Nailing It! Secrets Behind Process Improvement in Finance

  • By Liz Briggson
  • June 22nd, 2021

It’s no secret that companies are investing in technology at the expense of traditional departmental budgets laden with personnel expenses. A 2021 Gartner survey showed that companies are expecting to drive business growth through the use of technology, and functional budgets would be decreased in order to fund these growth initiatives. What does this mean for financing and accounting professionals? 

Nancy Wu, Head of Sales and Customer Success with SkyStem, recently led a one-hour webinar discussing “Nailing It! The Secrets Behind Process Improvement in Finance.” Read on to identify how finance and accounting teams can re-vamp processes with and without technology to achieve marked improvement. 

Lead Change

Change management and leadership underpin effective process improvement. By definition, process improvement involves disruption of the status quo. The entire premise of the famous business book Who Moved by Cheese highlights how most people feel about change – they don’t like it. It seems like us humans are naturally wired to embrace the current state and ‘like things as they are.’ Acknowledging these biases before embarking on a new initiative will save time and reduce organizational friction.

Process improvement is just as much about people as it is about the actual process. If you are already contemplating how things can be done better, that makes you a change agent. Successful change agents know how important it is to bring in the right people early in the process.

Strong leaders know the value of setting clear expectations by communicating the project timeline and desired outcomes in advance. Take for instance Karmen, an accounting manager who has recently joined a new organization. Management explains the month-end financial close process is inconsistent and lengthy. Karmen is tasked with improving the close process. This situation is challenging in that Karmen needs to build trust with her new team while at the same time advancing change initiatives. This is where facts and data are invaluable.

Capability Maturity Model

To help provide an objective baseline for the current state of how processes are operating, Nancy Wu introduced the Capability Maturity Model. The model was created by the Department of Defense in the 1980’s to measure the degree of maturity for a given process. The model has been used for decades to identify process improvement opportunities. Using an assessment tool provides an objective marker for teams to work from when identifying processes to improve.

The Capability Maturity Model lays out five levels of process maturity.    

Level 1 - Initial: At the ground level, processes are undocumented, and activities have no sense of predictability. At this level, those involved are still figuring out how to do the work. 

Level 2 – Repeatable: Processes now have a sense of normalcy; however, they are not rigorously executed.

Level 3 – Defined: Processes are standardized with established process steps that are typically documented. At this level this is reliable consistency in execution.

Level 4 – Managed: Once a process has reached this level, measurable service levels exist to monitor performance. 

Level 5 – Optimized: At this level the process becomes a competitive advantage because the results of a Level 5 process are beyond what peers can achieve. Level 5 processes are continuously undergoing optimization and improvement.

In Karmen’s case, she utilizes the Capability Maturity Model to perform an objective assessment of her new organization’s close process. She finds that the books are closed each month, but the team sometimes takes 9 days to produce a set of books and other times 12 days.  

Karmen shares with the team her assessment of their current state: Level 2 – Repeatable. The good news for Karmen and her team is that a Level 2 process has the greatest opportunities for improvement. Nancy shared that at this stage, “Small changes can make big improvements to efficiencies.” Karmen and her team decide that their first process to improve is their use of a month-end close checklist. 

The team has another decision point: Should they advance the close process to a Level 3 process, or leapfrog to Level 4? Automation is generally required to achieve the hallmark monitoring and metrics that signify Level 4. 

Karmen and her team will want to determine how closely a smoothly running month-end close process fits with management’s objectives (a high priority!). They will also consider their time constraints and budget. Karmen can get the team on-board by highlighting how a repeatable close process can help the team better plan for their lives outside of work, even during the close timeframe.

With budget approval to identify and implement a software platform to support the team, Karmen knows they can achieve a Level 4 Managed process. The team will start with small changes to create process efficiencies and ultimately adopt technology to eliminate the manual nature of a static checklist.

Room for Improvement

The finance and accounting industry is ripe with opportunities for improvement. A joint Deloitte / Institute of Management Accountants survey found that less than 25% of accounting processes are largely automated at the companies surveyed. A majority of those same companies are looking first to implement budgeting, forecasting, and reporting tools as they consider their upcoming technology investments. The survey showed that financial reporting and GL/close activities are the top areas that can benefit from technology and automation.

Whether you are new to your team like Karmen or if you have been on your team for 20 years, there are likely many process opportunities for your team. Remember to conscientiously acknowledge process improvement as a discipline that requires change management and leadership. Bring your team along with you and prove your value as you look for opportunities to enhance your organization.

We invite you to join us on July 13 for SkyStem’s upcoming webinar:  Combat Fraud Through Month-End Close.

About SkyStem
Headquartered in the heart of New York City, SkyStem delivers a powerful month-end close solution for organizations seeking to streamline their financial processes. The company’s flagship solution, ART, is an enterprise technology that helps CFOs and Controllers shorten the month-end close and the time to issue financials by automating balance sheet reconciliations, managing month-end tasks, performing flux / P&L variance analysis and providing insightful reporting. The web-based solution streamlines and eliminates up to 90% of manual activities while strengthening internal controls and corporate governance.

Visit to learn more. 



  • Process improvement
  • month-end close
  • capability maturity model
About the author
Liz Briggson
Liz Briggson

Liz is a licensed CPA in the state of Michigan and a member of the Encoursa team. Liz also provides business valuation consulting services and is actively involved in the Grand Rapids, MI business community through the Association for Corporate Growth.

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