78. Financial Transformation Live - Re-engineering your Finance Processes

 78. Financial Transformation Live - Re-engineering your Finance Processes 

Hannah Munro 

Introduction and Session Context 0:48 

Hello everybody and welcome to this month's episode for Financial Transformation Live. So, today's session is going to be all about re-engineering your finance processes. So, for those of you that don't remember, last session last month was all about how do we document our finance processes. And if you haven't yet had an opportunity to actually watch that one, then please do go back and have a look. You can access it via our LinkedIn, or you can go onto our website. We've got all of the previous episodes along with any of the related downloads. And of course, we We've got the link to sign up to get alerts to the next session where we're launching. Because we do roughly about this time of the month, but sometimes dates change depending on... It's normally within this week, but again, it can differ depending on where we're at. So, let's move on about and get started. So, coming on to the topic that we're going through today. 

Why Finance Needs Process Excellence 1:46 

So, what is the case for process excellence? So, I do think that in terms of process engineering... You know, one of the things that... that we don't do well in finance is actually reviewing processes so, finance tends to be on the end of the receiving end of processes from sales from manufacturing from other areas of the business and actually they are the custodians of data we are the ones that produce the reports that make sure everything aligns and we're responsible for the quality of what we deliver so, one of the things that I talk a lot about is the need for process engineering skills and process design skills as part of the core finance skill set so, I think it for me it's really important and that's certainly where I come it's what got me really excited about working in finance because it's not something that's talked about a lot um So, a couple of key things just to bear in mind. So, why should we have great processes in finance? So, firstly is speed to output. So, the philosophy that we have today in business is we need more, and we need it faster, right? So, output can mean a lot of things to a lot of different people. But for me, the primary piece is around reporting and analytics and insight, right? And in order for us to get that quickly, which you will very often have your boards, your department heads, your executive team chasing and asking for more information in lots of different formats and we need it quicker. But in order to achieve that, our processes need to be robust, and they need to be efficient because the speed at which we process defines how quickly we can get the information out. So, I'm telling you a lot of things you know, but this is why I focus so, much on process analysis and process design. 

Capacity for Growth and Value-Add 3:36 

The second thing is around capacity for growth and value-add. So, there's great statistics that I've shared on previous sessions and other events that I've run around how the finance role is changing. So, that transactional role or the transactional part of finance is run about 50% on average. In order for us to achieve what the business wants from us, that needs to shift because that is the space that we are going to use for those more value-add conversations, for the insight, for the business partnering elements of what we do. So, in order for that shift to happen, we need to take something away or we're going to have to spend a lot more money and resource on finance to make it work. And actually... you know, if we think about the skill set of the people that we want in finance, they're not going to be happy with doing, you know, entering data on spreadsheets. We need them to be engaged. We need them to feel empowered. And so, why wouldn't we take away this, the unnecessary administration that most finance teams have, right? So, even those that think of themselves as, you know, reasonably efficient, that have a good amount of time, there's always areas to improve. So, continuous improvement is, again, something to talk about. And it comes down to that. let's finance, you know, finances can do more, it can be more valuable, but we need to free up capacity to do so, the second piece of rank capacity is all about growth. So, if the business is going to scale, are we going to need to add more heads in finance? And do we need that? 

Consistency, Quality, and Risk Reduction 5:08 

And also, the elements and that kind of leads on to my next piece, which is around consistency and quality of results. So, one of the key tenets of good process design is that it is standardized, the more you standardised. the easier it is to get good quality because you have steps in place to allow that. So, one of the outcomes, and it's not always a planned outcome, but one of the key outcomes of good process design and streamlining is you tend to get better information, and it tends to be in a format, a better format of better quality, right? So, all of those things make the case for process excellence. And, you know, we will be doing a further session. We'll talk again about upcoming topics. But one of the key, Kate, one of the things I do want to talk about is what is the ROI of process change? Because we need to move away from just basing on how many hours do we spend on processes to cover these other elements, the capacity for growth, the capacity to change and add more value in finance and consistency and quality and all those kinds of things. So, I'm reducing risk. So, that for me comes under consistency, but it is a key element is good processes reduce risk and improve controls. So, again, the more varied you have in a process, the more likely that things are going to go wrong and people can find their way around things again. So, we're going back to why should we have good processes and that, you know, they're the sort of the top headline things you need to think about. 

Process Improvement as a Journey 6:39 

The second piece is that process improvement is a journey. So, just as you think you've nailed your processes and they are brilliant, um, there's probably, you're probably onto the next iteration of process design. So, again, this is why I genuinely believe that this is a skillset that most people in finance will do. So, um, I don't believe it's purely a consultant conversation, right? As I wouldn't doing this and talking about it, um, live on a financial life. Um, but it, for me, um, and teaching your team and building those skills within your team to drive process improvement means that you are continually developing and it doesn't have to be massive projects to drive this forward. And again, talk about, you know, some of the types of changes that you might see if you implement this philosophy well. 

