As a growing number of finance functions look to leverage technology tools to increase efficiency and effectiveness, agile processes developed by the software industry are helping finance teams keep projects on track and deliver benefits more rapidly.
Unlike traditional “waterfall” development methods, where a project’s scope is defined at the onset and the final result is delivered at the conclusion, “agile” is an iterative process in which portions of a project are released and refined over the initiative’s lifecycle.
“Waterfall is a great concept, but users often don’t know what they want until they see it,” said Jason Clanton, VP, technologies, for American Express Co. at a meeting of FEI’s Committee on Finance and IT (CFIT).
“Agile lets you chunk a project into components so users get a little bit of the end result, but can tell you if you got that section right….Most people are better editors than creators, and agile helps you iterate and be flexible,” Clanton said
Like many organizations, American Express is undergoing a finance transformation initiative designed to help it support business units and the organization more effectively by streamlining its processes and technology platforms to provide information and insights more effectively.
Scott Nitshke, VP of strategic enablement, told the CFIT meeting the Amex finance team is working to streamline its processes across the finance and business organization, promote collaboration and make faster decisions. As part of that effort, the company is using agile methods and upgrading its technology tools.
“We have a number of processes built around systems that were not designed for finance analytics, and like a lot of organizations, our analytics tool of choice is Excel spreadsheets,” Nitshke said. “We want to move more toward automation and self-service analytics, and we want to invest in tech to enhance our effectiveness and efficiency going forward.”
Nitshke said the company began its transformation effort with a 14-week examination of its reporting processes, metrics and tools to identify gaps and inform a technology blueprint.
“We know the data is there, and we’re bringing it together and developing views of how it fits together,” Nitshke said.
As part of the transformation project, American Express’ finance team is partnering with its IT organization to refine workstreams related to performance management by applying automation and analytical tools to centralize data and reduce reporting complexity.
The company is also consolidating, within the finance function, planning, budgeting and forecasting processes that were often conducted by individual business units.
“We’re looking at a standard process across all lines of business, and an integrated planning process supported by single enterprise-wide application,” Nitshke said.
Agile can be an effective way to manage complex transformation efforts, Clanton said, because segmenting a project provides additional flexibility to meet changing needs without disrupting business functions unnecessarily.
“The technology function wants to get a product right, and the business unit wants a lot of functionality,” Clanton said. “Agile helps you find a balance by promoting collaboration at routine intervals, and to balance the development with the need to meet business functions such as the quarter close.”