Life Sciences Accounting & Reporting – Mind the Process Data Gap to Win in 2021 and Beyond

The 17th annual Life Sciences Accounting & Reporting Congress brought together the who’s who of industry leaders to share insights and help navigate the year ahead. From addressing top-line regulatory actions to discovering solutions for industry-wide challenges, the can’t miss event offered technical education coupled with organizational growth strategies. Hopefully the top-notch faculty and industry experts will be back in-person in Philadelphia for next year’s event.

I participated in an “Ask the Expert” panel with PwC’s Michelle Lee, Deloitte’s Temano Shurland and SAP’s Robert Jenkins to discuss practical applications of today’s technologies to finance and accounting, as well as insights on scalability towards tomorrow’s digital breakthroughs to transform accounting and financial reporting.

Two items from the news caught my eye as I was preparing for the session. First, you had Microsoft announce they will be giving away their low-code Power Automate application free with Windows 10 — which has one billion monthly active users according to some estimates. And second, The New York Times did a major story on Robotic Process Automation (RPA) technology which signaled to me the tech is truly mainstream now. Given the audience (and I could not make this up if I tried), the article was titled, “The Robots Are Coming… for Phil in Accounting.”

Looking at the modern finance agenda, it is safe to move beyond the automation talk track of the past few years and explore what’s next and how to get there. Transformation is still top of mind. Everyone is trying to do more with less, leverage new technologies, enhance compliance, improve experience, be more data driven and any of the other targeted outcomes.

What is worth considering is the miserable success rates of major change programs. 70% of digital transformation projects fail, wasting $900B annually. Just 14% of companies have seen sustained and material performance improvements from their transformation programs. And finally, one more statistic, only 1% of organizations have their processes sufficiently under control to realize the full potential of digital solutions.

It really makes you wonder why programs can still get funded at all. I can only think that the potential risk of doing nothing is even greater, and it is seen as a long-term threat to the viability of the organization.

 So what can be done to get better faster?

We’ve been taught over the years that project success relies on people, process and technology. But the shift to a more digital-first approach over the past decade has broken the golden triangle of people, process and technology.

There has been way too much emphasis on technology as the answer to our company’s problems. And that has been at the expense of the people and process dimensions. Technology was seen as the easy button. Go buy a new platform and everything will be better.

I used to regularly conduct technology assessments. In at least 8 out of 10 assessments, where I was brought to explore what was seen as a technology problem. The companies had acquired the right software for their business. The root cause of the problem was actually a process issue or training/people issue that was not addressed properly. But the team was always convinced there was a technology problem.

But it is more than just too much focus on technology. And this is my final point. The biggest obstacle to complex, large-scale change is the lack of detailed knowledge on current state operations.

Companies need to evolve to win the market – and that’s probably more true today than ever before in the current environment. But they truly don’t understand how they operate on a daily basis. They have limited process understanding; they don’t know how their applications and data interact, and they don’t really understand what their customers expect.

And if you step back and think logically, it’s pretty obvious. It’s really hard to go from Point A to Point B if you don’t know where you are actually starting from. Everyone wants to get to that magical future state, but you need to understand current state first.

Before embarking on a major initiative, for it to be successful, a company must map its processes, its systems and its experiences. Today, that necessary level of operational intelligence just does not generally exist in most companies and on top of that it has been traditionally very difficult to obtain, but that is starting to change with emerging technologies which I’ll get into deeper in the break out session.

Most people are probably familiar with manual process mapping and conducting time-motion studies with consultants or business analysts. There are technology alternatives to make this process cheaper, faster and better.