Agile Finance: Responding to Velocity and Change

In an era of constant disruption, finance functions can no longer afford to be rigid or slow-moving. Agile Finance offers a powerful solution by adapting principles from software development to create a more dynamic and responsive approach.

This shift moves finance beyond transactional tasks into a strategic role that drives business value through innovation and real-time decision-making.

Embracing this mindset allows organizations to thrive amid uncertainty, leveraging flexibility and rapid adaptation as core strengths for sustainable success.

Origins and Foundations of Agile Finance

Agile Finance traces its roots to the Agile Manifesto, originally crafted in 2001 for software development. It emphasizes human-centric values over bureaucratic processes, making it ideal for modern finance challenges.

The core values, when adapted for finance, prioritize individuals and interactions over rigid tools. This fosters a culture where collaboration and customer focus take precedence.

• Individuals and interactions over processes and tools
• Working deliverables like real-time insights over extensive documentation
• Customer and business collaboration over strict contracts
• Responding to change over following a fixed plan

The 12 Agile principles further guide this transformation, ensuring that finance teams deliver value continuously and adaptively.

• Satisfy customers through early and continuous delivery of value
• Finance and non-finance teams collaborate daily for aligned decisions
• Promote a sustainable pace for repeatable processes
• Welcome changing requirements for competitive advantage
• Deliver frequently in short cycles to maintain momentum

Key Characteristics and Benefits

Agile Finance is characterized by proactive thinking, speed, and continual innovation. It enables finance to move from a support function to a strategic driver of business outcomes.

This approach cultivates operational excellence and digital intelligence, empowering teams to influence key decisions with data-driven insights.

The benefits are substantial and measurable, impacting everything from revenue growth to employee engagement.

Organizational Structures for Agility

To support agile practices, organizations adopt flatter, more collaborative structures. This eliminates traditional hierarchies and fosters cross-functional teamwork.

Squads, tribes, chapters, and guilds are common models that enable empowered and autonomous teams to own end-to-end processes.

• Squads: Small, cross-functional groups solving specific problems like budgeting
• Tribes: Collections of squads addressing broader business issues
• Chapters and Guilds: Forums for knowledge sharing and skill development

These structures embed finance directly into business units, ensuring alignment and faster response times to market changes.

Key Practices and Implementation

Implementing Agile Finance requires a shift in mindset and daily practices. It starts with customer-centricity and builds on cooperative partnerships.

Continuous process innovation is essential, moving away from rigid methods to embrace flexibility and trust.

• Focus on reducing transaction time and prioritizing analytics
• Expand FP&A to include financial, operational, and market data
• Automate accounting and finance tasks for efficiency
• Adopt agile funding with fixed budgets tied to outcomes

Building a strategy involves clear steps that emphasize value delivery and transparency.

• Create a strategy statement with defined objectives
• Conduct gap analysis to assess current vs. desired state
• Set progress metrics based on urgency drivers and initiatives
• Focus on simple, transparent processes and regulatory compliance
• Scale from high-impact areas to ensure sustainable growth

Technologies Enabling Agile Finance

Technology is a critical enabler, providing the tools needed for real-time insights and automation. It supports the autonomy of agile teams and enhances digital intelligence.

AI and machine learning drive advanced analytics, uncovering trends and risks with precision.

Robotic process automation and cloud computing streamline operations, reducing manual effort and increasing scalability.

• AI and ML for predictive analytics and insights
• RPA for automating repetitive finance tasks
• Cloud platforms for secure, accessible data management
• Real-time data platforms for instant decision support

Leadership in the Agile Era

Leadership plays a pivotal role in driving agile transformation. CFOs must reorganize teams, select appropriate tools, and upskill staff for new competencies.

This involves fostering a culture of empowerment, where individuals are encouraged to innovate and collaborate across functions.

Key responsibilities include setting metrics that align with agile goals and promoting customer-centricity and innovation at every level.

Challenges and Preparation

Adopting Agile Finance is not without challenges. It requires moving from siloed, waterfall approaches to networked, iterative models.

Teams must expand their skills beyond traditional accounting to include data analysis and cross-functional collaboration.

• Overcoming resistance to change and ditching manual methods
• Maintaining controls and regulations while embracing agility
• Preparing FP&A teams for evolving solutions through self-organization
• Implementing radical changes in budgeting and cost allocation

Preparation involves upskilling staff and fostering a mindset that welcomes experimentation and continuous learning.

Examples and Real-World Impact

Real-world examples demonstrate the tangible benefits of Agile Finance. At Standard Bank, adoption led to more engaged teams and reliable financial numbers.

Sean Berrington, the CFO, highlighted how visualization and communication transformed their processes within eight months.

Studies, such as those by Oracle and AICPA, show that agile leaders consistently outperform peers in revenue growth and innovation.

This approach applies beyond software, with over 25 years of evolution proving its effectiveness in optimizing performance through people-focus.

By embracing Agile Finance, organizations can navigate velocity and change with confidence, turning challenges into opportunities for growth and resilience.