Navigating Uncertainty by Gaining Timely Perspectives
Information available for decision-making is often limited, delayed or incomplete within organizations as internal processes typically fail to provide meaningful data to the required level, even when it is already present, which should be a concern to all.
Without any strategic vision for optimizing internal systems and data use, organizations risk declining competitiveness over time as others gain an advantage. Simply maintaining the status quo of delayed reporting which is typically driven around monthly reporting processes is insufficient; remaining static is equivalent to falling behind. Costs and errors are not reduced, and staff are not being freed up for higher value work, but it raises the question – are companies waiting for better systems or more capable employees?
Here, we delve deeper into eight specific operational obstacles that hinder businesses from an internal systems and employee standpoint:
1. Achieving Accurate and Timely Reporting. Reporting and workflows need to be able to support both qualitative (text based, forms questionnaires etc) and quantitative (numbers, calculations etc) processes that can be generated in a timely manner @anywhere @anytime within a process, not just at the end. These can be proactively used by employees for management activities, controls, and decision support to keep daily employee actions on track, within budget, and within regulatory compliance.
There are two macro levels of management activity, the first focused on reports and workflows that need to be reviewed regularly for control purposes / decision support, and the second on how individual actions are playing out in aggregate against strategic plans, including within segments and forecasts / budgets.
The question to be asked is, “why are teams of employees working for their system, rather than the other way around”. The reverse should be true, particularly when it comes to risk management.
2. Managing Risk. Risks emerge in intricate ways, impacting companies through a diverse array of internal and external perils. Risk is dynamic, not static, and the emphasis can shift over time.
This calls for the capability to perform detailed data management and integrity checks at a highly granular level across the board, but prioritised into key areas. For example, data management (including cross border data transfers), supplier management, and cybersecurity / privacy etc.
Capabilities should be in place to address cyberattacks in accordance with jurisdictional regulations (which entails having a proven and robust incident response plan), noting that non-compliance with regulatory standards may result in significant fines, forfeited opportunities (including loss of operational business licences in some jurisdictions), and harm to an organization’s reputation.
More time should be found to strengthen this area.
3. Alleviating Time Constraints within Functional Areas. The pursuit of improved productivity and accomplishing more with existing resources is a constant, and technological advancements such as faster queries and reporting have certainly facilitated progress to some extent in this area.
Nonetheless, time constraints, system deficiencies and limited human resources make it difficult to attain prompt, high-quality reporting output, which leads to a disrupted work-life balance for some employees, particularly to those challenging one liner emails!
The relentless mental reassessment of whether submitted reports (especially monthly reporting packs) are accurate can lead to restless ongoing thoughts, often extending into the early hours of the morning, subsequently impacting sleep and personal well-being.
Other looming concerns, such as the current US debt ceiling negotiations and its potential effects on interest and foreign exchange rates, necessitate effective communication and contingency planning discussions. It is clear that time constraints continue to intensify as demands on time increase, and these need to be tackled before something breaks.
Obstacles to change typically relate to the internal validation of new digital initiatives, such as determining ROI and resourcing the increased activity hump. ROI challenges come down to a lack of previous focus on efficient resource management benchmarks. As an example, where studies have been done, there has been a wide spread of days required for monthly closing as well as actual $ costs to execute them within the same business vertical, with the difference being attributed to management focus. To get things done, some organizations tackle change through a skunk project approach, which generally denotes activity within a functional team rather than across multiple functional areas.
Implementing change and addressing the human challenges that come with reducing time pressures is never straightforward, as people naturally resist change. Plus, there will always be workforce volatility and skills gaps. However, as the saying goes, “no pain, no gain!”
4. Managing Workforce Volatility. An involved dynamic workforce is a powerful corporate asset but can still present to management a multitude of more detailed challenges, such as resolving talent shortages and skill gaps.
Proactive management of employee retention, skill development, progression, and hiring processes is essential for organizations to secure the necessary human capital to evolve and thrive. Putting into place workforce planning and performance management frameworks that utilise the same principles of granular data management is a strong step in the right direction.
Threats within the workforce are always emerging and are not always where you think they might be. For instance, the digital literacy divide between management and employees within your organization is an area where overall progress might be hindered, due to a lack of alignment regarding the capabilities of current technologies, compared to the past.
