Transformation in tough times – trouble with Finance?

With the budget coming up we asked the team at Herd for their experiences working with Finance and Finance Professionals on transformation projects, both within Finance itself and those that impact the whole enterprise. 

Transformation in large complex organizations is always challenging, but in times of heightened economic stress it is even more so. Just look at the agonies and contortions of our own Chancellor as she tries to reconcile the seemingly irreconcilable.

So what is it about Finance and why do we so often see conflict between strategic and financial goals when they should be aligned if we want the organisation to succeed?

There is no question of the respect that the finance profession is held in:

71% of our respondents agreed that Finance Professionals are “Forensic and challenging, but ask the right questions”.

“They are too thinly spread so it is difficult to get their time, but once you do, they are extremely helpful, transparent and collaborative. Have unblocked issues for me.”

And there is clearly an understanding that Finance has different drivers that need to be taken into account for any project, for example one commented that:

“Regulatory compliance is paramount, therefore data accuracy and traceability is key – where did this number come from is a common question”.

But, and there are quite a few ‘buts’, it is clearly not all plain sailing:

So good news – no one thought they were “downright obstructive”, on the other hand no one thought they were “easy to work with, open and collaborative”. Then again there’s an argument that being “professional and diligent, but hard to read and not always easy to work with” is exactly what Finance should be.

Most of the comments reflected a frustration where Finance appears to prevent or slow down progress, but underlying that there was a, sometimes begrudging, recognition of their role and the reasons why they are there to sometimes do just that. A good example:

“I have worked with several finance teams and most have been good. Some are keen to change, some are like pulling a dead horse. They are very critical and I often find pessimistic and reluctant to change ways of working. This is however due to the importance of the work they do and the impacts of getting it wrong.”

And this comment:

“IT departments, HR and Finance are all internal ‘corporate services’. IT is typically most interested in being seen as customer-focused, providing a good service. Finance don’t care/ don’t get feedback/ don’t ask internal customers what they think of finance processes or how they could be improved. It’s very much: that’s how it works – lump it. The problems on projects are often this tension – IT (and business change) trying to treat internal colleagues as customers of a service, and Finance acting as a department, not an internal service provider.”

Some common threads start to emerge. Finance is seen not necessarily as a blocker, but a stakeholder who does add friction, sometimes necessary, sometimes not.

“If I had to apply a general demeanour, I’d say that Finance stakeholders tend to be more guarded, have a much-higher attention to detail and appetite for granular feedback. This can be a hindrance to working at pace.”

“Finance professionals are normally not concerned with considering or promoting user experience, but normally are focussed on being risk averse rather than risk tolerant in approach and adhering to financial constraints and regulations.”

And these speak for themselves:

“I’ve worked with finance teams in FS spaces, and often it’s been slow and painful and they tend to not see the wider picture”

“Finance colleagues always want to say “Yes, but…” and try to stop innovation and new ways of working.”

These speak to challenges between professionals that will arise in any economic climate. But when times are hard, budgets are under so much more pressure that the temptation is always there to prioritize projects promising short term cash flow gains over the ones that initially cost more but have the potential to meet longer term strategic objectives. 

There is no silver bullet, just as there is no simple solution to most of the issues we face when delivering transformation into complex organisations.

However working well with Finance stakeholders really matters in our world where our mission is to help Transformation teams succeed. Our survey confirms that there is often friction, if not conflict, between the finance interest and the transformation interest and highlights some of the underlying causes.

But there is more, and it is this. Everything we do at Herd is Human centric. Dealing with Finance may be about numbers – but it is still about people. In this case people who have different drivers and approach from the rest of the organisation. Finance does see things through a different lens. Or language. Business improvement people may tend to think about processes and flows. Technology about requirements. Finance in the granular detail behind a number.

The message is that in this era of heightened financial stress it is more important than ever that Finance is engaged and aligned with Transformation objectives and goals. 

We approach this by bringing together the right mix of skills and expertise to any scenario, including financial. Ultimately it is the responsibility of Leadership to set the tone around ways of working together – especially not to tolerate a blame culture – and to ensure that the respective stakeholders are truly aligned around strategic and financial objectives. 

In our next article we will dig deeper into how Transformation teams can work well with Finance. Your thoughts will be welcomed – please message me if you would like to share your own experiences. We have presented the view from the Transformation team, it would be very interesting to hear from Finance professionals and their experience of working with Transformation teams!

---

🖊️ Authored by: Angus Sim

---