Pressure to improve the efficiency of processes and a reduction in co-located working opportunities mean that effective collaboration between the finance and accounting functions is more critical than ever before, market participants have said.
According to Justin Meritt, VP solutions consulting at financial performance management platform Planful, a lack of collaboration can cause conflict and friction between the two functions, leading to further inefficiencies.
“What a lot of accounting and finance teams are going through is pressure to improve process overall,” he said during an Accountancy Age webinar last week. “What this can create is a lot of conflict between the two departments because there are dependencies across those two areas. And that conflict results in friction, which can be very disruptive to the accounting process.”
This was echoed by Homiyar Wykes, group financial controller at ED&F Man, who also spoke during the webinar. Adapting communication methods can be remedy for this, he argued.
“We try and speak the same language in a sense, using the same technology and acronyms. We try and make sure people are referring to the same thing. That’s very important because revenue for one of our businesses could mean something very different to what it means for another.”
Technology as a collaborative mechanism
An audience poll conducted during the webinar found that more than 30% of respondents perceive automated process to have been the most effective tool for enhancing collaboration between their organisations’ finance and accounting teams.
According to Meritt, this emphasises the value of Planful’s “financial intelligence” capabilities. The platform’s ability to interpret things like double entry means that a “common language” between the two functions can be more easily established, he said.
“Oftentimes mistakes can crop up when people forget about the other side of the entry when they’re planning for certain spends. If you think about planning for capital spend for example, which is a common scenario where a lot of mistakes can be made – having the ability to plan for things like that could be critical.”
Meritt also argued that quality increase, in addition to time saving, could be a clear benefit of increasing automation. “You’re just systematically eliminating risk of error,” he said.
Testifying to this, Wykes explained that the ability to achieve comparability and version control within a multi-national, multi-disciplinary business is critical to business continuity.
“For us technology is absolutely critical. Every time we open something centrally, we get the same information. So even though it looks different in each location, it’s fundamentally the same.
“If you’ve got the same numbers regarding location or business, that saves time because you’re not worried about version control. So I think having that central data point from using technology helps us to be consistent across our different reporting requirements.”
Gaining buy-in
Meritt also weighed in on how companies can gain buy-in from internal stakeholders regarding new tech solutions. Highlighting the limitations of more traditional methods is the key to this, he said.
“Think about exercises around planning for people costs – oftentimes those are quite complex for people because of the data involved, and all the different benefit plans and things that have to be considered. And those things start to get really difficult to do in spreadsheets.
“So a lot of the time, adoption is driven by thinking about the limitations we face. And often, you find that your stakeholders are not 100% satisfied. And usually when you open that door, they become a bit more open to the change.”
Wykes, meanwhile, argued that technology training can act as a “powerful” buy-in tool within organisations, adding that “people don’t invest enough” in it alongside technology adoptions.
“You get people on a training course and you sit and learn the common language, and that can be incredibly powerful in terms of making sure people get behind the new system. I think I learned that the hard way, because we didn’t invest in training for the first wave, and we realised that the lack of buy-in was the biggest problem.”