What is your organization’s purpose? Do your accounting and finance teams have clear goals they can rally behind and work together to achieve?
Bill Thomas, principal at EY Advisory, understands the power of using purpose to transform your organization. And he’s seen first-hand that when people get behind a company’s initiatives, they accomplish incredible things.
Including finance transformation projects.
In a recent survey, Forbes reports that 48% of executives believe their organization is only somewhat or not at all prepared to successfully execute a business transformation. And 41% believe that this is because of inefficient execution.
According to Bill, the reason for this all comes down to two things: silos and politics.
Challenges Created by Silos & Politics
We all know that silos exist within most teams, and those silos are fiercely defended.
Bill says, “Silos exist because people have a purpose for what they're trying to accomplish. They went to school and have skills and very specific knowledge pertained to what they are paid to do. ‘I’m a tax guy.’ ‘I'm a finance guy.’ ‘I'm a risk guy.’
“And they have executives they report to who say, ‘I want you working on my stuff.’ So how do you get those groups to work together? It's not easy when you're both fighting for scarce resources to accomplish change.”
Navigating politics is even more challenging, because it’s focused on “what’s in it for me?” This drives behavior and can slow down transformation initiatives.
How to Combat Both With Purpose
When leadership and teams align internally to achieve a common purpose, the silo walls suddenly aren’t so high, and the politics not as divisive.
The internal purpose of finance is to measure and drive company performance, and how this is done is driven by leadership.
Accounting and Finance are used to hearing about the need to cut costs—and this is continually demotivating. When company leadership genuinely invests in finance transformation, motivation and engagement increase.
This looks like giving teams the challenge to innovate and provide the information needed to drive the business forward. Giving them the purpose of measuring and driving the company’s performance, along with the financial investment and time needed to accomplish those goals.
This can lead to more effective strategies for performance measurement. To get there, finance needs the autonomy to think differently.
“Too often we think about it from right to left—from the report to getting the right information,” Bill explains. When the focus is only on requirements and compliance (such as external reporting and disclosures), Finance misses the opportunity to provide meaningful insights. And that involves thinking differently.
“Detail is your friend. When you start from left to right and look at what's available, then you're able to actually produce the reports and slice and dice the data any way you need to.”
The Impact of a Purpose-Driven Approach
Purpose makes an impact, and organizations that embody purpose see significant measurable results. EY research found that:
Employees are 1.4 times more engaged and 1.7 times more satisfied
Employees are 3 times more likely to stay with the company
89% of clients believe a purpose-driven company will deliver higher quality products and services
72% of global consumers would recommend a company with a purpose, a 39% increase from 2008
84% of emerging market consumers make cause-related purchases at least annually
According to Forbes, purpose-driven companies outperformed the S&P 500 by ten times between 1996 and 2011.
Bill says, “When there is a purpose and everybody believes in it, you provide a better employee experience. You also attract, retain, and engage your customers on a completely different level.”
Read Part 2 to learn why successful finance transformation projects are also built on effective communication.