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Tuesday, May 1, 2012

Leading Change in Process Improvement


According to Armanino’s 2012 CFO Evolution Benchmark Survey, Bay Area CFOs say the greatest organizational risk facing their companies is the failure to improve operational processes.

The survey results also showed that process improvement is top of mind among CFOs and is their most desired skill-set to add to the finance organization and an area they plan to apply budget increases.

If your company is mature, it will have "legacy" processes that may be ripe for reengineering. Best-in-class CFOs are not afraid to challenge the status quo and frequently place processes under the glare of hard logic. But logic alone won't do, says John Dunican, a Consulting Partner at Armanino who notes that process change is challenging on many levels.

"If you're trying to accomplish a reengineering initiative with limited resources, your ability to influence the company cross-functionally will come into play and that requires real leadership and a real plan," John says.

Most companies can identify and articulate when a process is inefficient, but fewer can analyze a business process end-to-end and then educate and "sell" the organization about why the change would be powerful and positive. Analyzing opportunities and educating the organization on the value of changing a process is key in leading change, John says.

Essential to success is development and sharing of an improvement plan and to broadly communicate the plan across the enterprise. "If others don't fully understand your plan, you won't get the buy in you need to make it work," John says. "If you embark on process improvement with a plan that is not fully understood horizontally, your chances of failure are much higher."

There are multiple channels for communication: develop a plan with your employee communications or HR teams who are in charge of in-house communications vehicles. Aim at influencers in each major functional area and get them to sign on and carry your message. Make personal pitches to key functional leaders as well. If you do this first, those tasked with the project will receive support from others. Provide messaging for managers to use in employee meetings.

By nature, business process improvement extends across an enterprise so aligning all key functional areas with the initiative instead of a single department is a good approach. "Owners of process improvement initiatives should consider the entire organization and their goal should be total understanding and total commitment from the entire company," John says. "Perfecting critical processes requires a sharp eye to identify opportunities for improvement, then an equally keen ability to lead and communicate so that execution and implementation are successful."

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