Accounting Process Excellence

I Googled “centre for process excellence” this morning…Not a single Australian company turned up in the top 10 results, and of the others that followed in the next few pages, all were IT focussed.
Bad Process causes Waste – more staff than are necessary, more transactions and rework and adjustments and journals than required, AND unhappy customers….
Why are IT on this bandwagon, and so far ahead of finance and accounting?
I understand that IT need great process, if the code is wrong or the wiring goes astray things break and/or simply do not function. Most hardware and software development isn’t undertaken in-house; IT is a rapidly evolving and highly competitive business.
So as IT is the core business for these developers so IT has grown up lean – the developers and manufacturers are driven to maximise their profits and being highly efficient and effective have become part of their measures. Consequently IT are leaders in process excellence.
By contrast most Aussie firms have their own in-house accounts and finance departments, nestled safely away from the revenue generating parts of their business. In general finance departments are considered a cost and therefore subject to “cost cutting”. This has led to a skeletal staffing whereby no strategic overview is maintained.







 

What happens when Finance have bad processes?
NOT MUCH!

This is not to say that the accountants, managers and clerks involved are being inefficient; they are often completing the tasks they have been given in a very productive way. I see finance people working very hard and doing each task quite efficiently – they have suffered headcount loss previously and are now BUSY – no time to mess about.
Busy doing things, the same way as yesterday, because everyone is too busy to stop and consider if the task is appropriate.
I have seen recently seen an Accounts Payable person efficiently printing, photocopying, scanning, emailing, filing and sending for microfiche each and every invoice received because that is what the “process instructions” required.
When I pointed out that the electronic copy of the invoice could be filed within their accounts system and the email filed within their data warehouse system – eliminating the need for any paper copy or the external microfiching process the financial controller said – “Oh, I was too busy to check what she had been doing.” This small adjustment to their process reduced their workload by 4 hours a day.
As Peter Drucker says:
“doing the right thing is more important than doing things right”.
I’m gathering other examples where finance and accounting departments are “too busy to be effective”, do you have any stories or examples to share?