Communication, planning and benefit initiatives are more important than ever during any change, as is fully appreciating generational attitudes.
5. Appreciating Generational Attitudes. Currently, five distinct generations coexist in the workplace and the disparities between them will become increasingly evident. There are a number of differences amongst these generations, noting that these can cause misunderstandings and tensions between them.
Referring to younger generations cf older generations, then the former prefer different methods of electronic communication cf more traditional face to face meetings, flatter HR structures cf hierarchical pyramids, are more digitally literate, plus achieving a work-life balance is a higher priority. Change is going to be a constant.
On particular societal issues such as sustainability, it has already been observed that younger generations can take decisive action personally when management is seen to lack focus. In today’s world, corporates must have the ability to navigate both quantitative and qualitative processes to enable transparent inclusive communication and collaboration amongst all employees within these sensitive areas, ultimately benefiting from nurturing the development of innovative ideas from a broader resource base.
While generational shifts have regularly taken place in the past, the current transition has greater breadth and depth than before. For example, today management must avoid employees being overloaded with data, as this will impact their decision making. Put another way, more work has to be executed by our business systems, and in a more intuitive way.
6. Embracing Data-Driven Decision Making. System limitations have sometimes led to employee decisions being based on incomplete or inconsistent data. Businesses are in a state of transition, and whilst it is not entirely implausible to envision a future where operations occur in real-time, there is a journey to complete.
To get there, data management and analytical skills of employees will have to be enhanced, and of course trust in the data will need to be built over time. Nowadays, considerably fewer technological obstacles exist, but challenges related to mismatched skillsets and change management remain persistent.
Changing the status quo here will not be easy. It will require staff to broaden their business and IT horizons to gain greater context as to where their roles and actions fit into to overall business models in order to effect meaningful change. They will need to improve their own domain skills, and gain an appreciation of others.
Despite the challenges, it’s evident that we’re moving towards a data-centric approach. This transition will bring about smarter processes aimed at directing our focus towards specific challenges at the appropriate level of detail, rather than displaying entire data sets. This crucial shift will help concentrate our efforts on the complexities involved in shaping future actions to drive value.
7. Driving Value Creation. A great deal of related information resides within different internal systems and these days many corporate grade business services are web based. Integrating these and exploring value creation opportunities across our business functions opens up opportunities to drive deeper collaboration and value across business domains, particularly at the intersection of functional areas. Note that the same is true for exploring business model changes that encapsulate adjacent industries.
Many analytical solutions on the market, however, have operational constraints. For example, one question to consider is:“can users deploy reporting analytics, visualisations, and inter- + intra-workflows @anytime @anywhere within a process, and can the right supporting data sets from relevant subsystems or relevant third party systems be accessed for the task at hand or via actionable contextual reports and workflows”. Often older architected solutions are not powerful enough to deliver timely required results.
Technology that drives value creation is here today, but management mindsets will have to adapt to harness the power that this brings to the table. This in turn will release time for value creation.
Where should corporates start?
8. Prioritising Change to Business Systems. Determining the starting point and the path to achieving change orientated goals can be a daunting task, especially when software vendors appear, at least on the surface, to provide comparable solutions. It’s essential to be strategic and particularly to evaluate how to capitalize on your existing solution sets, rather than replacing systems merely for change’s sake. However, do focus on replacing systems with a high technical overhead.
Applications with a large technical overhead / total cost of ownership (TCO) are not only slowing you down, but at the same time are consuming budget that could otherwise be used to drive value. As time progresses, service related costs will rise, and securing resource availability for older systems will become more challenging.
What can we do about the above challenges in aggregate? In a nutshell, it is all about leveraging modern day technologies, managing workforce constraints, and getting processes to work for you and not vice versa. This will provide timely access to quality data. Let’s explore more:-
1. Achieving Accurate and Timely Reporting. Today’s business systems utilise modern process technologies that can be applied across applications and ecosystems to consolidate relevant subsets of data into a single report. These systems can auto-analyse reports at individual entity, segmental or consolidated levels, producing ranked variance information with supporting details to the materiality required for decision-making.
Processes are highly configurable and adaptable at granular level. From data collection (including RPA for document onboarding with or without AI) to data transformations (including reconciliations, consolidations), enrichments, contextual reporting, visualizations, and workflows accessible anytime, anywhere. APIs can be integrated with other applications and ecosystems, even utilizing Open Banking APIs for payments / financial services.
