3 December 2020

The Changing Mandate of Finance

by Rachelle Lee

Digital technology is disrupting every facet of work, including finance. Finance experts are starting to see the new possibilities that technology offers. There are so many new ways to create scalable, customized solutions. Finance has a chance to expand beyond the role of accounting and play a bigger part in an organization.

Digitalization is no longer an option, it’s a given. Yet what is holding organizations back from making change?

To learn more about this fascinating topic, Rachelle Lee spoke to two industry experts. They are Tim Wieringa, a Singapore-based consultant for Digital Transformation and Operational Excellence at Hive17 Consulting, and Michael Zimmel, founder of Volve, the integrated expense management and payment card solution, and finance collaboration tool for remote teams.

Among others, the discussion touched on the following topics:

How The Right Questions Help Teams Embrace the Future

Change can be unsettling. Organizations have the responsibility to empower their employees to adapt to these changes. Leaders must present automation and AI as useful tools, not a threat.

To help organizations move forward we must ask the right questions. Tim is an expert on empowering employees to adapt to changes like this. He coaches executive teams on concepts like Design Thinking. As a consultant, he pushes teams to dive deep into understanding their customers.

Tim encourages his clients’ teams to ask questions such as:

  • Who are your actual customers?
  • What are their challenges?
  • What decisions do they need to take?
  • Which assumptions about them do you have?
  • What keeps them busy?
  • What are their underlying needs and how can we create value for them?

The answers are often not simple or straightforward. Also, the team must consider the interests of all external and internal stakeholders.

Tim uses these questions to help the team address the next level of thought. The main focus of his questioning is always around how to create as much value as possible.

Shaping Transformation: Design Thinking and Business Model Innovation

Rachelle spoke to Tim and Michael about industry changes and how organizations adapt. Here are the highlights of their conversation.

What would you say is the biggest barrier to digital innovation?

Tim: Mindset. Telling people to try a new task is easy. Telling people to change their conviction is hard. To get people to evolve and change the way they work, they need to believe in a new way. They need to change how their mind is set.

How does changing working practices translate to Finance teams?

Tim: The process of trying to create value for customers is a journey. Situations are changing in business. We often hear proprietors speaking of how operations are being disrupted. We must adopt an agile mindset and focus on customer value.

When it comes to evolving the function of Finance teams, we need to experiment and learn how finance can contribute to the business. It is this exploratory journey that will transform how finance is providing services, how they position themselves, and it will transform the mindset of people.

The importance of finance leaders in companies will increase as they are moving away from just juggling numbers, which has held them back for far too long. Just think of all the information that flows through finance, and what you can do with it!

Michael Zimmel

So where do you see finance departments on this journey today?

Michael: When employees are asked how they are rating accounting services and how it impacts their daily work, the feedback I got has not been encouraging.

During periods of budgeting, everyone involved feels “crushed” under the burden of just carrying out existing processes. Expense reporting is seen as a necessary evil – at best. And in times of bonus payouts, human resources professionals struggle to get the right data for making important decisions.

Adhering to conventional long lists of accounting procedures and regulations further frustrates and disengages. In these situations, we do not hear of finance teams contributing value to the business, making work processes smooth, or enabling other departments to achieve results not possible before.

How do you see the role of the finance leader changing in the future? How can finance leaders step into a more valuable role?

Tim: Most finance employees DO want to create added value for the business. They feel they can do more than just “crunch the numbers”. Many CFOs see themselves as business partners rather than mere accountants on a higher level.

Michael: Without doubt, the importance of finance leaders in companies will increase as they are moving away from just juggling numbers, which has held them back for far too long. Just think of all the information that flows through finance.

What can we finance employees do to contribute more value to a business? Be a bridge-builder! Break the silo! Anyone can build a bridge and there is no excuse! You don’t have to start with building a Golden Gate Bridge, but every small connector you put into place is a step in the right direction.

What do you see to be the key challenges ahead?

Tim: At the start of any change, everyone involved is excited to join this new line of thought. Yes, we are doing something new and different; let’s give it a try. But soon, obstacles come in our way. We realize this new mindset is not easy to achieve; we seem to be facing resistance from all sides. Our brains are always trying to keep us within a comfort zone.

We cannot go around telling people: now, go, create customer value. We are dealing with people, humans with different backgrounds, skills, experiences. In order for this change journey to be a sustainable success, we need to motivate the people – create a drive from within.

To get started with your business’ transformation journey, start small. But start with a pervasive task that is valuable to the whole organization.

Tim Wieringa

How can companies help to create this new mindset and sense of motivation?

Tim: Without going too deep into the technicalities of neuroscience, establishing new mindsets is literally about rewiring our brains. We achieve this by adopting new tasks and establishing them as new habits. This forms a new path of neurotransmitters, which then creates a new learning process in our mind.