Introducing the Six-Step Framework 7:27 

So, I use this basic framework when I'm talking to people about how you approach process engineering. So, I think there's some really good things, especially if it's becoming part of your day-to-day finance operation, you do need a framework. So, when we got, you know, we want to do some process improvement, and we've chosen our areas, like what is the process we follow? So, I'm going to talk you through. So, initiate. So, the first thing is you need to understand why you're doing the process change in the first place. So, a lot of people just come in, they'll analyse, shed loads of processes and then and then they never actually get anywhere. So, for me, the initiation phase is all about any kind of change. You need to set out your story. You need to set out your vision for change. What are the objectives you're trying to achieve? What is it that you are looking to get involved? Who are the stakeholders? So, who are the people that need to be involved in that conversation? What are the objectives and the outcomes that you're looking at so, that you can measure your success, right? So, it's also a great... It's a great opportunity to get stakeholders from across the organization. Because like I said, finance tends to be at the end of a lot of other people's processes, right? So, very often conversations around improving processes do involve going back to those other stakeholders, going back to sales, going back to your revenue ops team and having a conversation about how they are processing data or sending you information. So, if you can give them the heads up nice and early around the reasons and getting them on board and the value that they will receive in terms of better reporting, better quality reporting, faster reporting, then actually that change becomes a lot easier down the track, right? So, when we're actually starting to ask them for tweaks to processes, they're on board. The other thing you might want to think about as if you're leading this change, so, for those that are involved in sort of more PMing and doing the change, then you will have, say, a slightly different view. But it's a good question to ask your CFO, your FD before you start is, what are the boundaries, right? Is the option of investing in, you know, training on a system or, you know, or a new system, is that on the table so, that you're going into that process change with a could I do, right? Personally, I like to keep things as open as possible, right? I don't like to have boundaries because it limits creativity and thinking if you know that you've got to work within what you've got, but it's always good to have that conversation because if you're in a budgeting cycle where you know you've got no flex, then there's no point you going, actually, here's this amazing process, but in order to achieve that, I'm going to need a brand new system, right? So, it's always good to understand what are the boundaries and the kind of the border rails that you need to work within for your process change, right? So, that's our initiations stage. So, set out your vision, get stakeholders involved, understand the objectives and the boundaries around your mini projects and think of it like that. 

Assessing the Current State 10:34 

The second part of this framework is all around assessing the current state of play. So, if you haven't already mapped out your processes, that's a really good place to start. And I'm just going to put in a shameless link to our previous session on mapping out your processes. So, I'll pop the link in the chat as well. So, if anyone does want to go back and have a look at that, if you haven't actually just got your processes mapped, to be honest, I'd pick a couple and start there. And I for me, that's a really good first step around, you know, and it's, there's lots of other reasons. Again, I talk about those in the last session, but get your processes mapped and then understand which processes you're going to focus on. All right. So, you know, and you can prioritize based on lots of different reasons. So, you could decide based on one that's causing you particular trouble at month end that's slowing down your month end. Again, see our session on timeline mapping. I think, you know, there's a reason I've done things in certain orders. There is a logic, I promise. But going back but go with understanding and prioritizing based on impact. So, you can prioritize based on impact, based on time spent. All those kind of things can help you decide where to focus. And if you don't know, then pick, maybe pick the ones that's easiest to change or you feel like needs the most work either or. Quick wins are always a good way to prioritize. The second part of that assessing piece is understanding the problems, right? So, there's a couple of questions I like to ask when I'm assessing a process is what kind of volumes are going through this process? Because if I'm processing, if I'm reviewing a process where I have one or two points of push through that process, so, I'm only processing small numbers of transactions, then I may not be on my priority list. The second piece I might look at is how much time does this process consume within my team? So, how much time does each stage take? And the best way to do that is to watch somebody actually do the process. A lot of people will make guesstimates, and that's a good starting point. But what's really, really fascinating is actually taking a stopwatch out and watching somebody do a process. So, when you're mapping out your processes, I always say you need to validate your process after. Part of that validation, take a stopwatch with you, count or figure out the amount of time spent on each transaction, multiply that by volume, and voila, you've got the start, and I'll say the start, of a business case for process change. right but do you remember what I said earlier around business cases nowadays are more about value versus productivity right so, again topic for another time um so, yeah so, to go through figure out um obviously um how efficient that process is the second thing to ask is um. 

