2019 Au WP Driving Digital Cultural Change LR

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How to drive a culture that embraces

digital tools to improve productivity and


compliance
Table of Contents

3 Introduction

4 Pros and cons of a full-scale rollout

5 The growth opportunities provided as a


result of digital transformation

6 The importance of change management

8 Advice for organisations on the


cusp of digital transformation

10 Taking a proactive approach

11 Driving a digitally-enabled culture

12 Culture change in action: a case study

14 Gareth Thompson’s tips to successfully


change the culture to encourage digital
adoption

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Introduction
As companies look to transform and unlock the business benefits of digital
tools, compliance and governance must remain top of mind. The business world
is becoming more regulated rather than less, and complying with all the different
requirements can become burdensome if processes are manual and paper-
based. Consequently, many organisations start their digital transformation
journey with tools that can help improve productivity and compliance.

This can be counter-intuitive for some In May 2019, SAP Concur held an executive
organisations who find that the biggest barriers to roundtable in Sydney, Australia. The participants
innovation and adopting new tools comes from the included senior finance executives from a range
compliance team. Yet, despite fears to the contrary, of private and public-sector organisations. They
existing and emerging technologies can make the discussed the pros and cons of full-scale technology
job of compliance and internal audit teams much rollouts versus a phased approach, the importance
easier by automating many of the related functions of change management to ensure the success of
and lessening the burden of work. new rollouts, cultural barriers and how to overcome
them, and advice for other organisations considering
Specifically, cloud-based tools that can help adopting adopting digital tools.
monitor and manage company expenditure,
including travel and related spend as well as This whitepaper distils the views and experience
procurement and accounts payable, are making shared at the roundtable, and focuses on how
it easier for organisations to encourage policy organisations can create a culture that embraces
compliance from staff members, as well as free digital tools for productivity and compliance.
them up to be more productive.

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Pros and cons of a full-scale rollout
Some organisations go all-in on a digital technology A mandated rollout can work well when the project
project. They implement the solution then mandate team has the support of the CEO, who can ensure
a company-wide rollout in which all users are reluctant users toe the line. However, when CEOs
switched to the new system more or less at the are inconsistent in enforcing this message, such as
same time. Other organisations take a phased letting some valued or legacy staff members get
approach, bringing in change in a staggered away with not complying, this can risk the success
process to achieve what stakeholders want without of the overall project. Therefore, a consistent
putting undue pressure on users. message is essential.

Each approach has value depending on the nature For a phased approach, some roundtable
of the organisation, the business-criticality of the participants used influencers and test cases in their
tools being introduced, and the willingness of organisations to implement change. They ran pilot
stakeholders to accept the change. programs, got influential users up and running first,
or gave people plenty of time to get on board.
A mandated approach can work as long as the
initiative has top-down support and the project For example, when rolling out their SAP Concur
team has successfully sold the story of what it travel and expense management solution, some
intends to achieve. This can help get all the users organisations advised employees that failing to
on board early enough to make the mandated complete their expense reports using the new
rollout succeed. system would, after a generous grace period, result
in company credit cards being suspended. The
In some cases, the benefit of the new technology is participants found that this only needed to be done
so significant that it outweighs any inconvenience once or twice before the affected users told everyone
or fear of change that may hamper its full adoption what had happened. People submitted their
by users. Businesses are driven by the need to expenses on time using the new system after that.
create shareholder wealth, so they can’t in good
conscience continue to rely on legacy systems and Participants also used a reward rather than a
approaches when it’s clear that they’re costing the punishment method by rolling the solution out to
business money. enthusiastic members of the team who would then
talk about the new solution with their colleagues.
And, while it can be easier on the affected users This watercooler approach was also successful and
to do a slower, more phased rollout, it can also be most participants agreed that a mixture of the two
incredibly painful for the project team. was most likely to result in the desired behaviour.

