Lean Accounting is the application of lean thinking to all accounting and finance processes and systems and is an essential component of a successful lean transformation for any organization.
Three principles guide Lean Accounting and form the foundation for all of the accounting’s work and interaction with the organization:
- Customer value – delivering the relevant & reliable information in a timely manner to all users of the information inside the organization.
- Continuous improvement – improving accounting processes, cross-functional business processes, and the information used inside the business for analysis and decision making.
- Respect for people – adopting a learning attitude by seeking to understand the root causes of business problems and issues in a cross-functional, collaborative manner.
The benefits of Lean Accounting are:
- Creating capacity in accounting by eliminating waste in accounting processes.
- Accounting fully participating in cross-function continuous improvement.
- Flowing relevant and reliable information to all internal customers for effective decision making.
- Leveraging accounting’s analytical skills as lean financial coaches throughout the organization.
Lean Accounting provides service excellence to all of the accounting’s customers.
Do you use Lean accounting?
One of the challenges facing people who want to implement Lean Accounting at their companies is getting buy-in from senior executives. After all, the conventional budgeting process has defined how most for-profit organizations have operated for decades. In the minds of many business leaders, it works.
Enlightened companies using Lean Accounting have tapped many methods to refocus their accounting systems on creating customer value and collapsing them to reduce waste, such as using rolling forecasts and aligning operations by value stream