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The role of finance in developing truly Agile organisations

iStock 1210906908 - Global Banking | Finance

By Steve Martin, the CEO of Agilistic.

There’s no doubt that as with the financial services industry as a whole, CFOs and the finance function within organisations have to deal with a complex landscape. Operating within this landscape leaves financiers with less capacity, especially when it comes to planning for and embracing new ways of working. Multiple regulatory, compliance and bureaucratic obstacles can often hinder transformation but as finance functions across the globe  evolve, from their data governance right down to their delivery of value for clients, CFOs and finance functions will need to explore beyond their comfort zone in order to deliver true value both internally and externally.

And this is where Agile can come in and offer a tailored path towards sustained transformation, continuous improvement and a thriving culture.

What is Agile and how does it fit in with finance?

More than often, Agile is seen as just another project management tool or another buzzword making the rounds in an already jargon-ridden business world but in reality it is so much more than that. Agile is an often used but little understood concept in organisations of all sizes. Although Agile originates from the programming function and the Agile Manifesto clearly states that one of its key values is to deliver working software, Agile is now much broader and can be used to benefit   organisations in any industry.

Introducing Agile means that teams are working as efficiently as possible focusing on short-term goals which are constantly reviewed allowing them to set realistic deadlines, making progress, and solving issues as they go along. True Agile working goes beyond the hype and is the under-utilised power at the fingertips of business leaders which can have a seriously positive impact on business culture, management and growth.

There are plenty of advantages to adopting Agile and one of the main paths for introducing it can be through the finance function. Finance has always been at the beating heart of  business with CFOs and the finance function being strategically placed to help organisations future proof their operations and expand into new sources of growth. From funding R&D and innovation to day-to-day operations, finance has an active role in every part of the organisation and it is present from the beginning to the end of the value chain. Therefore, finance can act as an end-to-end integrator when it comes to organisational transformation. I’m always surprised when organisations don’t see that involving the finance function in this process is a no-brainer.

Agile can help manage uncertainty

While CFOs and finance functions across different industries often recognise the need to change their practices, they are often held back by a risk-averse culture. The very processes that were developed to ensure that nothing falls through the cracks can end up becoming a blocker when it comes to operating in a fast-paced world. So how can finance shift their mindset to think outside the box in a safe way in order to be able to compete? It’s all about scalable transformation which is what Agile, when done right, is all about.

A key part of successfully kickstarting an organisation’s Agile transformation is the principle of transforming an organisation in small, incremental stages while repeatedly looking to improve. It’s all about thinking big but starting small and keeping an eye on value delivery. It’s about making sure that every project and process is as lean as possible and continuously delivers value. By honing an Agile strategy, finance can better prepare their department for challenges and evaluate change and investment based on small bets without hindering growth.

Seed funding Vs Annual Budgeting

Seed funding can play an important role when it comes to new initiatives and pilots being spun out in quick time without the constraints of compliance and regulation. This can empower organisations to adapt to changes in market demands and respond at pace. A seed funding approach, where the approach is similar to that of a start-up mentality, allows the organisation to test out an idea in the real world before scaling. This requires a complete shift in budgeting strategy and process but can enable an organisation to adapt faster in a fast-moving business environment.

Giving finance a place at the top table

An Agile finance function with the right mindset and tools can achieve high levels of insight and measurement. This combined with the function’s inherent knowledge of the business can provide the operational awareness to make better use of capital and work better cross-functionally to pursue multiple growth streams at once to scale the business in the right direction. It will allow the department to experiment fast, embrace change, and retain a strong connection with customers and other departments.

In a post-pandemic world which is in a state of flux, doing what you’ve always done is no longer an option, so it’s time for the finance function to take a more proactive seat at the Agile transformation table and use its position strategically to distribute knowledge across the organisation. Think of an Agile organisation as a living organism, with finance playing an important role in developing a unified vision through data-driven insight.

Author Bio

Steve Martin a seasoned agile coach who empowers ambitious organisations to embrace agile working to deliver better value to their people and customers, Steve has worked with organisations including BT, Vodafone, HM Revenue & Customs, William Hill and The Department for Environment, Food and Rural Affairs.

Global Banking & Finance Review


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