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The growth opportunities provided as
a result of digital transformation
Efficiency to managing invoices or chasing receipts.
The increased visibility delivered as a result of Automated systems that can help manage these
digital tools has let organisations make smarter processes are, therefore, highly valuable.
decisions around spending and cash flow. This
is key from a procurement perspective, where Furthermore, by introducing apps such as SAP
gaining the data to understand where the Concur and others, organisations can help
money is being spent can drive better decision- staff members make smarter decisions in the
making. Companies can choose to do business in moment by offering real-time data. This lets
different ways, with different providers, and use businesses operate at the speed of the market,
the data to negotiate better deals. making changes or seizing opportunities while
there is still an advantage to be gained.
Furthermore, automated processes around
expense reports and invoice management can Improved customer experience
free up people’s time. They no longer need to Streamlining business processes lets
focus on these low-value administrative tasks organisations innovate to deliver a better
and can, instead, focus on contributing to customer experience. And, real-time reporting
business growth. lets business move faster to improve the
customer experience. If a product isn’t working,
Employee retention the organisation can see that in real time and
Today’s employees want flexibility in terms of make changes. This can include moving the
where they work, how they work, and the tools product to a higher-trafficked area of the store,
they use for work. Providing this capability offering discounts on online services, or ordering
is a minimum requirement for organisations more of a product that’s selling well.
looking to attract and retain top talent. Digital
transformation provides the tools that Most organisations agree that the future of
employees expect, letting them contribute growth is in digital products and offerings.
meaningfully to their role instead of focusing on Moving to a digital platform opens up the
data entry or other mundane tasks. potential for increased analytics and faster
decision-making based on proof instead of
From a finance perspective, staff members will instincts.
be more engaged and valuable if they can spend
their time on analytics and strategy as opposed

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The importance of change management
All roundtable participants agreed that change employee feedback plus showing that it acted on
management is nothing less than crucial to the the feedback and designed the solution to meet
success of a technology rollout. Setting policies, employees’ needs. Even if the solution wasn’t yet
rules, rewards and punishments worked best if perfect or was just the first step in the journey, by
the project team was able to sell the benefits of communicating this to employees, it was easier to
the solution to the broader organisation. Just get their buy-in and their active participation
demonstrating that the solution could save the in the rollout.
company money, reduce operating costs, or open
up new opportunities was far less effective than Clear communication is essential in change
demonstrating how it would affect individuals management. In any new technology rollout, a
on a daily basis. small proportion of employees will be excited
about the change and act as early adopters. Most
Finding the key benefit that will appeal to each employees will be happy to follow once these early
user is crucial to an effective change management adopters have proven the value of the new system.
strategy. Tools that aim to improve compliance, And, there will always be a small proportion of
for example, tend to be dismissed by many people who are highly resistant to change and may
users because compliance isn’t part of their job never come fully on board with the new solution.
description or their KPIs. By showing them why
they should care and how their lives would be made The trick to providing a level of comfort regarding
easier by embracing the tool, project teams had the solution to most of the users within the
more success in encouraging widespread adoption. organisation is to clearly communicate the
solution’s benefits in ways that make sense to them.
The concept of taking employees on a journey This extends to providing comprehensive training in
is key in managing change effectively. It can be various formats to demystify the solution and help
valuable to conduct a survey before implementing users feel in control.
the solution. This can help identify pain points and
find out what kinds of solutions staff members are Some organisations find it useful to do a
most likely to prefer. Then, when rolling out the countdown to the new solution, providing a new
solution, it can be helpful to draw a line back to the snippet of information each day until the solution
survey results to demonstrate that the new system is rolled out. This can create a level of familiarity
addresses those pain points. with the new system that means, on day one, the
changeover is less jarring.
This approach offers the double bonus of
demonstrating that the company listened to the

