When Best in Class isn't enough!

As Cole Palmer again lit up the Premiership, this time with a hat trick and 'that penalty' its hard to know exactly what is 'Best in Class'. The perennial question asked of all Consultants which comes in a variety of formats ranging from 'How do we compare?' to 'are we Best in Class?' to my personal favourite 'We only want to compare to our Industry!' Because, we are special.

It is fair to say I have heard more Clients try to wiggle out of comparisons that they wouldn't last 18 minutes at the mercy of Cole Palmers right or left boot. You know by now that I believe in repetition to land a point or indeed a 40 yard screamer over the England goalie. Yes, that was the England goalie.

So to recap, start your Transformation journey with a clear analysis and proven definition of your problem, before advancing to your Vision of the future and then landing yourself with the most over used phrase in Consulting, your Target Operating Model.

Let me digress for a timeout to welcome our 1,400 Subscribers and delighted to see 98% are sticking to the Rules of the Game as 1st Degree Connections. The remainder will receive a friendly warning and then a ban by next week. We are at 94% in senior Finance Leadership positions so I am sure you know all about comparisons, actuals to forecast, actuals to budget, year on year, etc, etc.

So back to the matter at hand. I have encouraged you all and indeed every Client I ever met to Measure. I consider this so important that I enshrined it as Step 1 in my new Training Program. We cannot make any form of comparison until you have taken the very difficult and brave first step to measure your starting point.

Why is it difficult I hear our new Subscribers say? Simple. Go look in the mirror and come back and tell me what you wish to change about yourself. Not quite so simple now is it. Human nature means we only want to measure and engage in comparisons when we perceive that we are already at the top of our game. How many people go on a diet just to join the gym...I rest my case.

In the world of Finance Transformation measurement is the cornerstone of success. You have absolutely no hope of success without it.

However, paradoxically in the 'business as usual' world of Finance team management it is either deliberately skipped or unintentionally missed. I have never in 25 years rocked up to a Client, who has a team in need of Transformation, and been handed anything meaningful by way of performance metrics. Where I do it is abundantly clear, in less than 18 minutes, they never read them, the chap who wrote them left the Business or they contain bugs.

If anyone says we have KPI's...we religiously produce them every 'month end' and we read them out at Board Meetings, please leave this group or Book a support call immediately. I conduct 1 day Challenger sessions for those who think they are on the right track. Bring your KPI's if your brave enough.

Finance teams struggle to measure, firstly due to a lack of will and secondly due to the myriad of system inadequacies which plague Finance teams, particularly those who have never been subject to Transformation. In my view that's at least 65% of the current UK Economy.

It is very easy to blame IT, it is a nice 'get out of jail free card' to play and to me it smacks of excuses. If you want to measure it you will find a way. Spent 4 years training to be an Accountant, rose through the ranks to be a Finance Leader and still using the excuse that the systems are weak? That's like blaming Garnacho when the kid ran his socks off all Season.

Once you have achieved some form of Performance Measurement, either for Finance as a whole or the individual teams causing you a concern, the next step is not to Benchmark. Let me just be clear here do not Benchmark. It is a thoroughly wasteful exercise and is akin to 2 overweight, lycra wearing City fans sat on a bar stool arguing whether Palmer or Haaland is most effective.

You think I am joking? Not once have I ever shown a Client a Benchmark to any noticeable result. In some cases I deliberately withhold them as I know they would demotivate their staff and Motivation is crucial to improvement.

What do we want to achieve? Improvement! Will I do that if on Day 1 I tell you you are overweight, sloppy and will never get off that bar stool? I think not.

Benchmarks in my view are for high performing teams. If you need my help you don't need Benchmarks.

If you want to start the process of Measuring what is important to set appropriate objectives for your Finance Transformation program I suggest you map out headcount, high level process map and volumes for every process. In my experience this can take weeks due to the challenges of data extraction so allow time to do this properly.

Now for the hard part. Take what you measured, place it in story format to describe your Finance team and what it does, bring your team into the room and relay it to them.

When you have done that you will need to update the story by about 30%. Then and only then, show it to an outsider for challenge. You will learn a lot by engaging in this process, over several weeks, as indeed will your team.

Benchmarking to Industry Standard, Good Practice, Best in Class or any other form of comparison is pointless. The only comparison relevant is the gap between where you start from and where YOU want to be.

Still think your Finance function needs comparison to 'Best in Class' Benchmarks?

Cheers,

Michael Ryan.