How can finance professionals use change management to improve their leadership skills?

Finance undergoes a massive transformation with AI - it is the time of change management. ? Understanding what the business needs, how the areas in finance are impacted is a super important role in finance professionals' every day. As a leader, it is your task to create an open and transparent communication within the team. So that there is space for sharing feedback and innovation. Good luck!

What I found useful in teaching change leadership, coaching & interacting with leaders who implement change & driving change in my own team is to always ask 2 things: 1. WHY is the change happening? Using the PESTLE Analysis*, leaders can identify the external factors that drive change. This helps them see change as a natural evolution of the profession & hence, facilitates faster & easier acceptance of change 2. WHAT forms of change do I expect to see in my profession & organization? Using McKinsey’s 7S Model*, finance leaders could anticipate how big changes will manifest in organizations/ the profession. Anticipating the change enables leaders to be more in control of their response to change. *Pls Google for better understanding.

Understanding the change is a critical first step. For example, finance professionals may face changes such as the implementation of new financial reporting systems. It is important to recognise how this change can streamline operations, improve accuracy, and provide real-time financial insights. This can lead to more efficient financial decision-making and better business outcomes. However, it is also crucial to consider potential obstacles in user adoption, such as training needs, resistance to change, and the need for ongoing support and communication. By addressing these challenges proactively, organisations can ensure a smoother transition and maximise the benefits of the new financial reporting systems.

If you're a finance professional, you probably see the world in black and white, but change is not binary, and it's definitely not just numbers! Start by humanising the financial change. Consider the impact on individuals, teams, and the broader community. Connect the dots between financial decisions and the real lives they influence. Remember, behind every financial figure lies a human story, and by humanising change, you transform numbers into narratives of impact and understanding.

The reason to change may be different for different levels in the organization as they may be experiencing different and similar pain points. These are some of the efforts that I find useful: The Case for Change has to made for the Leadership, Middle Management and the rest of the organization where Middle Management and the rest echoes the Leadership but is customized to their specific pain points. The communication has to be at each level and the short, mid and long term targets vs progress must be communicated and shared frequently.

In change management, finance professionals can bolster leadership skills by assessing readiness for change. This involves evaluating personal, team, and organizational preparedness, identifying skill gaps, and recognizing potential barriers. It's crucial to determine the willingness and capability to adapt. Strategic interventions, such as specialized training, coaching, or mentoring, can be employed to develop necessary competencies. This approach ensures a smooth transition, equipping finance leaders to effectively manage change within their teams and organizations.

Evaluating readiness can be demonstrated by a financial team as they shift from manual to automated processes. The team's willingness to embrace automation technologies, such as AI or Machine Learning, is paramount. This can be further reinforced by conducting comprehensive assessments to identify any skill gaps and areas that require training. By arranging training sessions or workshops to address these gaps, the team can enhance their proficiency and ensure a smooth and seamless transition to automated processes.

Having a team who believes in the change is mission critical. The difference can be seen in terms of the conviction, passion and dedication. As part of gauging change readiness, stakeholder profiling is essential to assist the team to address key stakeholders in driving the change. The key is to ensure your list is exhaustive. Most of the time, once you are able to convince skeptical stakeholders i.e. understand the value, they will be your greatest ally and champion the change itself.

Assessing readiness for change hinges on addressing fundamental questions: ?? Identifying the necessary skills for our team is crucial. ?? Determining the knowledge required for success is equally vital. ?? Understanding the essential resources—be it finances, equipment, or training—needed to navigate this change effectively is key. This exercise uncovers critical gaps in your team's readiness for the planned change. Identifying the crucial skills, determining essential knowledge, and understanding resource requirements are fundamental aspects when assessing the team's readiness for upcoming change, revealing critical gaps and prompting further inquiries for a comprehensive evaluation.