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Cultural barriers and solutions Furthermore, it can be valuable to view diversity not
While it’s often said that millennials are the fastest- as a barrier to cultural change but as a contributor
growing group in the workforce, most organisations to successful change. By treating each group within
are working with people from a diverse range of the organisation according to their readiness to
backgrounds and demographics. This means that embrace new technologies, the project team can
there’s no one single way to build a strong culture take them on a journey that, while unique to each
that embraces change. Therefore, the project team group, ends at the same destination; with the new
must understand the different types of diversity system being used effectively.
in the organisation and determine how best to
communicate with those people. Legacy processes
Sometimes, culture is entrenched and hard to
Age-related diversity overcome. This can be seen in organisations where
Stereotypically, younger workers tend to be more at many of the senior staff members are used to
ease with change than older workers. Organisations having processes done for them by assistants.
can tap into this by getting younger members of Rather than complete an expense report each
the team using solutions first, so they can start month, for example, these staff members are used
to influence others. By contrast, those who have to simply throwing all their receipts into a shoebox
been in the organisation for a long time may be before handing the whole box over at some point
more resistant to the change. Organisations can for the finance team or their assistant to sort
transition the change-ready members of the team through. Introducing a solution like SAP Concur
to the new solution first, then slowly work with the can be harder in these cases because it doesn’t
change-resistant team members to make the move actually make the staff member’s job easier. If, in
less confronting for them. the past, they did nothing at all to manage their
expenses, then even taking a photo of a receipt may
Often, the most successful approach comes from feel like an imposition.
understanding what drives one individual. While
it’s not always possible to hold each person’s hand In these cases, it’s usually preferable to take a
through the transition, it can be useful to find phased approach that gives people plenty of
the right levers to help the most resistant people time to get used to the idea of the new system.
come on board. In many cases, success comes Overcoming the cultural chasm in one attempt is
from just listening to the individual’s concerns unlikely if it’s an extreme transition.
and demonstrating that they are important to the
business. To drive cultural change, therefore, it’s essential
to first understand the cultural barriers in place.
Educating each of these laggards individually, while Whether those barriers are related to workplace
time-intensive, can pay off because the education demographics or legacy processes, understanding
and support provided to these people can, in them is the first step towards overcoming them.
many cases, turn them into fierce supporters Overwhelmingly, the most successful projects were
and proponents not just of this project but of all those where the team understood the cultural
future projects driven by the finance team. Finding barriers and took an individualised or group-based
project champions within each demographic approach to addressing them in a sensitive way.
in the organisation can pay dividends as they
communicate the benefits to their peers.

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Advice for organisations on the
cusp of digital transformation
Often, finance-led projects are the catalyst for other changes.
For example, SAP Concur tends to be introduced as a
travel and expense management tool that evolves into an
overarching accounts payable and spend management system.
Getting people used to small changes before asking them
to accept wholesale transformation can help train them to
embrace change.

Organisations considering introducing compliance and


productivity tools must have a clear change management
strategy that accounts for the individual concerns of users.

Some of the key concerns that organisations should be ready


to address include:

Fear of obsolescence
A decade ago, workers were afraid their jobs would be
outsourced to offshore providers. Today, workers are just as
likely to fear that they’ll be replaced by technology, especially
as robotics, artificial intelligence, and automation attract more
attention across the board.

It’s not unreasonable for workers to be worried that a new


technology that streamlines or transforms processes could
make their jobs redundant. However, while this may be the
case in some limited situations, the truth is that transformative
technology is more likely to make their jobs more enjoyable,
varied, and strategic.

Framing a new technology as a tool for removing the manual


and tedious parts of the job, freeing up the employee to focus
on value-adding and creative tasks, can help overcome this
fear of becoming obsolete.

