Purpose and scope

Process Maturity Assessment enables companies to evaluate whether established business processes contribute to achieving strategic and tactical objectives in a consistent and continuous manner. Ultimately, through assessing an organization’s process maturity we derive important insights on the strengths i.e., areas that largely contribute to achieving objectives, and weaknesses i.e., those areas for which improvement measures are recommended.

For the Account-to-Report (A2R) domain, process maturity is demonstrated through synergy between operations and financial management, with business processes mapped and seamlessly integrated with Value Flows. At the highest level of A2R mastery, desired business outcomes are translated into financial and operational resource requirements, and these are incorporated into an integrated business plan. You find below the levels of A2R process maturity according to our Business Flows reference model & stages of excellence.

Account-to-Report Stages of Excellence

Mastery

• Management has a proactive attitude about challenging circumstances impacting the financial health of the company
• The financial managers look ahead to anticipate significant events impacting tax and accounting practices, as well as compliance
• Focus is on achieving efficiencies and perfecting financial management processes while minimising increases in costs and risks
• Complex initiatives are delivered on time, cost and planned level of quality, with very few exceptions
• Finance departments have a deep and broad understanding of the organisation’s cost base and key drivers of different products, services, and intercompany relationships
• Desired business outcomes are translated into financial and operational resource requirements, and these are incorporated into an integrated business plan
• CFO and Executive Team receive frequent and accurate financial information offering continual sights on investments, costs, and product & service delivery

Progressive

• Focus is on monitoring and improving select metrics and service levels in each area of the financial management process
• Deficiencies in current financial management processes are known and addressed in a timely manner
• Finance and accounting functions understand the impact of change on the costs and performance of various areas of the business
• Cost optimization is achieved through a combination of efficiency programs and budget forecasting
• Planning and cost management of moderately complex projects is well established, however, the organization will struggle with more complex initiatives
• Leadership has capabilities in place to steer the organization and is able to react swiftly to unforeseen events
• A trusted system of internal control is in place, and processes for governance are clearly set out and their importance is emphasized to staff
• Operational managers understand the need for financial management and have a basic level of expertise, enabling them to review their budgets and identify the reasons for variances

Basic

• Finance departments are aware of a number of issues with current financial management processes but lack of insight and oversight hinders action towards change
• Financial Managers become aware of potential overspends too late to be able to bring them back into line
• Mechanisms are in place to steer the organization in a familiar and stable environment, but leadership is significantly challenged by unforeseen events
• Internal controls are in place, but at a basic, rudimentary level and are sometimes circumvented • Budgets are frequently over-spent with limited understanding of the causal factors and limited capability to enforce corrective actions
• Daily operations run but data collection and data integrity cause delay in closing process, reporting and analysis
• Financial plans are limited in time span, typically a one year cycle
• Line managers have little understanding of the interdependencies between operations and financial management processes

Maturity Dimensions

We have defined six dimensions of mature processes for Account-to-Report namely.

Process Efficiency
Systems standardization and integration
Strategic Objectives and KPIs availability
Data quality and availability
Process performance and compliance transparency
Staff empowerment

Process Efficiency measures how much to-be processes of the business contribute to achieving process efficiency and the application of internal control standards. Systems standardization and integration deals with whether existing system capabilities are utilized owing to integrated and process-design guided implementation. Strategic Objectives and KPIs address the question of whether the company has defined the right Key Performance Indicators and established precise, comprehensive, and timely reporting. Assessing Data quality and availability seeks to uncover whether data available to the business is reliable and readily accessible with clear guidelines and responsibilities for governance. The last two dimensions scrutinize if Process performance and compliance transparency are supported through defined and implemented process indicators or controls, and Staff empowerment is fostered by leadership, respectively.

Maturity Assessment Questionnaire

We assess the maturity dimensions across 10 process areas

We use a maturity assessment questionnaire to collect the information relevant for conducting the assessment. The questionnaire is structured in a form that considers the different areas of the business for which we are undertaking the maturity assessment. The Account-to-Report (A2R) maturity questionnaire is divided into 10 sections representing 10 relevant process areas as defined in our Business Flows process reference model. These are General Ledger, Accounts Receivable, Accounts Payable, Asset Management, Bank Accounting, Tax Accounting, Cost Accounting, Project Accounting, Period End Closing, and Treasury.

For each of the above-mentioned sections, we have derived statements that allow the collection of responses pertaining to the 6 aforementioned maturity dimensions. As an example, the illustration below shows the maturity questionnaire for Account Receivable (AR).

Process Efficiency	Systems standardized and integrated	Strategic Objectives and KPI defined, measured and reported	Data of high quality and availability	Process perfomance and compliance monitored	Staff empowered
Our AR processes are robust and streamlined, ensuring accurate and efficient invoice creation	Our Sales, Financial and Cash management systems are integrated and standardized across the enterprise	Our AR reports are open, clear and concise for internal and external users	Financial managers have access to AR data that is up to date, readily available and reliable	Compliance with AR policies is measured and monitored	Our staff is provided adequate initial and refresher training
Our AR collection process is clearly documented, monitored, and integrated with the organization’s strategic and corporate planning processes	Our systems produce standardized reports of AR for every entity	Appropriate financial and non-financial indicators for AR are covered within the monitoring and forecasting reports such as operational reports, management reports	AR master data is current and audited periodically	Deviations from standards are investigated and corrective measures put in place	We empower our staff to behave in accordance with our company values, laws and regulations, and ethical standards and report fraud or errors without repercussions
We maintain accurate payment records for all customer accounts	Our AR transactional processing systems are functional and integrated with the enterprise data repository	Defined performance indicators for AR are established and used to evaluate costs and benefits and to inform key stakeholders		AR balances are reported in accordance with international accounting standards for accurate balance sheet reporting	Our staff is aware of their role in the End-to-End process and the integration with other areas (e.g. Sales)

Assessment of results

With the collected data from the questionnaire, we are able to provide a diagnosis of the level of maturity for each dimension as is depicted below. We also, in addition, pinpoint target maturity levels and those areas for which improvement measures are required in order to reach the desired outcomes. We then provide clear recommendations for process improvements across the process areas.

Our offering

Our Process Maturity Assessment offers you the opportunity to evaluate whether the established procedures in your company contribute to achieving strategic and tactical objectives in a consistent and continuous manner. We guide you through all steps of the maturity assessment, and ultimately shed light on the areas that require improvement measures, and how best these measures can be implemented. We help you by providing:

A Process Maturity survey
Advisory and support for survey respondents
Evaluation of survey results and diagnosis of process maturity
Detailing of action items and the road map required to achieve desired process maturity

For inquiries on the A2R maturity survey and how to conduct an assessment for your organization please feel free to contact me.