Moreover, simulations (an example of where skills have to catch up with technology) facilitate ongoing digital process improvement by utilizing historical or reforecast data. Modern process architectures solve older processing issues, such as granular data transformation and speed, thereby enabling the automation of reconciliations or consolidations, both of which continue to consume excessive time and resources of senior staff on a regular basis.
Ultimately being tailored for specific tasks, resulting process applications are compact, efficient, and extendable further to drive related ongoing actions. They are easily adjustable or replaceable, fast in process execution due to their small size, the latter also facilitating debugging activities during design.
The ultra-granular process structure mentioned above facilitates improvements for both qualitative and quantitative processes, including risk processes explored next.
2. Managing Risk. Corporations are taking measures to enhance their overall cyber resilience, a process being further facilitated by having to meet the requirements of handling personal information (sovereign data rules and cross border data transfer rules). This is bringing a higher level of awareness to employees, including data classification disciplines, and data management mindsets.
In general terms, compliance requirements have become increasingly detailed, integrated and multi-layered for all corporates, necessitating simultaneous ground-up risk related process development / lifecycle management, and ongoing employee education on best practices.
Latest process technologies support this systematically through being able to execute controlled, managed, qualitative processes on a quarterly or otherwise specified basis. The same technologies can be extended to solve the other risk areas introduced above, such as those surrounding supplier management.
Supplier management is gaining prominence for various reasons:-
- Risk management processes are now extending reach to suppliers in order to comprehensively manage cyber risks within these third parties, as they have been proven as a known external risk point,
- Sustainability processes are extending to suppliers for the management of Scope 3 Emissions, a process that will take time to introduce but which is slowly being nudged forwards by global regulatory authorities.
To extend compliance focus further, more advanced compliance controls can be implemented at multiple levels. Modern technologies facilitates this by:-
- Identifying data outliers,
- Using aforementioned process designs to build other comprehensive checks points and balances, even using innovative roundabout math processes to reach the same conclusion (an example in the F&B industry might be comparing output to raw material consumption),
Corporates are always keen to expand governance, but time constraints, running through this article, often get in the way.
3. Alleviating Time Constraints within Functional Areas. This is never an easy one to solve, as all are already focusing on their “day job”, but there are a number of approaches or combinations thereof that can free time, including skunk projects.
The conundrum in hand is the depth and order of change that one should aim for in the first place. A number of potential actions emerge here that can start to release time;
- Review the use of your more larger, often used, and more sophisticated spreadsheets, and automate them based on the aforementioned process designs, noting that modern process designs can add strong data integrity controls to spreadsheets or remove them altogether,
- Automate other repetitive tasks like reconciliations / consolidations, including segmental analysis and any other form of aggregated reporting or other such areas / activities that take time,
- Assess specialist areas that are likely to heavily rely on spreadsheets, like lease management and bond management, where solutions now exist where they did not before,
- Stop producing full blown reporting packs if no one is reading them. These might be streamlined to ensure that reports are readable, digestible and contain the right level of detail so that they become useful.
A further rule of thumb when tackling change, is to make sure that project teams contain participation from all areas impacted by change, and that required systems integration skills are available. Projects often fail if these are not in place.
New solutions can streamline and automate reporting, saving your teams hundreds of hours per year and freeing up resources for higher-impact work. As with anything that is staff related, always keep all relevant stakeholders regularly informed on progress to avoid greater levels of staff volatility.
4. Managing Workforce Volatility. Employee Self Service (ESS) and Management Self Service are vital tools in the employer to employee to employer communication ecosystem to foster engagement at various levels. These applications save time and improve work-life balance, as they are accessible anytime anywhere.
On top of this, they become a powerful conduit to drive correctives actions or workflows to all types of concern, even those identified proactively by the system; for example, where employees are not achieving a work-life balance due to excessive workloads and are a risk of burn-out / leaving.
Of particular note, HR processes involve copious amounts of both qualitative and quantitative actions / reporting, but traditionally both of these have not been possible within the same applications for @anytime @anywhere access.