Fear of Big Brother


Productivity and compliance tools tend to provide more
opportunities for accountability and career progression, so it’s
important to ensure that employees understand that they’re

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not being implemented as a kind of Big Brother simple as taking a picture of a receipt and letting
spying tool. Instead, the aim of these tools should a technology solution do most of the rest of the
be clearly communicated; they’re about removing work, people can feel worried that something might
low-value work from people’s days while making get lost or the system might fail, leaving them in a
it easier for the organisation to meet compliance difficult position.
requirements.
However, a system that facilitates compliance is
Accountability can seem worrisome to staff likely to provide even more control to people, albeit
members who see it as the organisation potentially in different ways. For example, when requesting
punishing them for doing the wrong thing. Again, a budget for a business department, the team
it’s important to make sure these employees can use a solution like SAP Concur to identify
understand the whole story and the impact on the what spending has taken place in the past for
business if they don’t comply with requirements. that department. They can identify out-of-policy
To do so, project teams will need to follow the expenditure or opportunities for cost savings, then
argument to the end. make that part of the budget discussion. It may be
that, instead of a budget increase, the department
For example, if the conversation is about doing can actually claw back some unnecessary spending
expense reports in a timely manner, the key just by complying more closely with company
message may be that the business can’t charge policy.
expenses to clients if the expense reports aren’t
completed. That means the organisation has With the visibility and data analytics provided in
to carry those expenses, which can impact the these solutions, decision-makers can have more
bottom line. If expense reports are submitted control than ever before.
accurately and on time, then the organisation can
get reimbursed by clients faster. This improves the Fear that spending will be unfairly
bottom line and can mean that the organisation curtailed
can pay bonuses and provide salary increases. Most organisational leaders understand that
Making the benefits personal is crucial. spending is an important and inevitable part of
running a business. While cutting costs is usually
In some organisations, the finance team has a key goal for most organisations, that doesn’t
shared expense reports with general managers to necessarily have to happen at the expense of
demonstrate the real effect it has on their profit- reasonable and responsible spending.
and-loss statement. Providing this awareness to
leaders lets them decide, based on their unique Implementing a spend management system
knowledge of their team members, how to facilitate will deliver increased visibility into spending
change. habits and help identify opportunities to cut
unnecessary costs. This lets managers and even
Fear of loss of control individual employees become part of the broader
Relying on a technology solution to help manage conversation around reducing costs while still
compliance and productivity can leave some spending appropriately. Rather than waiting until
team members and managers worried that the end of the financial year to see this information,
they’ll lose the control they once had over those a digital tool provides it in a far timelier fashion, so
processes. When doing an expense report is as these discussions can be had earlier for the results
to be seen sooner.

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Taking a proactive approach
As well as addressing people’s fears around the Partner with the business
new technology, it’s also important to take a For finance teams rolling out compliance-based
proactive approach to encourage the widespread solutions, it’s important to partner with other areas
and enthusiastic adoption of the new technology. of the business including the technology teams.
Some of these methods include: With the technology team on board, it’s possible
to do a blanket download of the app. This avoids
Rules and policies having to rely on people to download it themselves.
While it’s usually preferable to focus on the
positives of embracing the new technology, a Some businesses also create partnerships
stricter approach can also help hasten full between different members of staff so a person
adoption. For example, many companies will not who is familiar with and supportive of the solution
pay personal expenses until people have processed can help someone who may be struggling to get
company expenses. Or, if expense reports aren’t the app up and running on their own device.
submitted on time and in full, company cards will
be suspended. Embrace feedback
During the pilot phase, it’s important to get
Failure to submit expense claims is one of the feedback from people who know nothing about
first signs of fraud, so it’s important to nip this the project, the solution, or its aims. This can help
habit in the bud to separate potential fraudsters expose how easy or intuitive the solution is to use
from those who are genuinely just late with their even for those with no knowledge of the processes
expenses. it’s designed to transform.

