Guest Blogger Lights Up Business Agility

Guest Post: Business Software System Efficiencies
by Diane Davidson

Industry experts are predicting that merger and acquisition (M&A) activities will continue to be the option for companies looking to scale their operations, enter new markets, or keep pace with technology-savvy startups. A by-product of M&A actions is stranded assets both at the parent company and the remaining company. These stranded assets are the business systems and technology landscape that was left behind during the divestiture process. The epicenter of those systems is the company’s financials and related data. Duplicate business systems and complex technology landscapes lead to higher IT costs and maintenance.

As discussed in my first post-What is financial transformation; the first step is to standardize business practices. Once a company has standardized its business practices, the next step is to identify opportunities to integrate those business systems. The logical starting point is to create a current state landscape of the business environment. The following four steps are:

  1. Systems/Software/Spreadsheets: Identify all systems, software, and spreadsheets that are in scope for the project. To build out the inventory list, I recommend conducting a series of interviews and documenting the current state process.
  2. System Specs: Determine the system’s specifications such as infrastructure (cloud vs. on-premise), version information, discrepancy between the latest version and the company’s version, and the software’s support services. Documenting system specifications is an opportunity to consolidate assets and decommission duplicate systems.
  3. Data Elements: Record the relationship of each business system to the corresponding core process function. Identifying data elements such as accounts payable vendor details stored in each system. Highlight systems that have duplicate or incomplete data elements.
  4. Inputs/Outputs and Flowchart: Detail the inputs and outputs of each business system and how they relate to the other. The data can be a combination of spreadsheets, systematic interfaces, or flat files. The final product is a flow chart that shows how data transferred throughout the organization

Once a current state landscape has been validated and confirmed with the business and IT, the next step is to establish the desired future state system. The future state should be achievable within the next five years. In my experience, designing systems for ten years in the future is not beneficial, given how fast technology is currently changing. A large manufacturing company was on year four of a 10-year ERP implementation, only to scrap the remaining work since the company’s strategy on how to engage with customers had drastically changed.

The future state landscape should support the strategic goals and vision of the business.  If the strategic vision of the company is to expand operations outside the United States, then a focus on financial systems that support multiple currencies and regulatory reporting is needed.  To build the future state, review the current state landscape across the four steps mentioned above to determine areas for consolidation or decommissioning.  Identify systems that are critical to the business as non-negotiables and are core systems for the future state design.  These core systems will act as a starting point for future state architecture and building base requirements.

I have found that many clients are not prepared to leap to the future state in one undertaking, and instead operate using an interim model.  While working in a transitional model, a roadmap is beneficial to keep the project on track to achieve the desired end goal.  A roadmap will detail the key activities that need to be undertaken by the business to bridge the gaps from the current state to the interim and finally, the future state.  A large F500 pharma company operated in a transitional model for a couple of years to limit the change impact on the business and customers.

Through the standardization of business processes, documenting the current state landscape, and building the roadmap to the desired future state landscape, companies are setting the groundwork for a successful finance transformation.

The previous entry in this series: What is Finance Transformation?


I occasionally ask people I work closely with to write guest posts. Diane and I worked together at a client during 2019.  I have a huge amount of respect for her knowledge and ability to make stuff happen. I am glad Diane decided to share a view of business transformation and business agility.

Diane’s bio and contact information.

Clever Fox Advisory was founded by Diane Davidson. She is a results-oriented business professional with over ten years of experience working as a liaison between IT and the business to solve complex problems. She is focused on bridging the gap between execution and strategy primarily by designing and implementing current and future state process models. She has expertise in developing repeatable approaches and frameworks that align with enterprise and IT goals. As a previous Big 4 consultant traveling around the world, she found her final destination point of Chicago, Illinois.

Contact Information: