Managing Director, UK CCH Tagetik
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Transforming culture from blame to accountability

6th Aug 2018
Managing Director, UK CCH Tagetik
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It’s fair to say that the last decade has been tumultuous for UK plc thanks to events that are so familiar now they hardly need repeating. To paraphrase a wise saying however, you can’t change the world, but you can change your company.

This need for companies to adapt to a chaotic, uncertain new-normal explains why we are still yet to reach ‘peak transformation’. However as the emphasis is increasingly on digital and technologies like AI and big data, it’s important not to lose sight of a key transformation goal: improving accountability.

Unfortunately we most often hear about accountability in the context of high-profile corporate failures. Media coverage is often centred on who’s to blame - the CEO, the board, the IT department, a rogue trader. Outsourcing blame is a popular sport, with many column inches lately devoted to culpability of big four accounting firms.

However by the time it’s time to assign blame, the damage is already done. Many rightly point out that corporate governance should change, but this is a slow process. Ultimately public companies are responsible for knowing and acting in line with their financial situation at any given time, including their exposure to risk. When industry watchdogs witness systemic governance failures, onerous new regulation is the invariable consequence. This only heaps more misery on struggling industries like retail.

Financial and digital transformation, executed well, is the very foundation of every company’s preferred option: ‘self-regulation’. It puts companies in the driver’s seat, raising their accountability, transparency and resilience. It ‘democratises’ financial information so all business managers can, every day, every minute, make sound, data-informed decisions: should IT hire this contractor for this project now or wait until next quarter? Does our projected cash flow support our sales hiring plans for Q1?

The companies I see transforming most successfully are those whose offices of CFO are rising to meet modern challenges. In these companies CFOs have long moved on from being “stewards of the books” to assuming much broader operational roles. They might not have moved completely out of the back office, but are certainly evolving into fully accountable business partners. They increasingly either make or inform strategic, board-level decisions.

Transformation also frees more junior team members from repetitive drudge work like number crunching and poring over spreadsheets so they too can support the business. Sales and marketing teams, for example, often need guidance on how to forecast more accurately at different stages of the sales funnel. Too often numbers are plucked out of thin air, or based on a competitor’s forecast.

Our customer Laing O’Rourke is a great example of a company with strong leadership that’s completed six phases to transform its office of finance. Having started in 2011, it’s dispensed with its old manual, spreadsheet-based environment along with outdated practises and data silos. It has replaced those with a consolidated ‘data hub’ that uses several of our SaaS applications (planning, tax, cash flow, consolidation) to view, analyse and build reports on warehoused financial and operational data. Multiple finance team members can view information and run reports based on one version of the truth. It’s just launching the ability run daily liquidity forecasts, a vital tool in de-risking the business.

Laing O’Rourke will continue on its journey for years to come. However, what I’ve seen so far is as inspiring as Graham Pattison’s (who leads the transformation’s) ambition to climb Carter’s Hill - one of the longest, steepest inclines in the ‘Kent Alps’ - on bicycle. He approaches his company’s transformation with same determination, preparation, attention to detail and passion as he does his many cycling challenges.

Crucially, Graham also holds himself accountable for reaching goals - not blaming the weather conditions, his equipment or the state of the roads. Because while blaming a rogue trader or your auditor might get you off the hook with John Humphrys on the Today Programme, it won’t return your company to good health.

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