It’s important to note that, in the vast majority of It’s also important to include the documentation in
cases, issues arise not because of the process but the feedback loop so people can provide feedback
because of people’s behaviours. Therefore, the on how well the supporting documentation fits
biggest challenge is to influence people’s behaviour their needs.
rather than change the process.
Gamify the process
Create a pilot group Human nature responds to incentives.
Having a pilot group use the solution before it’s Gamification can be a positive way to elicit the
rolled out widely can help identify any potential desired behaviours, whether it’s a prize for the
issues with the solution as well as articulate how business unit with the fastest take-up of the new
the solution helps. It’s important to make sure the solution, or recognition for the first person to
pilot group is diverse, incorporating people across submit their expense report using the new system,
various departments, demographics, and seniority or some other incentive.
levels. It’s useful to include heavy users as well as
light users to get the full gamut of feedback from
the pilot group.

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Driving a digitally-enabled culture
One of the common themes among so-called enabled culture. Visibility and transparency are
transformation projects is that the digital tools essential at every step, and the value of a strategic
aren’t necessarily as transformative as people change management program can’t be overstated.
think they will be. However, with the right tools to
drive compliance and productivity, organisations There are five key steps business leaders must
can transform the way they operate. For example, take to successfully introduce digital tools in the
automation can be transformative as long as it’s not organisation. These are:
simply automating an inefficient manual process. 1. Make sure everyone in the business
understands why the change is being made.
Boards are becoming highly sensitive to the 2. Set performance targets and align incentives
concept of transformation and, if other companies around the new initiative.
in the same industry are transforming, it’s 3. Build the right skill sets and capabilities,
important to ensure the company keeps up. This incorporating a diverse group of people in pilot
has been seen in the transition to cloud, which projects.
was once seen as risky and is now commonplace 4. Run a consistent, structured program with
throughout corporate Australia. As transformation reliable support from the top of the organisation.
continues to gather pace, more organisations 5. Look for growth opportunities rather that cost-
will be looking for ways to transform so they can cutting measures to ensure the future viability
unlock the significant benefits their competitors for the organisation.
are seeing.
By taking these steps, organisations can drive a
To achieve successful transformation and fully digitally-enabled culture that sees compliance
embrace digital tools that drive productivity and and productivity become easier and more assured
compliance, it’s essential to drive a digitally- across every role in the organisation.

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Culture change in action: a case study
Gareth Thompson, a senior finance executive, Achieving success through change
recently managed a significant transformation management
project at a large Australian organisation. Gareth designed a multi-faceted change
Looking to move away from manual processes, management and training plan that aimed
his organisation identified travel and expense to leverage existing strengths and cultural
management as two key areas for transformation. expectations in the organisation.
SAP Concur was chosen as the solution to address
this and the rollout brought about significant Gareth Thompson said, “Nine times out of
change for the organisation. 10, change management is underestimated.
Businesses either don’t take enough time to really
Key challenges understand the culture and work styles within the
Rolling out the new system created cultural organisation, or the project team assumes it has
challenges due to the nature of the workforce. enough knowledge to make decisions. Then, the
While there was a diverse range of age groups within project often kicks off without really mapping out
the workforce, there was also very low turnover. how the change will be managed.
This meant that some staff members had been
at the business for 30 years or more. They were “It’s essential to frontload the change management
entrenched in the processes they had grown used to, effort at the beginning of the project. The team
so they were hesitant to adopt something new. needs to take enough time to really understand
the organisation’s needs and how the changes will
With a large administrative team and support staff, affect all the different user groups. Then, the team
along with processes that had evolved to make needs to carefully construct and release consistent
life easy for frontline staff, most team members and informative communication pieces that let
weren’t used to a self-service model. However, as people feel like they’re part of the journey and help
with many digital transformation projects, the SAP them understand why the changes are being made.”
Concur implementation was designed to increase
employees’ self-service capabilities and decrease Gareth groups change management into two broad
reliance on administrative staff. This was seen as buckets: communications; and training and support.
potentially adding a workload burden by those staff
members who hadn’t previously been required to Communications
manage travel or expenses. It’s important to get key stakeholders on board with
the project as soon as possible. Gareth started his
Furthermore, creating an expectation of higher project by interviewing key stakeholders to get a
accountability and better visibility into expenditure clear and comprehensive picture of how different
made some staff members exasperated at what user groups worked. This provided invaluable insight
they saw as a curtailing of their autonomy. into what these groups would need in a new solution.