Analyse and Understand the Problems 13:36 

And I guess this is where we're starting to cross over into assess versus analyze. So, the analyze phase is when we're actually looking at the process and going, how well is that process working? So, one of the things I always ask people, or I like to ask people is, what do your stakeholders think about this process? So, if you're working in credit control, understanding what your customers think about how you approach credit control, understanding what your sales team feel about credit control, or your account managers think about credit control, or, you know, how does that, you know, having a look at your outcomes in terms of DSOs, etc, if it's credit control. So, understanding across the organization how your process is viewed is also really useful because, again, finance is embedded into business. It's not a standalone silo. So, we need to make sure that we're consulting with those that are involved. And it's a great way to then go through and start analysing. So, at that analyze stage, I now go through what kind of questions we ask, how we go through analysis in a little bit. But that's when we really understand what are the challenges What are the challenges with that process? Where could we improve? What options? Yep. And then we're going to decide. 

Decide, Pilot, and Implement 14:51 

So, what changes are we going to make? Defining what that new process is going to look like. Documenting it. Yep. Going back to those stakeholders and asking, this is going to be our new processes. any challenges and stakeholders can be both those that are sort of impacted by the process but also those that are doing because very often if you especially if you've got a big team you may not have the chance to get everybody involved in the process design it's nice if you can do it but practically it doesn't always happen so, making sure that you're going back to those that are actually doing the processes and getting feedback from everybody is really important because um There's no good consultant sitting there designing this beautiful process that looks lovely, super-efficient, but doesn't work for the actual scenarios that you work with. So, do make sure that you make sure you do some validation as part of that deciding phase. And then test, right? So, this is the stage. People go straight very often to implementation. Like, let's get started with this amazing new process without actually trying to run it through some examples, right? So, pilots can be very small in that they can be almost, let's take an example, invoice coming through, let's literally map it through. How would it work? What are the things we need to think about? It could be actually doing a test or a pilot on a small sub-segment or small scenario and then staging out. There's lots of different ways to pilot a process, but that gives you an opportunity to understand the shift, the change, to identify other scenarios you may not have come across or considered. And it also is a great way, and as part of that, you need to understand what is the change that you're making. As in, what is the degree of change? You know, thinking of, it gives you a chance to sort of almost test your theory, get people engaged with a few small wins, they see how nice the new process is, and then they want to make that shift. And then implementation, of course, make the change. Depending on the degree of change, I am, and if you've been on one of my sessions before, you will know this, I'm a massive believer in agile approach to process change and transformation. So, pick off quick wins, get the buy-in from your stakeholders rather than going for a big bang approach because big bangs can very often go wrong. I'd much rather make a series of changes over a three to 12-month period with increasing impact and capability where people get really engaged through each stage. You build some momentum, a bit like a snowball rolling down a hill. And then do, you know, one massive 12-month project where we map every single process across the entire organization and then press a button in 12 months and go start. Right. And that is a really, you know, the risk in that compared to the first approach is very different. So, if I have the opportunity and there are some circumstances where it's not appropriate or applicable, I will always face. That's one thing just to think about. So, that's our six-step framework. Initiate, assess, analyze, decide. pilot and then implement and follow up right um so, when I say implement I also mean make sure and you know you go back and then think about did that process change work is it working well um are we still using that new process because um again I think a topic for one I need to do is things about the change cycle so, how do we you know what does change mean why is there resistance how do we avoid it so, that would be something I will add to me to discuss list okay so, That is our six-step framework. Okay, so,... We talked a bit about this. So, our session today is very much going to be focused around the assess and analyze part of the process. I will try and do some other sessions to dig more into the implementation, piloting, ROI assessment, et cetera, so, that you guys have that information. But I have a limited amount of time, so, I'm going to try and squeeze in as much as I can for this session. 

Where to Focus Your Efforts 19:01 

So, where should you focus your process engineering efforts? So, here's just a quick summary. Time spent, so, how much time is being wasted on this process. Volume, so, if there is an area where you're anticipating a massive increase in volume, for instance, if you are starting a new channel or starting a new revenue stream and you might choose to focus on, say, your contract management because you know it's a mess already and you're going to add more volume to that. So, thinking about both current volumes and anticipated in the next 12 to 18 months because remembering there will be a leap time to get new changes in place and to do this work if you can do it well strategic priorities so, it could be that actually feedback from your customers say that your billing process is really fragmented and doesn't work well for them so, as part of your customer experience it could be that that is something you pick up it could be impact so, for instance it may be that one process is holding up your month end so, you focus So, again, there's no right or wrong answer to this. It is a bit about making a judgment call, but here are some of the factors that you just might want to consider when you're going through this process, the decision around which processes to focus on. 

