How technology products and their vendors have an impact on employee engagement
The first three installments in this series introduced the concepts of employee engagement and why it should be a top priority for every business, regardless of industry, size or location. We saw why poor employee engagement is detrimental to the organization and can seriously jeopardize achieving its goals and in some extreme cases can even lead to its demise.
Since these concepts apply to every department within the company and to every manager and employee in every one of these departments, the finance department is no exception and should be treated the same way as any other department in the organization.
Furthermore, as someone who works primarily with the finance organization, I am very close to this function. Therefore, it only makes sense that I close this series of articles with the finance organization and how employee engagement can directly affect its performance and contribution to the overall financial well-being of the company.
The finance organization in all but small companies consists of accounting, finance, treasury, tax, reporting and compliance. All these functions work together to ensure control over financial reporting, resulting in completeness and accuracy of both internal and external financial statements; taxation (income tax, sales and use tax, excise taxes where applicable, property taxes, etc.); compiling and publishing reports to operations and senior managers; external reporting to shareholders and financial institutions; preparing annual budgets and forecasts; SEC reporting where applicable and all other compliance functions specific to the company and the industry it is in.
In addition to everything mentioned in the last three installments in this series, finance personnel must know and feel they are given the best available tools to do their work. This is also true for all other employees but since this blog focuses on the finance function, I will only touch on finance department tools.
This concept hit me hard a long time ago when I was trying to use a cheap trim router in my wood shop to rout an edge around a cabinet door. The tool was under-powered, the bit had excessive wobble and there was no variable speed. I was frustrated and disillusioned. Then I borrowed a much better and more powerful router and quickly discovered how the results can vary from poor and unacceptable to great looking with the added satisfaction of doing a great job.
Users of financial software in accounting and finance go through the same experience when using the wrong solution for the job at hand. Many of us have experienced the level of frustration reached by using Excel spreadsheets to program budgeting and forecasting models or perform analytics using complex user provided programming. These issues only get magnified as the organization grows and its needs become more complex and intricate.
Nowadays, all finance, accounting, reporting and tax functions are computerized and rely on software solutions and their vendors to successfully implement, customize and maintain these systems. Such systems usually consist of ERP (Enterprise Resource Planning), FP&A (Financial, Planning and Analysis), CRM (Customer Relations Management, often part of the ERP software), and tax preparation and compliance (for those doing it in-house). To that, one must add spreadsheets and word processors, of which MS-Excel and MS-Word dominate the business world.
Having the right tools and fully implemented, plus a good training and customer support function provided by their vendors will significantly encourage employees to use the products for their intended purposes. When automation eliminates, or at least greatly reduces errors and omissions and much of the tedious work associated with manual tasks (e.g., time consuming data entry), employees tend to be more productive; their work is of higher quality, and they seem to become more engaged in the work they do and the company they work for.
This, of course, assumes that the company, and particularly its HR department was successful in implementing an employee engagement program, one that is practiced company-wide, as described in the first three articles in this series.
Of particular interest to me and many other finance executives and professionals, is a successful implementation of an FP&A solution, one that encompasses budgeting, forecasting and analytics. When such a solution is integrated with the ERP software, has built-in business logic and accounting rules and allows its users to be self-sufficient in building their financial models (i.e., with no programming of logic, formulas and functions), the results obtained can be very impressive, even in smaller companies.
Such systems naturally encourage users to spend more time on analysis of actual data vs. budget data, doing so more frequently. Gaining insight into the company’s financial health and relaying it to senior management also gives users a great sense of accomplishment, partly because much of the guesswork is eliminated. Finance is now empowered to do their work with the best technology and important decisions can be made with greater confidence.
Knowing that the vendor’s customer support and technical services are available when needed is also a major factor in the finance department users’ confidence in the work they do.
However, it is the company’s CFO that must fully endorse these ideas and always be proactive in researching new finance tools and technologies.
Like any tool that works well and is well supported by its vendor, whether it is a finance related software solution or a CNC lathe, its users are more likely to enjoy using it and become more engaged in their work.
Alan Hart, MBA, is Principal Consultant at Pacific Shine Group in Portland, Oregon, with responsibility for client business development and hands-on client project implementations. Prior to starting Pacific Shine Group, he worked in various executive accounting and finance positions with technology and growth companies. Notable is his 18 years in the hi-tech manufacturing industry where he served as Controller, Vice President of Finance and CFO of several privately as well as publicly held companies in the Hi-Tech industry, such as Hybrid Arts, Inc., Hamilton Bay Associates and Syncronys Software. In his role in management consulting, Alan has worked in diverse industries and with a variety of clients, including fortune 1000 companies such as Boeing, Delta Airlines, Intel, Wyndham Worldwide and others, as well as many mid-market organizations such as Guitar Center, Ducommun AeroStructures, Cypress Semiconductor, TriQuint Semiconductor and others.
Combining his skills and experience in engineering with deep understanding of technical accounting, he is able to assist small and medium-size manufacturing companies establish GAAP compliant accounting and reporting systems.