By David Allen
The last few years have been characterised, in the private sector at least, by a shift away from the old ‘command and compliance’ style of management to the new ‘trust and commitment’ style, and my ‘Managerial megatrends’ course highlights the implications of that shift, and how it affects financial control.
Two of the megatrends identified in the course were:
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that from a culture of conflict to one of collaboration (across the functions, and with customers, suppliers and employees), and
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that from a top down and centralised approach to a devolved and localised one.
Nevertheless, it came as a surprise to see the establishment of a coalition government (itself an example of collaboration) and, even more so, to see the emphasis its leaders are putting on getting away from centrally dictated policies and targets, and empowering local organisations on a ‘we are all in this together’ basis.
However, my experience has been that majoring on a couple of the trends, and glossing over the others, is fraught with difficulty; the shift, in other words, needs to be an ‘all or nothing’ one. What comes as a shock to many accountants is the realisation that the traditional accounting model developed in a way which reinforced the old style, can be a major obstacle along the way to adopting the new. ‘Passive, inward looking and backward looking’ are hardly the adjectives to apply to modern financial management! One can only hope that the accountants in the public sector appreciate this, and are busy developing ‘proactive, outward looking and forward looking’ controls.
Even if you are in the private sector, you might like to compare the evolution of your business over recent years with those explained in the course, and see what still needs to be done.
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