Finance leaders (and professionals) can collaborate with change management teams and Sponsors and participate/lead in assessing the readiness of the org, business unit and the teams for the change. Depending on the impact of the change, they can specifically highlight and explain the financial implications for the team, business unit or the entire org and can also give powerful insights (based on their experience) into how the readiness can be achieved in steps. For example, the change might involve a change in behavior of employees of how they are recording the costs into a particular SAP account(s) and how the reports need to be run in a different way going forward, etc.

From experience, developing a comprehensive stakeholder management plan is crucial, requiring careful consideration of several key elements: 1) Identify the primary stakeholders involved, 2) Assess their levels of interest and expectations, 3) Determine their specific communication needs and preferred engagement approaches, and 4) Conduct a basic risk assessment to understand potential impacts. Taking the time to address these aspects systematically equips you to navigate change more effectively, allowing for proactive issue resolution and ensuring a smoother transition. This strategic approach enhances your ability to understand, communicate with, and manage stakeholders.

Engaging stakeholders to drive buy-in or desire requires one to truly understand, not just what is changing or the impact on each individual, but what concerns each of those individuals might have so they can work together to find a plan forward. This requires trust which is essential for all aspects of change management

One effective way to engage stakeholders and ensure their buy-in is by clearly communicating the potential impact of a budget reallocation on their respective departments. By actively listening to their concerns, addressing them thoughtfully, and providing detailed explanations, we can foster a cooperative and collaborative relationship. This approach not only increases transparency but also demonstrates our commitment to considering their perspectives. Ultimately, it will help build trust and gain the necessary support for the proposed change.

As a finance leader who applies change management principles, you can differentiate yourself in many ways. Finance is a specialized field where concepts can become complex quickly. Change management requires you to get everyone on a bus together and ensure they all reach a destination safely at the end of the journey. For example, if you spend time figuring out what's in it for me (WIIFM) for your stakeholders, it will help with their buy-in and thus build trust in your leadership. Involving them as part of a change will allow you to interact more and delegate authority. If done well it will build familiarity and authority.

In my experience, Finance can play a critical role in engaging with the key stakeholders. Since finance professionals understand numbers easily, they can engage with the key stakeholders and explain the impact of the change (including the ROI) in an easy to understand language. Sponsors (and change team) need to facilitate this. This helps immensely in building a robust coalition for the change initiative. Finance professionals themselves may exhibit resistance to change and they need to recognize their own resistance (facilitated by change management team and the Sponsors).

For finance professionals, mastering change management is key to enhancing leadership skills. Managing the transition effectively involves setting clear milestones and performance metrics. It's essential to maintain open communication, ensuring all stakeholders are aligned and engaged throughout the change process. Utilize data-driven insights to monitor progress and adapt strategies as needed. Emphasize the importance of flexibility and resilience, equipping the team to handle potential challenges. As a leader in PMOs and Change Management, advocating for a structured yet adaptive approach demonstrates your ability to guide teams through change, balancing strategic foresight with operational efficiency.

A practical and effective example of managing the transition would be the introduction of new software specifically designed for conducting financial audits. It's crucial to develop a comprehensive and well-thought-out plan for this rollout, taking into account all the necessary steps and considerations. These steps may include initial training completion, thorough testing and evaluation of the software, conducting the first audit using the new system, and finally, the seamless transition from the old system to the new one. By setting clear milestones and diligently following the plan, organisations can ensure a smooth and successful transition, minimising disruptions and maximising the benefits of the new software.

Start the change process EARLY! This is the KEY to unlocking the potential for a truly impactful transition from where you are to where you aspire to be. As a transformation leader, this is where I see transformation projects fail, and fail again. My top tips for you: 1. Ensure that change impact and planning are integrated at project inception. 2. Invest time with stakeholders to proactively identify potential challenges, and co-create shared solutions. 3. Allocate resources appropriately across the transition timeframe. Remember, in laying out a comprehensive plan, you not only chart a clear course for success but also cultivate a roadmap that fosters team cohesion, minimises uncertainties, and maximises efficiency.

Finance experts can develop training materials specific to the financial aspect of the change initiative and embed it into the standard operating procedures of the relevant functions/departments/value streams. They can also coach the relevant employees on the SOPs, finance part of SAP/relevant software, record videos, and help in the transition.

