survive in current conditions without a more robust office of finance.” The primary reasons for this failure to survive are the pace of business, too much data to be processed, and an enormous pressure for results. Data-driven decisions need to be made more and more quickly.
“Why do I say a business can’t survive without a more robust office of finance? Why don’t I say ‘office of marketing or sales’?” asked Ajmera. The finance team has three attributes that allow it to successfully solve problems associated with data flow, rapid changes, etc.—being data savvy, analytical, and, most importantly, neutral.
“Finance needs to slow down and interpret data coming in from inside and outside the organization and present it as consumable recommendations for making good decisions,” said Ajmera. “This means going way beyond normal, day-to-day accounting processes. It requires putting planning and analytics on steroids.” Finance is moving from processing transactions to analyzing them to making recommendations to the business.
Here are Ajmera’s actionable takeaways to accomplish this necessary transformation in the office of finance over the next five years:
- Make the collection, processing, and dissemination of your data easy.
- Invest in your infrastructure—your people and technology.
- Partner with your business. “This is a major failure point,” said Ajmera. “I’ve seen really smart CFOs and teams build out a whole set of data analytics, come up with all this insight, and develop recommendations on how to move the business forward without including the business in these processes.” When these changes are proposed to the business, the business responds with, “Who are you to tell me how to run the business? You’ve never sold or marketed anything. Go back to crunching numbers.” You have to partner with the business, so it sees the value.
- Stay calm, don’t panic, and take one thing at a time. Make a plan of where you want to be in five years, and then map out the incremental steps to get there. “Start with your data, invest in your people, and you’ll have a great future.”
Do you agree with Alok’s intelligence on the future of finance? Let us know in the comments.