Key Questions to Ask During Process Review 20:25 

So, once we've got our process, we've got it in front of us, right? And we're trying to figure out how to make it better. So, how do we approach that, right? So, there's kind of three categories of process, of question that we should be asking ourselves or our team. So, firstly is, how well does this process meet the requirements, right? So, are there any elements of that process that are not adding value? So, is there a part of the process that is not necessary? Can we get rid of it? Is there any redundant parts we can remove? How well does this process meet our requirements? So, A classic example, which I'll look at a bit later on is purchasing. So, you know, how well does it, you know, it meet the purpose of this process, which is to have digital, you know, digital controls over our purchase, you know, our purchasing and our budgets, for instance. Yep. So, asking your questions about why does this process exist? Why is it there? Controls is always a really interesting one. What controls should we have in place? So, depending on your objectives, it might be part of your objective is to have more control over purchasing, in which case you say, well, where are the controls? At what point do we need them? Are they in place, et cetera? What are the levels, et cetera? Complexity is a big piece as well. So, very often complexity appears over time. right so, as you know a salesperson has a conversation with customer and you know in order to close a deal we need to do things in a certain way so, actually um Process engineering and process design is a really good reason to go back to, well, what scenarios do we have? What scenarios do we want to allow moving forwards? How do we stop all these ad hoc things that are going outside of our standard processing? Do you need to ask whether some of your ad hoc is actually standard now? And then so, you can build process and flows around it. So, again, this is an opportunity for you to almost go through and go, what does this process need to be able to cope with? Defining that, challenging it. So, going to the salespeople and saying, actually, this usage-based model that you guys keep selling doesn't work for finance. Now we either need to invest, or you guys need to change how you're doing. How big a requirement is it? So, it's a great way to understand what parts of the require, you know, almost what scenarios are driving some of the issues with the process and questioning, do you still need that scenario? So, there's a lot of, why do we do this? That should be asked. If you, you know, you do sometimes as a consultant, I sometimes feel like a three, you know, a two- or three-year-old toddler going, well, why? Why? And if, you know, and you kind of need that person to go, why do we do that? Tell me why. Why do we have to do it in that way? And again, it's a really good habit. But here are some constructive questions that you can ask yourself about that. So, that is our requirement analysis. 

Risk, Delay, and Resource Use 23:39 

And the last one, which I think is really interesting, particularly in this day and age, is, is there a risk in this part of the process? Now, that could be a financial risk. It could be a security risk. It could be a control risk of some sort or a customer. Quality risk. But asking yourself those questions really does help to make you think about that process. Delay. So, we often talk about how much time something is taking in terms of resource. We don't always ask how much is this delaying what we're doing, right? Because things will just sit there and nothing will happen to them. Purchase invoice approval and expenses is a very good example of this. So, it might not be taking up a person's resource time, but if that item is sitting in limbo for too long, then if it's sitting in limbo, it may not be in your reporting, right? So, then you start to get some shocks at the end of the month when everyone goes through and authorizes their invoices, et cetera. So, thinking about delays, bottlenecks, and points of the process that slow things down or create challenges is really important. And of course, thinking about technology and resources and what you need to do differently to prevent those delays. And then the third piece is resource. So, is it that it's taking too much time? Is it, you know, what kind of time is it taking? Because if it's taking up your, if entering data is taking up your senior finance team members time, then actually, there are much better ways for that to be spent. And it's not just about cost. It's about the strategic value to the business. So, understanding that is, you know, thinking about is this going to impact one individual's efficiency? Is this going to drive other people's efficiency? other efficiencies? What is the impact on, if we change this, what will be the impact on the wider organization? And at every stage, you're really, really looking to automate, right? You want as fewer touch points and you want to automate, and you want to create this self-serve approach to finance, right? So, the days of people having to knock on finance's door to ask for something are, you know, are starting to dwindle and actually finance in itself is becoming more in my opinion, much more self-serving. So, people can access finance without necessarily having to pick up the phone and have a conversation. So, can people access information on demand? So, how can we give things on demand versus be asked, right? And again, I've got an example of a process which is starting to follow this flow that we're going to work through in a bit. 

