TxM 042 Section 4.7 Risks and common mistakes when developing Group-Wide Charts of Accounts Created by James on 7/3/2013 5:25:52 PM
Following on from the previous section dealing with risks and common mistakes with regard to Precision Taxonomies generally, this section looks at Financial Taxonomies and Group-Wide Charts of Accounts based on the Cubic Business Model specifically.
The following risks and common mistakes frequently are made:
1. All SEPT issues
All the issues relating to Strategic Engineered Precision Taxonomies apply to Charts of Accounts as well.
2. Failure to recognize hard reality and real complexity
Failure to understand that the Cubic Business Model is a reflection of hard, real world, logical reality and business complexity resulting in lack of precision in the model.
3. Resistance to change by finance staff
Finance staff and accountants are trained to resist change – we do NOT hire creative accountants – they therefore find the substantial change in working practices and ways of thinking difficult to accept and may well resist.
"There is something wrong with this" – is a response quite frequently encountered.
Robust executive adoption of the concepts and the design and involvement in the implementation is therefore vital.
4. No software to maintain the integrity of the model
It is extremely difficult to maintain the integrity of the Chart of Accounts and the model without software to assist.
5. Seeing the project as an Accounting project not an Information Engineering project
Treating the project as an Accounting project and looking to accountants for all the answers instead of seeing the project as a strategic information engineering project and looking to information engineers for the solution. The Do-It-Yourself phenomenon coupled to "that is too much money" are extensions of this issue.
6. Failure to go to the finest level of detail
It is seductive to say "we will add the detail later" but it is advisable to go right down to the detail in the project.
7. Failure to recognize that the Cubic Model is also a Governance Model
The Cubic Model is also a logical Governance Model, if this is not recognized and taken into account in implementation problems can result.
8. Failure to implement effectively
There are many change implications that can get in the way of a successful implementation. It is vital to treat the project as a full blown technology implementation project and manage accordingly.
Any of the above, if not properly dealt with, will cause problems.
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