When it comes to a digital transformation, one of the biggest questions that CFOs ask is how long it will take before their business starts seeing the real-world benefits of the investment. This is due, in part, to the fact that not all finance transformations successfully deliver the desired ROI. As a result, CFOs of organizations that are undertaking a finance transformation are eager to confirm that all of the time and money spent has not been in vain.
The need to transition from legacy finance platforms to modern, cloud-based solutions is growing. According to Gartner, “85% of finance teams are currently undergoing or planning a finance transformation.” With finance transformation steadily becoming a priority instead of just a “nice to have,” CFOs need to take the digital leap sooner rather than later or risk falling behind the competition.
This article will look at some of the key factors that can determine the time-to-value of a digital finance transformation and some of the steps that a business can take to speed up the process.
The Time-to-Value of a Finance Transformation
Determining how long it takes an organization to start seeing the benefits of a finance transformation is extremely difficult. Company size, legacy systems, goals, organizational structure, in-house expertise, and a plethora of other factors all play a part in determining how long it will take to see an ROI from your investment.
That said, there are a few key factors that ultimately impact the time-to-value of a finance transformation.
What Factors Impact the Time-to-Value of a Finance Transformation?
While every digital transformation is unique, there are some common factors that impact time-to-value.
How Quickly You Can Make Sense of the Data
A big selling point for switching to a cloud-based financial management solution is the wealth of analytics that these solutions provide. Businesses that migrate to a new cloud-based system often struggle with the “data deluge” and have a hard time turning that data into actionable insights. Not only does a digital transformation result in more data points to contend with, but it also introduces a wealth of real-time data that can overwhelm unprepared finance teams. While the reporting features of cloud-based financial management solutions are robust, tailoring these reports to fit the needs of a business remains a challenge for many.
How Quickly Team Members Adapt (If They Do at All)
With any software deployment, success is ultimately determined by how long it takes for a team to adapt to the new solution. The sooner your team adopts the new financial management system, the sooner your business will start seeing value from the platform. People, however, are frequently slow to change and often resist it.
If employees haven’t been properly engaged during the deployment of the new digital finance solution, then the best-case scenario is that they will generally take longer to make the transition. The worst-case scenario? They only partially adopt the new system or aren’t willing to make the transition at all, preferring their own homegrown systems. As a result, getting employee buy-in at the start of a finance transformation is critical.
Increasing the rate of adoption ultimately comes down to training and culture.
Training needs to happen both during the deployment and continue even after it has finished. During the deployment process, it’s important to keep the following in mind:
- Having a strong team of advocates within the organization is essential.
- Management also needs to be properly introduced and fully trained on the new system.
Having a strong post-deployment training strategy in place is also essential, as it helps to reinforce the new business processes and workflows. After go-live, businesses need to:
- Recognize team members that successfully use the new solution.
- Correct and provide support for team members that aren’t using the new solution.
- Plan for regular training sessions that help team members stay up to date with the latest changes in the software.
How quickly your team adapts to the new financial management solution also depends greatly on company values and culture. The values that matter the most include:
- Innovation – Is your team comfortable experimenting with different processes, workflows, and solutions? Are they comfortable with risk-taking? Does your organization encourage learning from mistakes?
- Flexibility – How well can your team adapt to new technologies? Or business processes?
- Ownership – Will each member of your team commit to using the new system, reporting issues, and recommending new ways to ensure success?
Teams that make these values a strong part of their company culture will experience a smoother transformation and see ROI sooner.
How to Improve the Time-to-Value of a Finance Transformation
CFOs looking to increase their time-to-value should consider the following:
Customized Dashboards and Automated Reporting
While out-of-the-box reporting can be helpful, finance teams will get better actionable insights by using a more tailored approach to data. Creating customized dashboards to track expenses, procurement, supplier accounts, and other important data points will help to address the influx of new data and reports.
Ongoing Change Management
Change management needs to extend well beyond the initial deployment. Even if the deployment goes smoothly, teams can quickly lose momentum to sustain the change after go-live.
After go-live, additional training may be necessary to reinforce the new processes and address any updates to your new cloud solution. Additionally, there is a high likelihood that pockets of resistance will emerge post-deployment that need to be addressed quickly. To combat this, key stakeholders on your team need to make sure that they are holding their teams accountable (in addition to being held accountable themselves).
Having an ongoing change management strategy ensures that team members stay on track and that old habits don’t resurface.
Ultimately, improving the speed-to-value of a digital finance transformation comes down to a combination of people, processes, and technology. When these elements are aligned, productivity increases dramatically and businesses see the ROI of their technology investment significantly sooner. Having the right partner can help as well. For example, Virtus Investment Partners partnered with Collaborative Solutions for its Workday financial management deployment and started to see ROI after just six months. To learn more, download the case study.
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