Part 1 in the “Continuous Accounting Action Plan” series originally appearing in SAP D!gitalist Magazine.

You’re not imagining things. The pace of change is accelerating, and there are no brakes. The business cycle is now continuous with a speed set to lightning.

Simply put, rapid technological change and digitalization are forcing organizations to reimagine processes, organizational structures, and resource allocations. Every part of the modern enterprise is seeing a shift to a continuous cycle, the acceleration of processes, and the pinpoint measurement of where to improve—whether in marketing and sales, service, or product development.

Finance is no exception. “Continuous” is arriving within every team within it: accounting, financial planning and analysis (FP&A), and directly in the CFO’s office. Why does it matter? Because moving finance to a continuous model creates a more efficient, agile, and proactive function—allocating resources more effectively over the accounting calendar, while building financial planning that is more fluid and operationally relevant.

In accounting, record-to-report processes like reconciliations, reviews, and drafting of results are gradually being subsumed into tasks that occur throughout the period, not just at the end of it. Over in FP&A, forecasting has moved to rolling forecasts that offer more accuracy and are more responsive to a changing business environment. Management reporting and a consolidated perspective view of the financials based on month-end data is no longer good enough; the new expectation is that the data be available at any point during the accounting period.

Finally, measuring the efficiency, accuracy, and level of controls to learn where to improve is no longer a once-in-a-few years—or a never—task. With the business looking to finance for data and analytics, the onus is now on teams to measure and improve continuously.

Essentially, building a continuous finance strategy means creating a journey that spans three areas:

1. Continuous Accounting

This fundamentally encompasses moving account and intercompany reconciliation processes from “period-end,” to “time-of.” However, it also has implications around reporting and rethinking common close tasks.

2. Continuous Planning and Forecasting

Think driver-based planning and a continuous feed of financial and operational data into forecasting models. Integrated planning provides a vehicle for functions to adjust as the operating environment in other functions changes. For example, a decline in a marketing-leads model might mean a change in sales team assumptions, which might impact the top-line revenue forecast managed by finance—and continuous planning can provide faster, more connected feedback than before.

3. Continuous Measurement and Improvement

With the increasing expectation that finance and accounting act as a business partner, and to move up the strategic value chain, it’s never been more important to apply continuous improvement. Whether it’s tracking the accuracy of forecasts (or reconciliations), measuring the speed of report creation (or financial consolidation), or simply evaluating resource allocation devoted to different departments, measurement is key. Also, in such a rapidly changing operating environment, opportunities to improve can vary from month to month.

Creating a Game Plan

We get it—it’s easy to get overwhelmed. Especially when you’ve got a million other things to juggle, from just getting the books closed to getting your head around new accounting rules and regulations. But the good news is that moving to continuous finance is not an all-or-nothing proposition. There are quick wins and more strategic gains along the way.

It starts with establishing a vision, getting initial momentum and success with a win under your belt, and then moving to the bigger areas. That’s why we’ve put together a game plan to overcome the inertia and get started:

Now that you’re familiar with the concept of continuous finance and why it matters to your organization and career, look for our next post, which will dive into how to set your strategy, establish a vision for what success looks like, and get buy-in from the executive team.

Learn More

Read the Ventana research paper, Continuous Accounting Drives Strategic Transformation.