12 / 15
Gareth said, “We thought we knew how the Gareth and the team also built customised training
business operated. But by speaking with these materials for the new technology that turned out to
people it became clear that there was more be an unnecessary investment.
information and more insights to be had.”
Gareth said, “We created written user guides
Change management involves not just teaching and even some videos. However, in hindsight the
people to use a new system but, potentially, videos were expensive and not well-used, so they
changing their work-related behaviours at a basic didn’t add value. The custom user guides were
level. Therefore, it’s essential to show them why useful for the first few weeks. However, as soon
they should make these changes and how they’ll as the solution was updated, the user guides
benefit. A strong communications plan is the only became slightly out of date. In retrospect, we
way to do this. could have just used the user guides provided by
SAP Concur and supplemented that with our own
There are two types of communication at this stage. communications.”
The first is proactive communications where the
team needs to sell the project and its benefits, get During the training period, some users provided
people excited, and set reasonable expectations. feedback in the belief that the solution could be
tweaked. This demonstrated to Gareth’s team the
The second type of communication is reactive importance of managing expectations around
and involves addressing people’s concerns. These what people could influence and what they needed
communications need to be carefully managed and to accept.
sensitively handled to convert potential naysayers
into project supporters. Gareth said, “Before the project starts, it’s important
to understand how much you can let people
Training and support influence processes to suit their needs and where
When designing the training and support you need to take a hard line with some processes.
program, Gareth leveraged influential users in Too much flexibility is inefficient but too little
the organisation. Asking people to nominate flexibility can lead to discontent. If the business is
themselves as super users, Gareth and the team taking a hard line, it’s essential to communicate this
were able to use a train-the-trainer approach to upfront along with the reason why, so people can
minimise the jarring effect of the change on the understand why they’re being told no.”
workforce.
Managing change after the
Those who nominated themselves to become implementation
trainers were often, but not always, younger people It’s a mistake to think the change management
in the business. They were excited about the team’s job is complete after the system goes
transformation and willing to help the people in live. Gareth and his team sought comprehensive
their business units come to terms with the new feedback from the business six months after go-live.
technology. This gave people someone local they The feedback helped confirm that the program was
could turn to if they had a simple question. successful and it also provided learnings that could
be applied to the next technology implementation,
putting the business ahead of the curve.

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Gareth Thompson’s tips to
successfully change the culture
to encourage digital adoption

Do
• Frontload the effort and resources at the • Split the implementation where possible
beginning of the project to ensure it’s on the to minimise change fatigue. This could mean
right track from day one. implementing some functionality six or 12
• Resource the project with dedicated change months later.
management experts who know what • Make it clear whether you’re offering
they’re doing. training versus asking people for feedback
• Take the opportunity to improve and input.
workflows, governance, accountability, and • Get feedback six or 12 months after go-live
supplier relationships rather than simply to ensure the solution is still working well
overlay a technology solution onto existing and to get insights to help you manage the
processes. next project more effectively.
• Leverage influential people in the
organisation to manage training and support
programs.

Don’t
• Underestimate the value of change groups depending on where people are
management. located and the nature of the work they do.
• Assume you know how all the users in the • Invest in expensive resources to support
business operate and, therefore, what kind the implementation before thoroughly
of solution they need. reviewing the vendor’s materials. You may
• Apply a one-size-fits-all approach. Instead, find you have to do less work than you think.
use a different approach to different user

Gareth Thompson is a senior finance executive with twenty years’ experience across both the
Government and private sectors. Having spent ten years as an auditor, he has since leveraged that
experience in the corporate accounting world to deliver high quality, innovative and efficient financial
services using best of breed ERP systems and complimentary products and services (cloud-based or
on-premise). He is an expert in leading teams to transform business processes with incredibly fast ROI.

14 / 15
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WP digital transformation tools enAU (14/06)

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