Needless to say, the effort of installing an ERP system or of setting up a shared service center takes time away from more strategic work. For at least the next few years, many finance teams will have little spare time over and above the management of these sorts of projects. In the long run, though, the resulting automation will serve to free up finance staff time rather than constrain it, and so increase their ability to partner more closely with their business units.
“Different companies are at different stages on the evolution of becoming more ‘value-added’,” says Podrebarac. “Some are still locked down in basic transaction processing, while others have embraced concepts like shared service centers and outsourcing and are moving to the next level.”
Arjun Sarker, Asia Pacific CFO for New Zealand-based Fonterra Brands, a $3 billion-a-year producer of milk, cheese, and other foods, concedes that his organization is only just starting out on the path. Sarker joined the company earlier this year and says that what he found was “largely a controllership organization.” His job, he says, is to change that outlook. “I’m trying to move away from a philosophy of transaction processing towards one of business partnering.”
To that end, Sarker is now documenting and re-tooling all of his department’s processes, cutting out unnecessary ones and improving the others. For example, by shortening his month-end reporting cycle from three days after-close to two, Sarker has already freed up time for other tasks.
He’s also spending a lot of time talking to managers across the business to find out what sort of “products” they’re interested in receiving from his finance team. “At the moment, we’re producing a lot of reports that people don’t use, and yet we’re not providing information that would be really useful, like analysis of working capital efficiency and average selling price,” Sarker notes. “We’re changing that now.”
Equally, Sarker is reorganizing the people in his team by rewriting everyone’s job description, goals, and objectives, and by re-setting the metrics used to measure their performance. In the past, notes Sarker, job descriptions were woolly, there was no clear accountability for individual processes, and the setting of objectives boiled down to nothing more than half-hearted “form-filling.”
“The whole finance framework needs tightening,” he says. “I’m trying to push responsibility down to more junior staff and make them more accountable.” So, for example, the person in charge of demand forecasting now manages the process without needing approval and input from senior managers. He or she is also rewarded based on the accuracy of those forecasts.
“We have a long way to go until we’ve fully embraced the mindset of being business partners,” says Sarker. “At the moment, I’m really only concentrating on building out the basic finance framework: the processes, the controls, the people. Once that’s done, we’ll be able to spend more time on strategic things like talking to customers, really understanding how an FMCG business works, and looking at areas like branding and M&A analysis.”