Shared Services and Finance Transformation: What’s Working and What’s Not

When done well, finance automation and transformation programs help shared services excel in ways that are inspiring, exciting, impressive and highly financially rewarding. Yet many finance transformation programs fall short. The projects are added to the list of failures. Money is wasted, reputations are damaged and down-beat culture sets in.

All of these setbacks can be avoided. This report sets out what bear traps to look out for, and how to secure a more confident route towards program success.

Understanding the pitfalls and success factors is crucial for navigating these transformations successfully.

Key Findings from the Survey

A survey by sharedserviceslink and Tradeshift, involving over 100 senior finance professionals across Europe and North America, sheds light on the current landscape of finance automation and transformation. Here are the critical insights:

The goal of finance transformation

Our respondents say that their clear and common goal was to move from transaction processing to offering value-adding services
74% aim to use technology to pivot from transactional work to value-adding work. Their goals now center on: helping the business make strategic decisions; improving customer service; and supporting wider changes in the business.
About half (49%) said a main aim was to reduce costs, and less than a third (29%) were looking to reduce headcount.

Success Rates and Satisfaction Levels

93% of surveyed companies are on a finance automation journey.
Of those on a finance transformation journey, 32% of them are dissatisfied with the outcome (1 in 3).
Almost half (46%) said that senior-level support was critical to their success and 39% cited solid project management.

Common Challenges

Fragmented processes, resistance to change, poor collaboration, and data quality issues were highlighted as significant obstacles.
The most common challenges on automation journeys are:
Fragmented processes (46%)
Resistance to change (45%
Poor collaboration (41%)
Data challenges (41%)

Technologies and Implementation

62% of respondents have upgraded or consolidated their ERP systems, and 49% have implemented workflow solutions.
34% have adopted e-invoicing, a number expected to rise with upcoming regulatory mandates.
Despite the high adoption of technologies like OCR, there is a growing recognition that advanced solutions such as e-invoicing are essential for future scalability and efficiency.

Lessons Learned: What Sets Successful Projects Apart

Successful finance transformation projects are distinguished by three main factors:

Better Data Quality: Reliable and high-quality data is foundational for effective automation.
Strong Project Management: Effective communication, stakeholder engagement, and continuous updates are vital.
Inter-Function Cooperation: Cross-functional collaboration and buy-in from all departments significantly enhance project outcomes.

Overcoming Common Bear Traps

To avoid the pitfalls that derail many finance transformation projects, consider these strategies:

1. Set Realistic Expectations

Automation can yield substantial benefits, but it’s not a cure-all. Establish achievable goals and manage expectations, particularly with complex or paper-based processes.

2. Emphasize Communication and Collaboration

Clear communication and cross-functional collaboration are essential. Engage stakeholders early, and appoint a project leader with the skills to drive change and maintain momentum.

3. Prioritize the Human Element

Change management is crucial. Invest in educating your team about the benefits of the transformation, provide thorough training, and monitor adoption closely to ensure compliance.

4. Invest in Data Quality

Data is a critical asset. Establish a strong data governance framework, ensure data quality, and invest in the necessary technology and resources to maintain high standards.

Conclusion

The journey towards finance transformation is fraught with challenges, but by learning from the experiences of others and focusing on critical success factors, organizations can navigate this complex landscape more effectively. Investing in technology, fostering collaboration, and prioritizing data quality are key to achieving the desired outcomes and unlocking the full potential of shared services.