Here are the steps:
Step 1: Understand Accountability and the Implications of Lack of Accountability
Accountability – refers to an obligation and/or willingness to accept responsibility for one’s actions. When it is not clear who should do what, i.e. roles are not clear, it is hard to keep accountability. When roles are well-defined and everyone knows what he/she’s obligations are, people can be held accountable. Without accountability, work does not get done properly, and learning is not possible. Accountability is very important in large enterprises, where there are multiple stakeholders, and some task have divided responsibilities.
Accountability oday is a big challenge, especially for large companies where many stakeholders can be held accountable – which is not necessarily the right way to delegate responsibilities. It is one of the many challenges of dealing with technology in the workplace nowadays, as accountability many times is reflected in results provided by the technological systems (CRM, ERP, etc.). Business Dictionary defines the term as a form of transparency and taking responsibility for activities as well as their results, including money or any property.
Step 2: Understand the Reasons for Lack of Accountability
Trouble with accountability in enterprise companies today does not necessarily come from ill-intentioned employees. it can sometimes just come from companies that find it difficult to decide out who is in charge of what business activity and who should be doing what task. There is no predefined mechanism of choosing people to be held accountable for specific decisions, and for later checking out the results of these decisions.
Many times, accountability is due to not having the right job titles for the right people. A job title implies a certain set of responsibilities, which leads to accountability on certain issues. By being careful in job title selection and definition, we need to decide which responsibilities are assigned to each job title, and make sure these accountabilities are tracked and it is known who is promoted or not because certain numbers have been achieved or not.
Today, many organizations still store data in spreadsheets or Word documents. This is a top concern for accountability and can cause problems, if data is not managed appropriately and consistently in these spreadsheets. Spreadsheets also give room for errors and allow to produce inexact versions of specific formulas and calculations that weren’t deleted or modified in the system. Document and data sharing can also be tricky because people have to scan through all the information to find what they are looking for or what was added from the previous version. While the method might work for smaller workplaces, it quickly becomes confusing in businesses with multiple departments and business units. Many man-hours are spent entering everything manually and money is wasted because no one knows where expenses are allocated and if they should actually be incurred. This article will provide some tips on how to better structure your spreadsheets for better accountability.
Step 3: Understand the Levels of Accountability and Which Ones Are Important for You
Accountability can be held at several levels, from the junior employee and up to the CEO. The CEO is held accountable for the overall company’s performance in front of the board of directors. A junior salesperson is accountable for obtaining his quota in front of his sales manager.
Accountability is directly related to the job title of the employee and to the name of the department in which he/she resides. It is important that every job title is attached to a certain responsibility/accountability – and attach that to specific numbers/metrics.
Business Unit Accountability
In the case of separate business units, accountability is foremost held by the executive in charge of the business unit (CFO, Head of Sales, Chief Marketing Officer, etc.). That executive, in turn, may delegate the accountability down into his direct and indirect chain of command. However, at the end of the day, accountability is chained. Therefore, for the executive in charge (CFO, CMO, etc.) the accountability is still his own in front of his managers. He/she knows that he/she is to be held accountable for the actions of his reports. He/shehe is accountable for all the numbers he/she provides.
Team Accountability
Under the business units, there are usually many separate teams that handle different issues and are therefore accountable for their own numbers. They are accountable for this in front of their direct manager.
Personal Accountability
It is not uncommon for specific employees to be assigned specific tasks such as sales, sales planning, supply chain planning and more, and they are then measured based on the accuracy of their forecasts, by crossing or not crossing their quotas, etc. Accountability can come in many different ways for different business units. Marketing can be held accountable for the number of leads they bring to sales (“Sales Qualified Leads”). Sales can be held accountable for the number of sales they close. Accountability is usually defined by first calculating or coming up to a certain number – sales quota, lead quota, target forecast error, etc. Then, the person in charge is measured after a period of time (e.g. one quarter, 2 quarters, etc.) and his quota is compared to his actual results. It is important that each title has well-defined “numbers” attached to it, which signify what this job title is accountable for.
Step 4: Assess the Monetary Costs of Lost Accountability
Because accountability is a “soft” metric, it is difficult to quantify the effect of lost accountability.
Lost accountability has the special property that it is set not to harm just its own business unit, but can create damage company-wide.
By losing accountability, many stakeholders are no longer held accountable for their business activities. This can cause the company to slowly underperform, lose deals, decrease deal activity, and over time lose its leadership position in the market.
Step 5: Implement Three Actionable Steps to Better Accountability
So yes, accountability is difficult to manage. But it’s not impossible. Start out by doing the following:
Step 1 to Restoring Accountability: Understand
First, try to understand the reasons for unclear accountability. Use the reasons above as a starting point for a discussion with your team and your managers. Identify the cultural patterns that characterize your organization and think about ways to overcome them.
Step 2 to Restoring Accountability: Assign
Second, ensure it is clear who is accountable for what and how results will be measured. Make sure you set these rules before starting any cross-functional assignment. Make sure to communicate the upside of success and the downside of failure. This will put everyone on the same footing, ensuring so no one needs to guess what will happen if certain quotas are not met. Be very specific regarding to which numbers each person is accountable for. Leave no room for errors. Each person should know where the numbers he is accountable for reside, and know how to modify them and new data arrives or market conditions change.
Step 3 to Restoring Accountability: Process Champions
Third, find and appoint process champions. Especially for activities that cut across different parts of the company, process champions will have end-to-end responsibility for achieving the desired metrics. These are difficult roles to play since they often come without full authority for all of the resources, but they are a step in the direction of single accountability for dispersed activities.
Step 6: Implement the New Processes Company-Wide
It is important to implement these steps in a consistent way across all business units, in a way that emphasizes accountability of the data, be it source data (sales, orders, etc) or data that is typed into the system such as forecasts. Each person should be held accountable for his/her numbers.
To ensure this is indeed the case, it is best to centralize financial data (including sales, purchases, pricing, etc.) into one large repository where everyone can quickly look into and also update his/her numbers for which he/she is accountable.
Benefits of Centralizing Financial Metrics such as Business Unit Costs, Revenue and Future Plans
- It increases visibility by creating an accurate inventory of technology assets and services; This is the first step to an efficient technology expense management strategy – and accountability – because you need to know what you have and who uses it in order to successfully manage business unit spending.
- It concentrates provider contracts in one place, which allows for renegotiations and better contract offers;
Basically, tracking assets and services in one place can change everything for companies who used to rely on spreadsheets or manual data entry. Visibility encourages accountability; when costs are visible to the business units they can’t be ignored. They can now be correctly assigned and optimized for considerable savings of time and money.
The Role of Software in Accountability: Organizations that choose a financial software solution regain control of their technology environment because the centralization of all assets in one system enforces accountability for all business units and creates a culture of cost transparency.
Essentially, accountability becomes a no-brainer when a financial software solution is implemented in an organization. Business units can track costs and other financial metrics and allocate them to the right people in a few simple steps directly in the software.
If you’re interested in improving accountability, you may find our other articles interesting as well, especially regarding the supply chain, sales plans, and handling multi-currency and multi-site issues.
Sources:
http://www.businessdictionary.com/definition/accountability.html
https://www.insperity.com/blog/improve-accountability-workplace-5-steps/
https://hbr.org/2012/11/why-accountability-is-so-muddled
https://www.gartner.com/doc/2656816/focus-areas-control-cellular-voice