A Before-and-After PO Process Example 26:29 

So, here's my example process. So, this is the first part of a purchasing process. This is the PO process. And this is actually based on a real-life example that I came across. So, before we started, so, the employee speaks to their manager, gets provisional approval, has a conversation, sends an email, however that method is, and has a conversation with their manager. Say, look, you know, I think we could do with this. What do you think, etc. They would then send an email to request a purchase order number to finance. Finance then accesses a spreadsheet and adds another number to the list, adds the person's name, adds roughly what it's about and then emails that number to the person. The person then fills out an Excel spreadsheet with the information and populates all of that information that finance needs and then sends it to the manager. The manager then prints it out, signs that piece of paper, say they approve, sends the employee back, scans it back in, sends the PDF to both that person and finance. Finance then enter it onto the system. Finance then saves the PDF that that person's filled out onto a shared file. And finally, finance then sends the PO to the supplier. So, if we go back to those degrees of those questions that we were looking at. And this is not a made-up process. This is actually based on example I came across in the last six months or so, there’s a couple of things that we can pull out here. So, firstly, the points of contact that we've got at each stage, right? I don't think anyone that's using, as a stakeholder is using this process likes that, but you've got a lot of repetition, right? So, you've got the Employee filling out the Excel form and then finance manually entering onto the finance system. So, you've got duplicates of information. Yep. You have lack of visibility through this process, right? So, the point actually, which that PO goes on is actually quite late on in that process. And if we think about the delay from when the employee has said, like, I quite like to do this manager, can you give me an idea through to when the supplier gets the approval, then that's quite an arduous process. And the problem with arduous processes is that people don't follow them. They find ways around. And then things become retrospective, which is never good, right? Because if you, you know, they'll just say, oh, yes, supplier, manager, can you just give me a rough approval? Yeah, right. I'll say yes to supplier and then I'll get the POP sorted out. It's no, we don't want that. So, yeah, you know, there's a couple of, you can quite easily see all of the different things, you know, parts of this process. There's lots of points that aren't adding value, that aren't, you know, delivering value to the organization, right? And, you know, for those that are, you know, that are live, we'd love to hear any examples of processes or particular processes within your organization that, you know, this may remind you of because it's always quite interesting. I do find purchasing and revenue, those two sides of the coin, you know, most transaction heavy that tend to drive a lot of the more arduous processes. So, that's our before, right? And then here's the example, right? Employer enters a requisition on the system and sends to manager digitally through the system. The manager goes, yes, I'm happy with that. The employee then converts it and sends it to the supplier, right? So, you can see that process compared to the first one, is very, very different, right? So, we've gone through each step of that process and gone, like, how much value are these steps? Finance doesn't even need to be involved. All finance needs is a report that they can pull at any point to go, right, what's our committed costs? So, quite quickly, you can find ways to streamline, yeah, by asking yourselves this question. Is this part of the process adding value? How do I get rid of it? right? And you want to take out as many touch points and also finance being willing to let, to allow people to enter information. And there are things you need to think about in terms of validations of having got correct information. But this is a, you know, this is one example of how you could streamline. And if you think about how much time that finance person is spending typing information into a spreadsheet versus the second point, imagine how much time that could free up, imagine where they could be spending the time, and imagine how quicker, how much quicker you could get the information that you need for reports, okay? So, that's an example of how we would approach a process evaluation and assessment and putting together what we think might be the new process, okay?  

Practical Analysis and Improvement Tips  

So, key things to focus on. So, when you're doing this process analysis piece, focus on removing manual processing. If somebody is entering something, you want to do everything within your power to get rid of that entry point, whether that is importing, and there's different ways we can do imports. Again, I think another topic for another day. If there's anywhere where you can automate, so, how can you basically remove the human element of transactional processing and if you can't remove it, can you do it in bulk? So, rather than process one invoice at time, can you get payments? Can you import them from your system in bulk and just get an export and import it in? Again, we'll talk about integration because I actually think that's quite an interesting topic is integration and how you approach it. Again, it's one I'm going to add to me to-cover list, but it's really, really important. 

Empowerment and Team Engagement 32:37  

And Paul makes a really great point. Data entry... is not an exciting job to have. And actually, most people do not get qualified in finance so, that they can type stuff into a computer or type stuff into a spreadsheet. Actually, the bit they find interesting is analysing, reconciling, driving insights, right? And actually, and again, on Paul's point, the happiest finance teams and the most engaged finance teams are those where they know where the CFO and the leadership within finance really value their team's time. They want their team to be able to reach their full potential, and you cannot do that if you are typing purchase invoices manually into a system when there's thousands. So, again, there's a whole piece about why to change, but empowerment is a really big piece of that. Again, when you look at your process, Find spreadsheets. And I know I go on about this and I'm not, you know, I do. There is a time and a place for spreadsheets. But one of the key indicators that we've got issues or keyways to find improvements and time improvements, I find, is to find where the spreadsheets are in a process. Right. Whether that's reporting side or afterwards. So, it's a really good way. of figuring out. Now, you may decide that actually that spreadsheet needs to be in place, but it's a good indicator since it's going wrong. And if you haven't done an Excel audit or an Excel review, whatever you want to call it, or it has a few different connotations, then I genuinely suggest you do. I think one of the first sessions I did is running, is how to get rid of spreadsheets within your team. And I talk through a basic template for doing it and, you know, an Excel audit. So, it's well worth, if you, again, go back, Have a look at that one. The website address is on the page. Go back and have a look at that. Third thing, I feel like I've repeated this a lot, but it's worth repeating, is standardization. So, standardization of how you approve, what your approval structures are, standardizing... what criteria you're using, standardizing scenarios is really, really important. And if you can get conversations about things out of email, you tend to drive a lot of efficiency, right? Because if you think about the example of purchase invoice approvals, can you approve this invoice? Can you send me it? What's this about? Where's the PO? If you give people access to the originating information, it makes things a lot quicker. So, a lot of what we do is taking things out of email or out of verbal conversations and into a more sort of information on demand or self-service type system. And don't forget that you should also think about challenging the wider organization. So, again, if something that another team is doing is really hampering your efficiency, then make them aware, right? Have a conversation, help them understand the impact. And then as a team, as a group with the stakeholders, is you can then evaluate whether that is adding value because it's quite interesting when you start chat you know part of my job as a consultant is to challenge um and ask you know the questions that no one's either thought to ask or wants to ask in some instances um and it's quite interesting um you know some quite a few of the conversations in fact aren't actually about what finance is doing it's about what they're getting from other teams and other processes so, you It is important that you encourage your team when they're going through this process to think outside the box and to drive things forwards. 

