FINANCE TRANSFORMATION: 5 Uncomfortable Conversations A Transformation Lead Should Be Having With The CFO

By Tanbir Jasimuddin, Freelance Finance Transformation Director

The often quoted figure is that 70% of transformation fails to deliver the intended benefits. Industry data backs this up: McKinsey confirms the 70% failure rate for digital transformations[1], and Gartner notes that 55% to 75% of ERP projects fail to meet their objectives[2]. Even more terrifying? 17% of large IT projects go so badly they threaten the very existence of the company[3].

There are many nuanced and complex reasons for this, and even more strategies to overcome them. This is an academic topic in its own right. However, for the purposes of this short blog article, I am going to focus one mitigation strategy.

I have worked with 25+ finance teams. I have seen some very successful transformations. I have also been part of some horrendous programmes. The latter is soul destroying and sucks the life out of you. I try to prevent myself from being put in those situations again by having 5 ‘honest’ conversations with the CFO before the start of the programme. The level of engagement you receive from a CFO will be a huge indicator on the appetite for seeing the journey through to the end.

Conversation 1: The benefits conversation

“Your business case is directionally right but specifically wrong. Headcount savings are overstated. Efficiency gains assume adoption rates that take 18 months longer than planned. The licence cost was accurate but implementation will be 2 to 3 times the estimate because of data complexity nobody scoped. So here’s what I propose: let’s treat the benefits case like a forecast, reforecast it quarterly as we learn more. That’s FP&A discipline applied to the transformation itself.”

Why this works: As per the Kahneman principles, we will always underestimate what it takes to deliver a programme. There will be things that crop up, unknown complexities for example. Data migration and integration are always harder than they seem. We also overestimate our ability to deliver the programme. This conversation is about bringing a reality check. It emphasises the need to remain agile and replan all the way through.

Conversation 2: The valley conversation

“Every transformation goes through a valley of despair. This is usually months 4 to 9 of a 12-month programme. The old system is winding down, the new one isn’t operational, workarounds are everywhere, and you start asking ‘why did we do this?’ I draw the curve on day one. When we’re in that valley, I need you to hold the line with the board and not pull the plug.”

Why this works : This is all about expectation management. Transformation are hard. They are long. Things will always get worse than they get better. Forewarning the CFO prevents panic at the project’s lowest point.

Conversation 3: The scope conversation

“We agree the scope now. Everything else is Phase 2. No exceptions without a formal impact assessment on timeline, budget, and benefits. Because scope creep disguised as ambition is the number one killer of PE-backed transformation programmes.”

Why this works: Dependencies and scope creep stretch timelines and multiply the risk of failure. You must set out your stall to do a few things exceptionally well rather than spreading your budget too thin. You should also set the expectation that Phase 2 MUST happen. Future phases are where you start to see more benefits being delivered

Conversation 4: The day after conversation

“Go-live is the halfway point, not the finish line. Who owns this system permanently? Who maintains the models, trains new joiners, manages platform upgrades? If the answer is ‘nobody yet,’ we’re not ready to start.”

Why this works :You cannot just build a system and abandon the users. The most critical tasks occur after the build is complete. Given the modern pace of change, transformation is a continuous journey for the rest of our careers, not a one-off event

Conversation 5: The time conversation

“This needs 3 to 4 hours a week of your personal attention for the next 12 months. Visible sponsorship, unblocking political resistance, making decisions at steering committees, not dialling in for the last five minutes. If that’s not realistic, we either delay or appoint a deputy sponsor with genuine decision-making authority.”

Why this works : This sets the expectation that the CFO is critical to landing the change. This level of leadership cannot be delegated. The CFO must be all-in. The CFO needs to be ready, willing, and able to dedicate the time required to ensure success

I’d love to hear from you — what has worked for you?

[1] https://blog.mavim.com/why-70-of-digital-transformations-fail-insights-and-solutions

[2] https://www.loganconsulting.com/blog/erp-project-killers-five-things-you-need-to-know-to-avoid/

[3] https://www.hyland.com/en/resources/articles/seventy-percent-not-successful