Speaking to The CFO, Ilana Esterrich, CFO at American Coatings Association, shares how digitalising processes has changed the structure of the finance department and offers her advice for implementing new software
Outdated systems and processes not only create difficulties for finance teams but can also negatively impact the future of the organisation. That’s the position American Coatings Association found itself in three years ago.
“When I was bought into ACA, I was told finances are not happy and things aren’t working,” according to Ilana Esterrich, CFO at American Coatings Association.
“It was very clear early on that the issues weren’t about the skills, or the ability of the team to do the work, it was simply that we didn’t have the systems in place to do more advanced analysis, finance and accounting that the organisation was looking for.”
Speaking to The CFO at Oracle NetSuite’s SuiteWorld 2022, Esterrich shares her lessons in automation including how to get the most out of digitalising the finance function, the structural impact upgrading systems has had on the company’s finance department and her advice for implementing new software.
We went to a simplified single chart of accounts for the entire organisation. That was great, that worked, fantastic. Obviously, we’ve had to maybe rename some or maybe add some, and that’s fine, that’s part of a growing organisation.
What we didn’t realise is that we created all these department structures. Everything had a department and there were a bunch of sub-departments with the intent that we would be able to report very specifically. Communications has two or three other sub-departments, which works great for communications, but it doesn’t necessarily work as well for the events.
We thought we were doing a great thing by creating all of this infrastructure that would allow us to report. What we ran into was we didn’t want to budget at those lower levels. It’s great if you can report but if there’s no budget to compare against, then there’s no performance.
We did actually have to roll up and reduce sub-departments, and then leverage custom segments, or alternative ways of reporting. It was done with the best of intentions but then, as we learned the system more, we realised we could do the same report if we structured it differently so we don’t need all of these sub-departments.
The advice I would give is to research, research, research, ask a million questions, and get as many referrals, as many viewpoints as possible before you make a final solution.
The opposite side of that is to document, document, document. Now, I’m getting older and things disappear from my brain, I do need to go refer back to my notes. I have people on my team who can tell me verbatim what I said 150 days ago.
So document, document, document so you remember why you made the decision to do certain things. And also for business continuity because if I get the next best offer or if I lose someone on my team, the next person coming in needs to be able to bolt in very quickly and the easiest way is for them to review the documentation.
When I came aboard ACA, I had a team split between business segments or the different subsidiaries under ACA. Once we implemented NetSuite, it didn’t make sense to do it that way and I kind of flipped the org chart.
Now I have an accounts payable team that supports all of our subsidiaries. […] I have an accounting team that’s across all subsidiaries. Now you don’t have to have a deep knowledge of this silo, you’re able to do your work across all silos. One, it’s more efficient. Two, it was more satisfactory from a professional standpoint, for the accountants, for my AP team. Now I have a cross-section, I know what’s going on across the entire organisation.
It was really kind of a morale booster for them to have a lot more authority at the same time have more autonomy. We did some promotions, we did some reorganisation in the team, and we did grow the team.
I think we’ve reached a stability. We used to be spending about 70% of our time doing closing, entries, data, validating and correcting and checking, cross-checking, and 30% cramming in all of the analysis. We are slowly switching that percentage over where we spend more time doing analysis and thinking things through.
We are also at a point of getting a lot smarter, and I say this loving kindness, getting a little bit smarter about how the organisation should run, could run and so now we’re reaching out as business partners to other departments saying “hey, you know if you did something differently, these are the outcomes…”.
So, I think where we now spend more time is on the strategic side, convincing our business partners that the data can be relied on and that maybe a new way of doing business or a new way of doing what we’ve always done is a better way of doing it. That’s a skill that I would say a lot of finance accounting teams haven’t gained and it’s tough to do that.
Where we spend a lot of our time now is on change management, from education to informing our business partners of how value-added we are. We’re not just about closing the books and putting out income statements, we can actually do quite a bit of analysis with the information that we have.
My role over time has moved from the doer to the manager to really the person who helps set the vision. And then I literally block and tackle to make sure to ask what it means. Whether it’s space and time, whether it’s financial resources, whether it’s staffing to do what they know how to do, that you want to do, and make sure that it reverberates through the organisation.
I spend a lot of time doing change management, I spend a lot of time working with my boss, the President and CEO, as opposed to other senior management team members, and basically starting to plant seeds about change, about ways that we’re going to get more effective. The other thing is I spend a lot of time making sure my team has the training it needs to do all the great things.
I do miss the days of getting in and rolling up my sleeves and my pencil and the eraser but I really do enjoy what I do and I would like to think I do well.
