Change Management for Financial Transformation
No matter what your business vision, values, and objectives are, a healthy finance function lies at the heart of your success. Financial visibility, reporting, projections, and strategy are the foundation of your business decisions and position you for profitability and growth. If processes and systems are outdated or dysfunctional, however, you’ll struggle to remain competitive. When you notice warning signs like process inefficiencies, data errors, data silos, or outdated technology systems, it’s time to update.
The goal of financial transformation is to align finance functions, technology, and data with the strategic priorities of the business. For example, change initiatives may include breaking down data silos to improve visibility and access across the organization, creating better systems for capturing and managing data, redesigning the reporting process, implementing new technology to increase efficiency and reduce errors, or merging systems and processes after a merger or acquisition.
All of these changes represent potential growth and improved financial performance for your organization, but they will only be successful if team members adopt and utilize them. That’s why change management must be an integral part of every transformation endeavor.
What is the Goal of Change Management?
Change management deals with the human side of change. The best strategic initiatives and tactical plans will produce desired results only if the teams responsible for implementing them are committed to new ways of working. In other words, change at the corporate level hinges on change at the individual level.
Change management facilitates the process of change by creating an intentional plan to increase adoption and reduce resistance. Strategic, intentional change initiatives can result in:
- Higher adoption rates
- Increase engagement
- Better employee morale
- Improved communication
- Better understanding of the need for change
- Increased productivity
- Greater effectiveness of new technology
The key to getting these results is to create structured, repeatable processes you can use every time you undertake a new change project. That’s what we’ll consider next.
How to Design a Successful Change Strategy
Financial systems and processes are only as effective as the people who use them. If team members don’t know how to use a system or aren’t committed to a process, they will not achieve the full ROI potential. The good news is that you can reduce resistance and help people understand and take ownership of new technology and behaviors with the right change strategy.
Here are 6 tips to help you succeed:
- Create a Change Roadmap –The change roadmap lays out the who, what, when, and how of your transformation project. It states the goals of change and documents the budget, timeline, and milestones you want to achieve. Your roadmap should include project scope, objectives, strategy, methodology, stakeholders, change leaders, communication plans, training sessions, support options, and other resources involved in the project. All of these pieces should tie back to broader organizational goals as well as your overall culture and values.
- Establish Key Metrics and Success Measures –The metrics you choose should serve as indicators that the project goals have been successfully achieved. For example, they may help you determine how many employees are using a new software platform, how productivity or profitability has been impacted, or whether a new finance model has been successfully integrated. Here are some key metrics to consider:
- Employee Engagement – Engagement metrics help you determine how change has impacted the morale of team members, either positively or negatively. Employee surveys, NPS, and one-on-one conversations with managers can all help gauge how people feel about new systems, processes, and technology.
- Training Completion – Monitor how many employees have completed training and provide support where needed to stay on target. Completed training should be a baseline for successful change. However, employees may fall through the cracks if they feel resistant to new technology and procedures or don’t understand the reasons behind the change.
- User Adoption Rates – In addition to training completion, user adoption rates show you how many team members are implementing new processes and tools into their daily workflow. These metrics may include time-to-adoption, knowledge or skill checks, and percentage of employees using a new application or system.
- Business Performance Metrics – Of course, the ultimate goal of any change endeavor is to improve business outcomes. Business performance metrics help you know whether or not your change initiatives have had the desired effect. Has the change made you more efficient, productive, or profitable?
- Involve Every Organizational Level –Change starts at the top. Organizational leaders can greatly influence change adoption rates by championing those changes and using new tech, tools, and processes themselves. At the same time, be sure grass-roots employees have adequate support and opportunities to receive additional training if needed.
- Communicate Strategically – Sustainable change happens when people take ownership of the change in their personal daily workflows. This is only possible with frequent, effective communication about why the change is necessary and how it will affect individuals. According to leading change management organization Prosci, communication should answer the question “What’s in it for me?” You can do that by addressing these five areas, known as the ADKAR model:
- Awareness – Help employees understand the need for change.
- Desire – Give them internal and external motivation to support the change.
- Knowledge – Be sure they understand the “what,” “why,” and “how.”
- Ability – Provide tools and resources to help employees develop new skills.
- Reinforcement – Provide ongoing support to sustain the change.
- Prioritize Training Accessibility – Be sure every member of your team can access training resources and materials. In addition to meeting ADA guidelines, provide options for team members who may not be able to attend in-person training sessions. For example, you could offer a video-conferencing option for remote team members, an online module for those who learn more effectively through interactive resources, and a pre-recorded video training for those who can’t attend sessions when they are scheduled.
- Anticipate and Address Risks –Every change initiative will face challenges and roadblocks. These risks can derail your transformation project if you don’t have a plan in place to address them. Here are some of the most common risks you may face along the way:
- Resistance to Change – It is common and normal for employees to resist changes to their daily workflows and habits, especially when the change feels disruptive or unwanted. Change requires adopting new behaviors, learning new technology, and thinking in different ways, all of which can feel intimidating at the outset. Effective communication is one of the best ways to overcome change resistance, along with offering support from managers, peers, and company leaders. Ask for employee feedback to identify problems or misunderstandings so you can design effective strategies to address them.
- Lack of Leadership Involvement – Gaining leadership buy-in is a critical first step in the change management process. Leaders need to understand how the change supports overall company objectives, what the costs and benefits are, how the change will be implemented. Tailor your message to the specific concerns of each leader and maintain consistent communication to keep them informed along the way.
- Misaligned Expectations and Priorities – When you have more than one change initiative taking place or multiple departments involved in the change, competing interests can create friction. Misaligned expectations and priorities often create departmental silos as leaders focus primarily on their own goals, which may inhibit greater benefits across the organization. Again, the solution to this problem is clear, consistent communication. In addition, be sure managers understand the overall change strategy, what the goals and priorities are, and how their department fits into that big picture.
Get Started with Successful Change
Change is a constant in today’s business environment, especially when it comes to technology. In the finance arena, staying on the front edge of technology innovation can deliver competitive advantage and keep your business on track even when the economy is uncertain.
At Atlantix, we understand what it takes to optimize your processes and systems for greatest impact. Our consultants walk you through the entire change process from start to finish so you get the best results. Contact us today to see how we can make your next project a success!