If you've ever taken a deep breath and thought, “I wish my accounting department were more effective,” you're not alone. A few years ago, ranking an accounting department for effectiveness simply meant looking at financial capacity and data entry skills. However, the world is evolving and accounting departments need to evolve along with it.
If your accounting department doesn't have the necessary skills to work as a team, you may be at a disadvantage. Stephen R. Covey's book, “The 7 Habits of Highly Effective People,” offers powerful insight into the attributes and habits of these people.
Do you think your concepts can be applied to your accounting department?
Habit 1: Be proactive
To be proactive is to take responsibility. Many people associate being proactive only with members of management or a sales department, but an accounting department is no exception. An accounting department must take control and responsibility for numerous tasks, such as providing timely financial information, safeguarding assets, and preventing fraud. For example, any accounting department can only deliver financial results at the request of management, but a highly effective accounting department can be proactive and deliver those financial results before the due date, in addition to asking tough questions to management, performing critical data analysis for management, and provide dynamic reports .
Habit 2: Have a goal in mind
Covey illustrates that “having a goal in mind” means starting each day, task, or project with a clear vision of the desired direction and destination, and then continuing to flex your proactive muscles to make things happen. An accounting department has many tasks to complete in a given period of time, and all of these tasks must have a judicious path defined in how to carry them out. If these tasks have written policies and procedures in place or only informal steps to be completed, it is essential that the desired objective has been evaluated. For example, a highly effective accounting department, when closing the month, must evaluate the time of each delivery and work to determine the necessary steps to successfully achieve the desired goal .
Habit 3: First the most important
Covey defines this as organizing and executing your priorities. Because an accounting department must prioritize daily, weekly, and monthly and be able to align its critical action items, this routine is filled with tasks to be expected and unexpected. Managing your schedule and workload to focus on those priorities is vital for the department to function effectively. For example, a member of the accounting department receives an unexpected request to execute certain inventory reports for management but is in the middle of closing the month. Therefore, the member of the accounting team must communicate with all parties to be able to properly manage their workload and prioritize which action items will be executed first.
Habit 4: Win X Win Mentality
This can be described as agreements or solutions that are mutually beneficial and satisfactory. An accounting department works with many different people, inside and outside the organization, and those relationships are essential to maintaining effectiveness. The accounting team can collaborate with several other departments, including management, sales, operations, payroll, information technology, and others - sharing information and knowledge can be valuable to both parties. The accounting team may also have important relationships outside the organization with clients, suppliers, bankers, lawyers, or third parties, where maintaining a strong relationship creates a foundation of trust and interdependence. For example, a customer requests that the billing method be modified from regular mail once a month to electronic delivery. A highly effective accounting department will understand the importance of the client's request and will work within the organization to accommodate that request, and as a result, the new process ends up benefiting both parties.
Habit 5: Try first to understand, then to be understood
Covey emphasizes that “seeking first to understand, then to be understood” means to put yourself in the other person's perspective, listening emphatically to both the feeling and the meaning. An accounting department must use communication and the listening component in daily tasks, as it must obtain information by communicating with various parties to perform almost any task, such as financial reporting, customer billing, supplier payments, inventory management, budgeting, and more. Although information can be obtained in different ways, the accountant who listens and understands is vital in the way in which he will utilize and complete the final delivery. For example, a sales manager requests a sales report from the accounting department, which shows specific customer sales data. The accountant listens carefully to the sales manager's requests, asks quality follow-up questions, and provides the sales manager with several examples of sales reports based on the request. The end result is not only a standard sales report, but also a specific and valuable sales report that benefits the sales manager.
Habit 6: Create synergy
Synergy means innovating and solving problems with those who have a different point of view. In other words, synergy can mean “two heads think better than one” and creative cooperation. An accounting department not only cooperates with its own team, but it must also have synergy with all departments of an organization to be successful. An organization's successful management team often has dynamic leaders from all departments who communicate regularly to meet the organization's many needs. For example, the accountant may be entering the weekly payroll data into the Razão, based on a manual process that the organization has been carrying out for many years. What if the accountant consults the information technology (IT) department to find out if there's a way to automate the payroll process? The cooperation and the different point of view may result in an automated process for entering the payroll, allowing the accountant to use their time in more critical areas.
Habit 7: Tune the instrument
“Tuning the instrument” means seeking continuous improvement and renewal professionally and personally. The accounting department must continuously find ways to improve and educate itself in all its functions and responsibilities. Because the accounting sector is always changing, it requires the accounting department to be updated on its discipline. An accountant may train with an immediate supervisor, but may also carry out many activities on their own, such as conducting research and participating in continuing professional education training. A successful accounting department must have varying levels of accountants who are constantly learning and striving to gain more knowledge. For example, the cost accountant has his daily tasks related to inventory and costs, but he occasionally has to assist the budgeting team. The cost accountant is eager to gain more experience in the area of budgeting and attends continuing professional education courses.
Could Covey's 7 Habits of Highly Efficient People apply to your accounting department and create a highly effective team? We believe so!
Contact TATICCA — ALLINIAL GLOBAL, which provides integrated auditing, accounting, tax, corporate finance, financial advisory, risk advisory, technology, business consulting and training services. For more information, visit www.taticca.com.br or email taticca@taticca.com.br. Our company has professionals with extensive experience in the market and has certified methodologies for carrying out activities.