Additionally, granular workforce management and planning, where combined HR and Financial data will be reviewed in parallel, is new to many organisations. Combined data can generate a lot of value eg retention data by department / manager, delayed onboarding $ impacts to revenue, replacement fees (especially aggregated), and work-life balance (more below) etc. Detailed compliance rules can be applied.
Generational attitudes also have an impact here.
5. Appreciating Generational attitudes.
Above we explored some differences that occur between generations, which means that corporate processes should have regular review points to assess how interactions should work strategically in employee to employer to employee (E3) communications. In this respect, modern day systems can be designed to be more proactive around generational values.
As an example consider sustainability, which impacts employee retention within younger generations. By integrating sustainability into your organizations core values and operations (using ESS as the conduit), you can not only enhance your competitive position but also contribute to building a more sustainable future. The best ideas often come from employees.
Another example is work-life balance. For example, identifying staff who are at risk of burn-out, or leaving, by reviewing such control points as hours worked, holidays taken current year compared with previous periods. There are many other touch points where this approach will work, noting that information can be displayed in different ways, including heat maps.
Going forwards your process requirements are going to be more granular, more proactive, more tailored to an employee to drive unique actions, and potentially subject to different levels of data field level compliance.
Lastly, there will be greater levels of emphasis placed on existing employees both directly and indirectly, as organisations pivot to embrace data driven management for workforce planning and proactive staff management.
6. Embracing Data-Driven Decision Making. From a technical perspective actionable contextual alerts and workflows that contain supporting information to your required level of materiality can be driven now. The system works for you and not vice versa.
However, there are a number of stumbling blocks to overcome inertia. The first is scoping. Should these projects be tackled within functional domains or across them, and at what level should execution take place within the technical stack.
Whilst working across functional domains will offer you more scoping options to reduce fiefdoms, data duplications, and data silos, working within them represents an environment where the building blocks are to a greater extent already in place ie domain expertise and single control structure.
Quality timely data will enable leaders to be more confident about a situation by removing timing differences, pivot quickly based on facts, and formulate strategies to suit external factors. It will help drive decisiveness, resilience, and power the content of communications to help others understand the situation and what is at stake.
In many cases, organisational structures will support inter-entity process deployment to further enhance reporting eg streamlining the processing of reporting packs. Modern systems enable 3, 2, 1 or 1, 2, 3 deployments (this specifies who is deploying the process, HQ or entity). This in turn will free more time for value creation.
7. Driving Value Creation. At a macro level, functional team members know better than most where they struggle and where they can add further value, but are often in a situation where they cannot move to next steps.
Modern technologies facilitate the next steps required for process transformations, allowing the establishment of timely procedures that produce high-quality data results that can be used for deeper value creation. As employee trust in data increases, conversations and collaborations become more profound, paving the way for the discovery of additional opportunities related to value generation.
Deeper value creation opportunities are clearly within reach, particularly at the intersections where functional areas overlap (or adjacent businesses), but what solution features will move you forwards.
8. Prioritising Change to Business Systems. Typically, for modern day systems these can be articulated as:-
- Being able to handle both qualitative and quantitative business workflows,
- Being able to execute both intra- and inter-company process flows, not just one of them,
- Ensuring that solutions are optimised for your business domain,
- Ensuring that you have the choice to granularly deploy solutions at a technical level for extensibility: i) on-premise, ii) single or multi-cloud or iii) hybrid, noting that some might also benefit from cloud-burst deployment,
- Being able to handle integrated compliance options to the degree needed for regulatory requirements or corporate needs,
- Access to low code, no code where it makes sense.
Note that corporates can have preferences on approaches for driving change: top down, bottom up, all at once, or step by step. With each approach there will always be risks and challenges to navigate, as well as the need to balance immediate requirements with long-term objectives.
Conclusion
New tools are the key to resolving these challenges. By leveraging modern technologies to automate repetitive tasks and gain instant access to accurate data, executives can alleviate time constraints, manage workforce volatility and embrace data-driven decision making.
Technological solutions now exist that can handle both qualitative and quantitative processes with granular controls, enabling timely and informed decisions. Prioritize process flows that free up time, gain employee trust in the data, start with low-hanging fruit projects, and execute changes incrementally. Focus your systems improvements on areas with the greatest payoff and that support your long-term business objectives. Change is never easy, but the time to act is now!