Brainstorming and Creative Thinking Techniques 36:26 

And if you get stuck, right? So, if you're going, you're looking at a processor going, I just can't see a way out of this. I don't quite know where to go. There are some great brainstorming tools that you can use. There's two main ones that I tend to use. I told you about one earlier, which is the why. So, the why technique is amazing. So, why do we do it in that way? What is the purpose? Why do we send it to that person first? What is the purpose? Because very often processes evolve and not in a good way. So, if you've not got somebody that's doing this sort of process analysis piece on an ongoing basis or you've not done it recently, very often you will be stuck with processes that are very clunky and old. And if you get the answer, well, we've always done it this way, immediate red flag, right, let's go through what this could look like. So, ask the why. So, why do we do that? Because sales send it to the format. Why do they send it in this format? because they get it from the system. Why do they get it from the system in that format? I don't know. I need to go find out. Great, right? We have a way forward. So, you can figure that out, yeah? And if you can keep challenging on that, then that does that. And one technique you can use is what we call the fishbone diagram method. So, the problem could be revenue recognition. And then you basically pick up the areas within that that are justified. So, understanding the people impact, the formats, the sources, et cetera, and you're just going into the causes and effects of what's happening. So, that's an interesting brainstorming tool to apply. But to be honest, if you don't want to go into the technical diagrams, just asking why on each stage is, why do we do this part of the process? What value does it add to this process? It's just a really basic technique that doesn't involve much skill. It just requires you to focus on being a toddler, right? And I'm sure there's a few parents on here that will want to understand exactly what I mean by that. Another technique you could do is if we doubled in size, you could do, if we tripled in size in the next month, how would we cope, right? And it's quite interesting. What choices would we have to make? Because you cannot get another staff member in place in a month. So, it just makes people think about how you do that. You can also do some other weird and wonderful creative thinking. Say, if you were this person and you gave them this problem, how would they think about it? So, it's just about bringing creativity to the thought process. process. So, again we don't often ask finance people to be creative, but this is a great way to allow those creativity muscles to flex is in this. Another way you can approach it is actually going what does the best practice or what does good look like? So, actually going straight from all right I know this is the process but what do we want the process to look like? Let's ignore what we're currently doing, just go straight to the end result. So, what do we want the process to look like, right? And you can get that process from best practice. You can speak to a colleague in another finance organization, ask them how they do that. You can speak to a consultant on your software and ask them, how does it do that? You can be proper cheeky and go onto a demo of the software that you are using and see how they talk about your process. And what that allows you to do is then challenge, well, why don't we use it in this way? And that again, the why, is really interesting because most of the reasons people use software in a badly configured way is because of things, a decision that somebody has made at some point in time, right? And if you're moving away from best practice, then you are going to have impact. So, it's always interesting to understand, right, how is this software that I'm using or how is this process supposed to look Right. And then running your scenarios and your current process and matching it against and doing a gap analysis of where are the differences? Why do those differences exist? Is the reason for those differences still valid? OK, and then you can talk about solutions. You know, you can always go out and speak to a person, you know, a technical expert in whatever process you're looking at or your software to figure out, do a bit of research about how it can work. But here, that's just a few ideas to get you started. OK, so, yeah. 

