In the rapidly evolving world of finance, transformation is often driven by cutting-edge technologies and a focus on efficiency. However, as Lauren Pritchard, Senior Marketing Specialist at VantagePoint Training, highlights in this insightful guest post, one critical element is frequently overlooked: training. In her article, Pritchard explores how failing to invest in comprehensive training can derail finance transformation projects, emphasising that success hinges not only on advanced tools but also on equipping your team with the skills to adapt and excel.
Why overlooking training may jeopardise the success of finance transformation projects.
The world of finance is undergoing significant change, driven by innovative technologies and an increasing focus on efficiency and value creation.
The concept of ‘finance transformation’ encapsulates this shift, involving streamlined finance functions, new and more advanced technologies, and enhanced decision-making capabilities. However, despite the potential benefits, many finance transformations fail to achieve their full potential. Indeed, current estimates suggest that 70% of digital transformations do not succeed, a statistic that has remained consistent over the years.
Why finance transformations fail
According to studies conducted by AICPA and CIMA, one primary reason for this failure is the "lack of buy-in and inadequate capability due to scarce training across the organisation.” Transformation project leaders must understand that true finance transformation extends beyond technology adoption; the role of people and the role of training is essential for success.
What is finance transformation?
Finance transformation is a strategic initiative driven by CFOs to reshape their departments and generate more value for their organisations. This involves re-engineering finance processes to enhance efficiency, reduce workloads, and improve decision-making capabilities.
Technology plays a central role in this transformation, with artificial intelligence (AI), machine learning (ML), robotic process automation (RPA), and advanced analytics revolutionising finance operations. Manual processes and reliance on spreadsheets must now give way to ERP systems and automation, streamlining core processes, enhancing accuracy, and ensuring regulatory compliance.
But remember, finance transformation is not solely about technology; it involves redefining the finance operating model, evolving business processes, and reimagining the roles of the entire finance team. This holistic approach is essential for successful transformation.
A traditional finance function is often transactional, insular, passive, backward-looking, and risk averse. At the end of a finance transformation project, the finance function should be more collaborative, strategic, forward-planning, play a leadership role, and actively seek out opportunities. Simply put, they will be adding more value to the organisation.
The changing role of finance functions
Traditional finance functions tend to be transactional, insular, passive, backward-looking, and risk averse. Post-transformation, the finance function should be more collaborative, strategic, forward-planning, play a leadership role, and actively seek out opportunities.
Simply put, the function will be playing a leading role in and more value to the organisation.
Training: the missing link
While a well-planned project and the implementation of new technology are essential to success, transformation will only truly be achieved if team members are properly upskilled. Without competent team members who can effectively work to embrace change, positively influence their colleagues, and utilise advanced technologies and analytics, even the most sophisticated tools would be ineffective. A positive team mindset is key, enabling everyone involved to become more proactive and influential.
Yet, training is often overlooked. Some finance transformation projects do not include a budget for training, jeopardising their success. Others start with a training budget, but allow that to be squeezed if project costs increase. The statistics tell us however, that there is little point in transforming your technology if you are not prepared to transform your finance team as well.
Training for effective finance transformation
Studies have also revealed that resistance from the workforce poses a significant challenge to transformation projects. It is therefore critical that effective change management strategies address both technological and human aspects, acknowledging emotions, fears, and apprehensions associated with change. Strong leadership is necessary to inspire teams to embrace change, learn new skills, and adapt to new ways of working.
Key takeaways
Training is vital component of a successful finance transformation. As well as developing excellent people management skills, finance teams must gain the skills to leverage new technologies effectively. High quality, relative training will help to combat user error, inefficient technology use, and resistance to change. To fully harness the potential of digital finance, organisations must heavily invest in training their teams on new technologies and ways of working.
And training should not be limited to the transformation project alone; it should become a core part of the finance function’s ongoing strategy. To thrive in the evolving finance landscape, organisations must cultivate a culture of continuous learning and adaptation. This involves regularly updating the team's skillset, promoting learning about new technologies and industry best practices, and fostering adaptability to navigate regulatory changes and evolving business practices.
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