Is Your A/P Clerk a Knowledge Worker?

Knowledge workers. The hype is everywhere, from Microsoft commercials to Gartner reports. This is the age of the knowledge worker. Just what does that mean? How has the job of the typical Accounts Payable clerk been transformed?

Let's take a little trip back in time to a retail operation I audited early in my career. Their accounts payable department took up one half of a floor in a small office building. The women (yes, they were all women and one of them actually tried to match me up with that nice young single credit manager) had large manual calculators called comptometers on their desks. Every day they would take the invoices received from the retail outlets for products received and check the calculations and the tax. They would then create batches of fifty invoices, attach an adding machine tape and send the stack off to the data entry department to be entered into the computer by another group.

Fast forward twenty years to that same department. There are far fewer accounts payable clerks and the data entry department is long gone. The clerks enter the invoices directly into the computer which does all the calculations so they can just check that the total on the invoice is correct. The system also compares the pricing back to the company's purchase order, another step that used to be handled manually. Have we reached the knowledge worker stage yet? Not quite.

Fast forward to now. There is about the same number of people in accounts payable, but they are handling a lot more transactions because the company has grown. There is no data entry because supplier invoices come into the system automatically via electronic data interchange (EDI). When accounts payable staff sit down at their workstations they see an icon to tell them how many documents are waiting for approval. As they open each document, information about the supplier pops up in a fact window. They can see statistics about the volume of transactions as well as being able to examine past transactions. If they see a large number of returns or problems with documentation, they are in a position to recommend that the supplier relationship be reviewed.

When I asked a Microsoft employee about their view of the typical accounting system user, his response was immediate, "Everyone sees the KPI's" (key performance indicators - i.e. the statistical analysis which measures progress). In this world everyone is a decision maker. Everyone is responsible for their goals. It isn't enough to just show up and put in your eight hours. Everyone is a manager of something.

Is that how you view your accounting staff? The more I think about it, the more I think that is the way to go. Things happen too quickly for all the decision making to climb up the chain of command. Besides, who has the time anyway? You just have to make sure that the internal processes and systems stay in synch. It's pointless to make all kinds of information available to someone who is not in a position to make any decisions. It just clutters the screen. Conversely, it's pointless to make people responsible for outcomes without giving them the information they need.

Does your company employ accounting clerks or knowledge workers? Please leave me a comment.

Systematize / Projectize - Which?

Month end again. The normal processes kick into gear as we ensure there is a good sales cut off, the expense reports have been submitted, the banks reconciled and the overseas operations results are ready for consolidation. On the whole, month end is a well oiled machine where everyone knows what is expected of them. That's the mark of a good system, particularly if all of the processes have been documented and people check them off as they are completed.

Most of the work of the accounting department can be systematized, i.e. turned into a pattern of regularly recurring processes, but what about the surprises? You know, the President is looking at purchasing that little plant in Omaha, you need to have a Sarbanes Oxley review, the accounting software needs to be updated, the Chairman wants a five year forecast, etc. When the accounting staff have their hands full with the system, how do you handle these unpredictable requirements?

The answer is to projectize. Let's face it, even though nobody can predict what surprises lay in store for you next month or next year, you know for certain that they will be there. Why not include them in your planning?

Personal Goals

You know some of the projects that have to get done. In fact, some of them may have been waiting a long time for someone to have enough time to address them. At a recent client, I commented on how enthusiastically one of the staff had taken to the new reporting software. "That's because the new Controller included it in her personal goals for the year," the Assistant Controller said.

"Great," I replied. "What's your goal?"

"Clean up the GL," she said, with a sad smile. It was a big job.

Delegating projects to people is good, but that's only just the start.


Resources, Tools & Time

Of the three techniques available to a project manager, finding the time can be the hardest. Whatever else you do, the accounting system must be maintained. On the other hand, project work can be fun. It's a break from the routine. People get a chance to learn new skills and work independently. What better way to prepare someone for their next career step than to give them a project to manage?

In my experience, the best way to make room in the schedule for project work is to be open with the team about what you are doing. Then enlist their help in finding faster ways to do the normal work, such as automating or eliminating manual processes, getting transactions booked properly the first time rather than adjusting them at month end and reducing any duplications between separate systems. If the whole team is motivated to save time, the results will be much better than a solo effort by you. You might have to make it clear that your objective is only to save time, not to reduce headcount.

Resources and tools are other issues that you have to address. Your team members may need training to take on the projects, whether a formal course or coaching from someone more senior. An outside consultant may be necessary, but encourage your team to work independently. Have them create a project plan and come back to you with any additional resources they think they need. Finally, insist on regular updates and status reports. After all, as head of the department, you are still responsible for delivering the goods.

So, should you systematize or projectize the accounting department? The answer is: both.