Top Tips for Running Process Engineering Projects 41:16 

So, Top tips, right? So, firstly, focus on the processes that matter. Don't try and re-engineer every single process in your finance organization because you'll spend more time analysing rather than seeing change. So, Quick wins are a really good way to go. Prioritize, focus, and get some changes, get some wins, and you'll see that snowball effect start to roll through. Split the load. Do not just give one person in your organization ultimate responsibility. Think about who owns the process. Get, build, process, change teams, you know, get stakeholders at different levels involved. Make sure that, you know, if you're mapping out both the existing and the new processes, that it doesn't always sit within one person. I really do believe that you need to get individuals that are actually doing those processes involved. And it's a great, you know, it's a great development opportunity for different people. So, it's a way to engage people in the change process on an ongoing basis, schedule regular time for process workshops. So, this process that we've looked at today is quite a deep process, right? But this process change doesn't have to be, we're going to change this entire process, right? Ask, you know, on your monthly finance meeting, go look, you know, is there any pro, you know, when you're thinking about your day job, have you thought of any quick improvements that you could make? Yep. And start to get people thinking about it, bring process improvement, efficiency improvements to the fore. And, you know, just as much as you will talk about, you know, how we did in terms of month end, how could, you know, when you talk about your month end, brilliant guys, we hit it in, you know, eight days this month, how can we get it to seven? What changes would we need to do? And then that just creates that culture of continuous improvement and then allows, it means that people will be more likely to spend time on the bigger process improvement projects. using processes to drive discussion and change because like I said it's not just about what finance is doing very often process it may drive change around what payment providers we're using what banks we're working with etc so, you know think about like what is there anything that's off the table when you're looking at it and you know make it a part of your you know your monthly conversations with the team and document as you go so, I'm again I talked about this online process mapping session we did last time but you know as you're going through it make notes on a digital documentation like the points work you know do we need this scenarios do what do things digitally because then you're not spending time writing up the discussions you've had you're actually spending time on the improvements and the brainstorming instead which is good because you if people are going to invest the effort in doing this you don't you don't want to waste it you don't want and the worst thing is saying, well, we've had this conversation before and nothing happened. If you are going to do this, you need to implement the changes that you talked about and make sure you're pushing through. And again, that's why I say start small and then roll it as a snowball because it does, once people see that their ideas around process chain are implemented and actually driving value, then they'll do more of it and they'll start giving back and you create this great continuous improvement culture. So, if you're going to run the process and ask this session, I'm a nominator, facilitator, and documenter, right? Who is the person that's taking notes and doing the digital documentation as we go? Who is the person that's going to help facilitate the conversation, pull us back if we're off track, ask the why, you know, all that kind of person. Who is going to be that person? It doesn't have to be the same person for every session, but it's, you know, it's an important role. 

Best Practices for Workshop Setup 45:15 

Clearly identify start and end points. You can always extend the process once you've got the start and the end points that you've already agreed, Matt. Please do not go in and go, we are going to go, we're going to review every single process in purchasing in one hit, right? Because you will all be mentally and physically exhausted and you may not be as impactful as you would like. So, be really clear on what you're going to be analysing. And, you know, that's why I say process mapping to start with, especially if you're not an experienced process engineering team, as it were. Like as a consultant, I can, in some ways I can do it on the fly because I've done it for 15 years. But it's a lot harder if this is not your day job. So, that's why I like people to have process maps to start with. Before you start, make sure you're clear on what scenarios you have within that process, because people will design processes and then go back and go, oh, we forgot about this particular billing scenario or this type of invoice. So, just make sure before you start, you've got, you know, like we said, the initiate, you've got clear boundaries, you've got your clear objectives. And for that process, you know what scenarios are that you need to hit. Like I say, map out and validate. Validate is really, really important. Don't start redesigning a process where you haven't actually checked that what you're looking at is actually what you do. because validation tends to pull out extra steps. It pulls out and it tends to pull out extra scenarios. So, it is an important step. And again, it's an opportunity to do that time mapping that we talked about. 

Avoiding Creative Restrictions 46:49 

And five, try not to take things off the tape, right? So, Boundaries are good, right? If there are absolute no-no’s, you know, absolutely we cannot change this output because it's required for our governance or something like that or et cetera, then, you know, that's fair enough. But try not to restrict your team because if they're going into a conversation with a known restriction, it does hamper creativity. And process design is as much about creativity as it is logic and analysis okay so, you want people to think outside the box you want that blue sky thinking rather than going and say these are all the things you cannot do right um focus on the discussion right the discussion is really important but try to document as you go that's why I say if you have a nominated documenter maybe a new member of the team it's a great opportunity for them to learn they can be the documenter as you go okay um and then make sure that you run processes back and revalidate. 

Continuous Improvement and Implementation Culture 47:50 

So, any process changes, run them past people who are actually doing the process to make sure it's going to work and genuinely listen to what they're saying, right? Because again, when you've, get into the change cycle conversation, acknowledging and making sure you've understood people's objections to a process, or concerns is probably a better way to phrase it. It means that when you implement the change, it's going to be a lot easier. And also, you're less likely to have missed something. Okay, so, going back to our six-step framework, initiate, assess, analyze, decide, pilot, and then implement. 

