How Finance Directors Drive Strategy Through Systems
What do Finance Directors (FDs) have to do with successful projects in organisations of all sizes? They control the purse strings, but they also control what happens and when. So can you have successful projects without FDs buying into the strategy for your business?
This week I explore this topic in brief. I also ask you to tell me what you love and what you hate about Excel and ask, is it all over your business?
"how vital it is to plan, 1, 2, 3 or possibly 5 years in advance for your systems and how pivotal a role the FD plays in that discussion" [RB]
"Excel. Like it or loathe it, it’s there in our organisations and it plays a large part in both finance and general administration processes for all of our departments" [RB]
"Systems get to end of life and need to be replaced, it’s natural to postpone these activities for as long as possible often due to BAU concerns. So work these into a strategy." [RB]
projects, systems, finance directors, richard, strategy, finance director, deliver, excel, order, vital, compliance, business, week, resources, budget constraint, insight, regulatory obligations, discussion, chief risk officer, general ledger
Richard Bown 0:00
This is automation for the nation. My name is Richard Bown and this is episode nine. I can't believe we've got to nine already. It's going very quickly. If you have a moment, it would be great if you could give me some feedback and let me know what you like, what you don't like, and what I can do some more of, you can reach out to me on Twitter at Richard W Bown that's B O wn, or email me me at Richard W. bown.com. I'm looking forward to hearing from you. This week, I had a great chat with a good friend of mine, about what he considers to be the key elements of change management for Finance Directors. Why are Finance Directors important? Well, a couple of reasons. But mainly they hold the purse strings to the projects that you or anyone else wants to run Plus, they should be in charge or at least deeply involved with the multi year strategy of the business. And systems, of course, are vital for that journey. So in our call we discussed the following are pretty it's just about helping Finance Directors get the right numbers, is there generally confusion about which tooling and systems to have? Is it budget constraint? Or is it something else which causes the majority of problems with delivering projects on time and on budget? How often do projects get real engagement in the business and other topics? It's always interesting truths. Firstly, projects do come to the finance director for approval. And there's always too many to choose from a choice has to be made, you might have a stack of two or 300 projects. And if you're doing things right, the choice is determined by the strategy that you have in place for the business. And the strategy could and should look three to five years into the future. However, if you don't have one, how do you understand which projects you need to run? This confirms something that I've observed that projects in isolation do nothing really than waste time and money. The linking pin the linchpin between the product and the business is and could be project sponsor. But without that project fitting into a strategy, then there's little hope for it to be a success on completion. The strategy is something that you come to together, but the finance director will be crucial in setting this because essentially all IT projects are going to feed into the general ledger at some point, there's going to be a record in there of costs associated with them. Even if it's licence costs, if they're just in operational mode. That means that it's in FTEs interest to make sure that everything gets done. But also everything gets done in the right order. And of course, on a yearly budget cycle, some things are going to fall off. So what are the challenges that FTEs face in choosing whether or not to run a project if they have the ultimate decision? Well, there's a few. Firstly, resources, resources are always scarce from the experts who need to give up their time to help design and build the system. So the subject matter experts to the developers they work alongside whether they be internal or external, it's hard to find them. Secondly, business as usual concerns and timing. Business as usual means of course, running the day to day everything's we need to do this week, this month, this quarter this year, there's always something going on, there's always a rush on for year end month end quarter end, spending time standing still why something isn't implemented isn't possible. Therefore, building a system has to happen in parallel to other activities. And then the user acceptance testing, the UA T period needs to be factored in. Thirdly, Lifecycle Management Systems gets end of life and need to be replaced. It's natural to postpone these activities for as long as possible, often due to business as usual concerns. So these need to be worked into the strategy for the year or for the planning as long as it takes work out where your systems are ended life and work those into the projects to close those systems to decommission those systems, but also to bring new systems online to replace them. Fourthly, Risk and Compliance sometimes without a dedicated resource, for example, there's no chief risk officer, then how do you know what projects you must do in order to deliver on your regulatory obligations? But also and answer any audit questions. Risk and Compliance is an area which can also fall into the remit of the finance director
because perhaps there's no one else to do it. Therefore, when it comes to selecting a balanced portfolio of projects, the ones that deliver vital regulatory and compliance insight must always find their way onto the list. There are more concerns of course, not least finding the money to do all of this. However, what I found fascinating from our brief chat is how vital it is to plan 123 Or possibly five years in advance your systems and how pivotal a role the FTE plays in that discussion. Some other things that I've been toying with this week include Excel, like it's a loaded, it's there in our organisations and plays a large part in both finance and general administration processes for all our departments is a good thing, or does it point to a lack of systems or a lack of ambition or strategy with systems? I've compiled a short questionnaire and I'd really love your feedback on how you use Excel, how it fits into your systems landscape and how advanced you are with it. I want to find out how good you are with using it. I'll compile the results into report, which I'll be sharing in due course, but this will give me real insight And hopefully you too, into how endemic Excel is in our environments. And whether that's a good thing or a bad thing or just something we have to live with. One more thing, Big Bang transformation projects, ones that promise the world and you either don't deliver, or it goes spectacularly wrong. Have you ever been involved with one? I have several. Sometimes it's been a project which has gone wrong during the implementation. Sometimes it's been a project which is delivered but then hasn't been used and has to be scrapped afterwards. I'd love to hear your thoughts on projects that you've been involved with some good, some bad. And yeah, just reach out, get in touch. I'd love to hear from me. Just a reminder that you can find me on LinkedIn, Richard Bown B O wn, or on Twitter, at Richard W Bown or email me at Richard W. bound.com. It's been a short one this week, but I hope you find something useful from our discussion today on Finance Directors and projects. Looking forward to speaking to you next time on automation for the nation. For the moment this is Richard Bown saying Goodbye and good luck.
Transcribed by https://otter.ai