Changes in the Financial field
The new technologies are completely changing the rhythm in which a business develops and the requirements which must be met by the employees in the process of completing their daily professional tasks. Trading, business finance, accounting, profitability - these are key business factors that have major impact with the advent of the new technologies and human development.
But just upgrading to the latest hardware or installing the most efficient finance and accounting tools in computers don’t do the trick. The trick is to adopt a system or process that is enhanced to make the best use of them on a current basis. Thus, what's needed in the world of finance to deal with the changes at the level of the global professional world? The answer is Agility in mindset, processes and at the level of teams.
An overview of Agility in Finance
Agile Finance is a system of various functions that work together to ensure two things:
- Lead a business profitably even during times of uncertainty;
- Creating value in a highly digitised world economy.
In order to achieve this business model, two things are required: adaptability to change and an Agile mindset, guiding an Agile finance leader who is further responsible for strategically guiding a business.
Some of the key characteristics of agile financing are flexibility, alertness, adaptability, efficiency, resilience and profitability.
Why Agile in Finance?
Here are the micro-level benefits of switching to this financing method:
- Enhanced Decision Velocity – Smaller groups of people called scrum teams are responsible for analysing and resolving problems unique to their particular area of finance or accounting. These teams work cross-functionally, which means they may work on different concepts but are always in tandem, by having regular meetings with each other. Thanks to this continuous and detailed monitoring of various business aspects, there are better control measures, decision-making policies, and governance policies in place.
- Equalisation of Data – One of the biggest challenges faced while making quick decisions is not know which source of data is more valuable or right. With the help of agile finance techniques, a unified source of “truth” is established. This is formed when finance, accounting, and IT teams work together to pool data from various underlying applications, using a detailed and thoroughly vetted IT infrastructure, and creating one set of data that has all the pertinent facts.
- Simplicity – The more complex a process is, the less flexible it is. Complexity in other words is the antithesis of agility. A sound finance system of any business involves several people in processes, in analysis of data, and decision making. Agility on the other hand entrusts decision making to only a few people, but making them more accountable at the same time. One way to save time in decision making is to increase transparency in decision making processes, which can then help with automating the approval processes where feasible.
- Creating Finance Leaders – Analysis of agile finance leaders of various companies has confirmed that they have two key traits: (a) they can manage a workforce very well such that the manpower is skilled yet easily substituted when required, with optimum usage of cloud-based ERPs to improve the process (b) they are highly knowledgeable which makes it easy for them to centralise and migrate various processes to shared service centres, thus reducing the tertiary workload on the business and increasing focus on its real goals.
- Efficient Resources Management – Agility involves rapid and correct responses to opportunities and threats by required resources. Large organisations find this especially difficult because it involves finding the right people, cross-training, sourcing resources from outside, etc. With agile financing methods, there are checks put in place to ensure such sourcing and checks happen quickly.
- Enhanced Skill Sets – Traditional accounting and finance team members are required to enhance their skills in an agile environment if they want to continue with a business and prosper. In addition to the traditional methods, they need to learn other technologies such as IoT and robotic process automation (RPA) in order to make the best use of finance-specific technologies to so their work if done quicker and in a more effective manner.
Keep in mind!
Agility is fundamental at the level of financial teams, where organisational skills must be performed at their best, assuring the growth of the business.
Get your Agile in Finance training right here and meet your new professional requirement with confidence!
This article is part of a bigger topic called Agile Project Management.