 Wrapping Up and What's Next 48:29 

Okay. So,... So, just to say thank you to everybody, obviously, for joining me today. You've done well if you got to this point. It's been almost now. These sessions do feel like they're getting a little bit longer. But I'm really genuinely hoping this is adding value to yourselves and giving you food for thought. That's all I want to do is try and give people some food for thought, maybe make some impact in terms of how people are looking at their own processes. Like I said, and I have said about process mapping, you don't need huge amounts of technology to start this conversation. And actually, this is a brilliant skill set, both in terms of people's development, but also in terms of really creating that value-added finance team, which is what I do. So, we are actually thinking about adding to this format. So, obviously, we've got these monthly presentations where it's very much me presenting and you guys feeding in. Like I said, if you have any questions on anything we've covered or some areas you'd like me to spend some more time on, please pop in the chat. If you haven't connected with me on LinkedIn already, please do and send me a message with anything that you guys want to focus on. To be honest, I love feedback. It's very strange for me to just present without people coming back. Thank you to all those commenting at the moment. If there's a particular area that you want me to focus on for another session, then let me know. I'm thinking about doing some like midway FAQ sessions. So, if you have any questions, even if it's generic or a particular process that, you know, or a particular challenge that you've had when you try to implement these skills and these frameworks, then please send them through. My email address is on the PowerPoint. So, send it through to me directly. Or if you prefer, just DM me on LinkedIn, right? I'm pretty, you know, I'm on LinkedIn a lot because I'm sharing a lot of content. So, please do. If there's any, like I said, any questions, difficult scenarios, send them through. If anyone would value maybe a one-hour consultancy call talking about any particular problem that you have, particular process that they want to do, I'm happy to offer a free consultancy session if I can then publish that as a video to help people work through some examples. Because I think sometimes when you've actually got an example to work through, it's a lot easier. So, please do DM me if that's something you'd be interested in. My specialty is, of course, I'm particularly sage intacct, but I've also spent a number of years working with 250. And also, a lot of what I do is product agnostic. So, if you're on zero and you want to run some stuff past me, I'm pretty sure I could at least get you going in the right direction. So, please do reach out. And the upcoming topics that we've talked about, so, big one, I've had quite a few people message me about communicating and calculating ROI for change. Well, and change can be obviously processes, it can be technology, but actually we're going to do a session. So, I've got a podcast coming up with the ACCA on that. So, if you, you know, obviously listen to that, but I'm actually thinking about putting together a, you know, a more detailed session. Next one, which I'll go on to at the dates and it's all about redesigning your chart of accounts because for me it's one of the areas where I go into a lot of setups and people have just totally over engineered the chart of accounts so, we can talk about a framework that is non-product specific that allows you to redesign your chart of accounts and get it into a future-proofed and useful format um And there's a few other topics there. So, things about integrations, how to design and plan it, what questions you should be asking, all of those kind of things. And putting together requirements documents, how do you approach it? So, I've been on the receiving end of some really great requirements documents. I've actually seen a few where I've gone, that's just not how I like to work, and I can't really add value in that. So, how do you put together requirements documents that de-risks the process for you as a team, but also means you get the right kind of partnering involved. So, if any of those would be valuable, then please do let us know either in the comments or DM me. I really don't mind. But it'd be great to get some feedback on where we should focus our next session. The next session, as I said, is going to be on the 24th of May, slight change in time to 1pm, just to point it out to everybody. If you want to sign up to that, I'm just going to pop the link to our website on. So, if you go onto our website, you can get a copy of the PowerPoint from today's session, the video recording, if you want to share with the team, because we put it up on YouTube pretty much straight after, and any workbooks, which I've got a few resources for further reading that you might want to get access to. And also, if you want to sign up to our website, you can sign up to receive the next session. So, if you follow us on LinkedIn, hopefully it should pop up in your feed. Hopefully if you're connecting to me, you might see it. But if you sign up on the website, you'll definitely receive a copy because we send it out every month along with all the resources. So, yeah, so, final reading, some bedtime reading. For those that are in, you know, we are running an Excel-focused webinar on Sage Intacct about how Intacct helps you get rid of spreadsheets. That's coming up, so, you can join that. We have, I wrote this guide a few years back, actually, and it's starting to really kick off. It's got some great, it's a guide to getting started with streamlining your finance processes. So, it goes through the difference stages of analysis it goes through some brainstorming tools with some examples and we had some feedback from some great speakers on that one as well so, yeah it's again it's a nice base if you want to just kind of get the brain working around process engineering and We've got an automation webinar that's on demand and available now around Sage Intacct as well. And for those that don't know, we obviously do these sessions live, but we also publish the audio only on our podcast. And we've had some brilliant podcasts recently with the ACCA, with Generation CFO. So, please do check out the podcast on all good podcast networks, CFO 4.0. So, thank you so, much for joining us and for making your way, if you made it to the end. It's been wonderful. I genuinely really hope you found this valuable. But tell us, you know, if there's areas that you think we should change, tweak, what have you. I would love to hear from you. And thank you for those that are particularly engaging. Really great to see some repeat faces as well coming back to these sessions. And yeah, excited for the next month's session. So, take care, guys. And I'll speak to you soon.