To ensure the long-term sustainability of a change, such as the adoption of a new financial regulation policy, it is crucial to establish a robust framework for continuous monitoring of compliance and provide ongoing training and support. By consistently assessing adherence to the policy and offering targeted education, organisations can strengthen the implementation and reinforce the desired change. Additionally, recognising and acknowledging those individuals who demonstrate exemplary leadership in compliance can serve as a powerful motivator for others to embrace and uphold the new regulations.

Sustaining can be challenging if the above efforts are not done correctly. Change has to be embedded in work processes, managed by a single platform, and empowered within organization. Defining the productivity, its relevant measurement, regular monitoring and analysis and engagement would be a start. The recipients of change must reflect their individual or group deliverables in their personal goals. Establish a reward system for collaboration in meeting shared goals like team dinner, team holiday and etc. Then, role modelling by all levels of leadership and utilizing creative ways to ensure the right behaviors are pervasive within the organization sends a clear and resounding message.

Walk the talk! One of the best examples of change management I observed was years ago as an analyst working for a leader at a large intellectual property department. The day the team went live with their new digital document management system, the leader/boss, put a sign outside his office. It said, something like, before you come in please make sure the documents are in the system. No printouts. And, the adoption of that system in that IP department was the highest in the company.

In my experience, Finance plays a key role in sustaining the change by highlighting the gap in ROI expected/planned vs. actuals (benefits realized vs. planned or projected). They can also highlight the specific behaviors (of employees) which have not been sustained or embedded to the Sponsors. Finance professionals can also help in embedding the change in their own procedures, routines, meetings etc. For example, month end reporting, budgeting, dashboards, steering committee meetings etc. Finance professionals who are trained/certified in change management, continuous improvement, change leadership, emotional intelligence and role model/reinforce the principles consistently would make great change leaders.

Finance professionals should balances analytical skills with EMOTIONAL INTELLIGENCE, crucial for leading effectively in dynamic business environments where INNOVATION and TRANSFORMATION go hand in hand. Action items to enhance leadership through change management by focusing on emotional intelligence (EI) : 1. More than cost cutting, recognize and regulate emotions, fostering team collaboration. 2. Communicate effectively about changes, address concerns with more heart. 3. Practice empathy, understand team perspectives and support during transitions 4. Be less rigid - adapt leadership styles for different situations. 5. Clearly articulate the purpose of changes, align with business goals. 6. Genuinely seek feedback for improvement.

In leadership, mastering change is paramount. Here's 3 core skills that will help you enhance your change management capability: 1. Communication - practice transparently articulating change goals, actively listen for proactive problem-solving, and master persuading stakeholders positively towards the change initiative. 2. Emotional intelligence - Manage your emotions effectively and empathise with others. 3. Project management - develop a comprehensive plan with milestones, and improve how you anticipate obstacles through effective risk management.

While the subject matter will be different for financial professionals, the underlying connection between change management and leadership skills will be universal. At the end of the day, regardless of the function you’re in, everything around you involves change and the skills required to lead the people around you. Keeping that in mind, as a finance professional, take the time to deconstruct the work around you into it’s fundamental pieces. You’ll quickly see where the change and interpersonal leadership aspects lie. From here, you can identify the specific areas where you can experiment with and apply skills, reflect on the outcomes, get feedback, and adjust accordingly. When you take this approach, you’ll find opportunity everywhere.

Finance professionals enhance leadership by embracing change management. They build empathy, communicate financial changes transparently, and foster relationships with stakeholders. Coaching and mentoring elevate financial literacy, while visionary leadership crafts a compelling vision for success. Adaptability and conflict resolution skills manage resistance. Resource management ensures a well-equipped team, and a results-oriented mindset drives accountability. Celebrating achievements, promoting continuous learning, and leveraging technology showcase a modern, agile leadership approach. In this dynamic financial landscape, leadership evolves into a force that not only navigates change but inspires and accelerates financial success.