What are these new tasks? To enhance customer centricity, we can start with routines directing us to create an empathic understanding of our customers. In this context, it will also be important to stay flexible. We suggest engaging regularly in experimentation in safe environments.

Being exposed once to these tasks will not change much. It is important to create new routines to frequently engage in these tasks.

In most cases, it will take some time to see the initial results. Therefore, two things are vital. First, we need a purpose, a “why we are going down this path.” And second, it is important to start small, step by step.

Recommended reading: Finance Business Partnering: The Collaborative Frontier

What is your advice for businesses that are getting started on their transformation journey?

Tim: Start small. But start with a pervasive task that is valuable to the whole organization. The collaboration will help facilitate the people who are not only customers of the process but who are also responsible for enabling the process.

Tackling a change journey as one large project can lead to many issues, barriers and failures. Frustration will set in. Success will become more distant and, in the process, targets would have shifted.

The benefits of finance automation are pretty clear, particularly in the area of highly structured activities such as the collection and processing of data.

Tim Wieringa

In your experience, what is the best place to start when it comes to implementing change?

Tim: During change journeys, the best results are seen when people feel great and safe in an ambitious environment. This is why starting in a small area where we can experiment, learn quickly, and get fast results is recommended.

For the finance department, this small area can be expense management and better handling of out-of-pocket expenses. Within this easy topic, we can quickly accomplish many benefits for a broad range of stakeholders.

Start with a limited group of people. Try it on a small group of people who travel a lot, for instance. Get user feedback and use these insights to improve the formula before moving to a larger audience.

What recommendation would you give to team leaders and managers for igniting change? What advice would you give to team members?

Michael: If you are in a team leading or managerial position: Instill a customer-oriented mindset in the finance team and teach them to always focus on the needs of the business.

If you are not in a leading position: Take initiative yourself and maximize your interactivity! Promote the impact finance can make to other departments.

Each month take one topic, analyze the information that you have access to, and exchange thoughts with people from other departments.

Sounds great! What would that look like?

Michael: For example, you could spend one month discussing receivables and the development of ageing, as well as the different metrics used among cohorts of customers. Then, the next month you could focus on payables, or your view on the effectiveness of marketing spend. Or, you could focus on ideas for quick savings, or analyze elements of gross margin.

Whatever topics you choose to cover, always be humble when discussing these subjects with others. Don’t expect to have the full picture! It should be at least 50% of you learning about that topic from a non-finance view.

Often the issue with finance transformation is perceived complexity and fear of people losing their job. At the contrary: Automatize the boring stuff, move on to more value-added tasks, and your job will be more secure than ever.

Michael Zimmel

What are the benefits of finance automation? What tools should companies be introducing?

Tim: The performance benefits of finance automation are pretty clear, particularly in the area of highly structured activities such as the collection and processing of data.

Businesses should embrace the opportunity for their workforce to benefit from this. This will include rethinking current work practices and engaging more comprehensively with technology towards more meaningful work.

Michael: Introduce tools that your non-finance colleagues appreciate. Making this a reality means equipping a capable, agile team with the tools they need. So, this era demands an online expense management system.

This is the idea behind why we developed Volve. Our ultimate goal is to make everyone’s life easier.

Recommended reading: Keep Calm And Let Finance Automation Kick Out Chaos

What about the fear many employees may have of losing their job due to finance automation?

Michael: I have many times observed the difficulty in digital transformation in finance and accounting. Often the issue is perceived complexity and fear of people losing their job.

At the contrary: Automatize the boring stuff, move on to more value-added tasks. Leverage your unique strengths and your job will be more secure than ever!

Conclusion

As technology changes the finance industry rapidly, there are so many opportunities to disrupt and do things in a new way. Although change can be unsettling, organizations are responsible for empowering their employees with the right mindset to approach these changes in a positive way.

By asking important questions and putting the focus on delivering value to customers, any team can adapt and evolve in an agile way. Of course, challenges are inevitable. But with the right approach, processes and tools, organizations will be better equipped to grow and thrive.

Time to get started

Volve is built with igniting positive change in mind. Our corporate card comes with an automated expense management solution and reporting tool. This enables all functions of business to capture productivity growth potential from time-cost reductions, greater accuracy, increased visibility and control.

From sales to human resources to finance operations, management can look forward to shifting resources from repetitive manual practices to realizing strategic goals that create more value and deliver higher returns.

Test drive Volve today for 30 days FREE. No charges until after your free trial; cancel at any time.

Rachelle Lee
Growth Hacker
Prior to scaling next-generation financial services, Rachelle lived out of a suitcase across Asia working on a 3-year research plan gathering customer insights and synthesising consumer decision journeys for global creative agencies, engaging with businesses on growth marketing, brand storytelling and customer engagement models for future business growth. She still drinks too much coffee, doing meaningful work with trailblazers and innovators to bring greater literacy to spend management solutions.

Enjoy a month of Volve on us!

Sign up for a free trial and experience the difference for yourself. No credit card required.