The following article is part of our blog series "The Future of Audit"
What is the reason for an in-depth confrontation with this topic you might ask?
We at zapliance are a team of auditors, scientists and developers and we have noticed over the past few years, that the general conditions of auditing are changing in an incredibly fast pace.
As a result, the steadily increasing amount of available data means that a holistic and valid view of the risk/opportunity perspective is becoming increasingly difficult without the support of partners within the organization.
In other words, this forces the auditor to reevaluate his own strengths and weaknesses, as the cooperation with partners requires personal competencies, that auditors until now did not have to rely on (You can find our main article, that discusses the aforementioned points in more detail here).
Our blog series about individual competencies supports auditors to reconsider and reflect their normal practices, to become even more successful in the future.
Have a go and try it out!
My name is Alexander Rühle and I have been a passionate auditor since 2006 and have been the CEO at zapliance for 5 years by now.
In the following article I would like to discuss the topic of openness towards new things and ideas – a topic, which is not only important for the audit (more about this later), but it’s also a very important topic for me as a CEO of a company.
Why you might ask?
Because new ideas and the way we deal with them is a major challenge for our team here at zapliance. At the same time, new ideas and innovations are part of our day-to-day now.
This applies to both our internal and external processes: On the one hand, we continuously develop and improve our own products and we have to reassess and rethink old concepts to follow new ideas.
On the other hand, externally, we’d like to be perceived as an innovation driver, constantly looking for new ways to improve our products, to enable auditors and professional experts and make it even easier to work with data.
You can probably imagine, especially the second point is particularly marked by contrasts. While on the one hand, every auditor knows or suspects that it is only through innovation that it is possible to continue to add value to the organization for which he works.
On the other hand, innovations require a lot of work - not only a change of thinking, but often also a series of organizational changes. And this hurdle leads more often than one might think to the rejection of something new.
The perfect example, the following experience, which I had a few years ago while working as an auditor for a large medium-sized company in a conservative industry: On this project, I repeatedly stumbled across anomalies in their data analyses.
Imported CSV files were simply flawed, which led to incomplete and incorrect results: a classic.
Since I had gotten to know the free software KNIME myself on another project, which already has ready-made "nodes" for many data sources and can analyze and, above all, automate even highly complex data sets in many different ways, I suggested it to the customer.
But despite several solid arguments - among other things, the software is even available free of charge - the customer’s manager decided against it.
The currently used data analysis software is an absolute standard in the auditing world (although it is mostly unused in the drawer).
An additional concern was that the new software requires training for the employees - time which they "can now really spend on more important things".
It was a frustrating experience all round, as I knew that trying KNIME would not only have advanced the specific topic in terms of content but would also have brought joy and new motivation to at least two of the auditors.
However, a few months later, the tables turned. Not in a meeting as you would assume, but I was at the front door of my little son’s kindergarten.
That is where I met the father of another kindergarten child who coincidently happened to work at the company in question, but for the compliance department.
And as it happens:
We got to talk, in complete confidentiality, of course…
A few weeks later, during a short conversation at the kindergarten entrance, the other father told me about a challenge, which I knew, could be solved by “KNIME nodes”.
A perfect situation for me to use this moment and bring back KNIME into the game again. Not surprisingly, my suggestion opened new doors with the other father.
Simultaneously, the other father expressed his incomprehension why such software has not been used before and decided that he would bring the proposal to his superiors.
The end of the story: KNIME was trialed and later also implemented. This did not only please the employees, but also their manager, who from that moment onwards never got tired of praising the advantages of this software in numerous meetings.
We auditors should also be flexible in our thinking.
I believe that stories like this happen to us auditors over and over again.
We can’t convince others of what is new.
But let’s think the other way around:
Do we auditors actually manage ourselves to always be open to new ideas and most importantly, remain open to new ideas?
This is where I am also skeptical, not least because of my many years working experience with numerous of different auditors – and I don’t exclude myself.
After all, it basically makes absolutely no difference whether you are on the auditor’s side or on the customer’s side:
every person is differently when it comes to being open for new things.
This is an individual personality competence which I already wrote about in one of my articles “What competences will the auditor need in the future”.
At the same time, however, it is so obvious that the willingness to accept or implement innovations is becoming increasingly important in today’s world and, above all, in the prevailing competitive environment.
Not least because of the closer cooperation with partners (see our main article) auditors are particularly affected by this.
Which is why, this article is dedicated to openness to new ideas – how to adopt and maintain this openness mindset.
Let me say one thing in advance:
Change is never easy unless you are a chameleon.
Humans are creatures of habit and try to avoid work that implicates change.
It is easier to just keep everything as it is.
But as it is often the case with the comfortable things – wait too long and at some point, it haunts you that necessary changes weren’t implemented in time.
There are numerous examples of this:
Now in the Corona crisis for example, in Germany we are missing the digitalization necessary in schools.
Students loose time and fall behind with learning materials because of the improvised measures that were undertaken by schools.
Another example is e-mobility.
Because the necessity for development and changes was ignored, the German car industry is threatened by falling behind.
The truth can hurt. But ignoring it hurts even more.
What both examples have in common: Behind the lagging reforms are people like you and me.
But how do we now manage to stay open to change?
The first step is to take a harsh look at the facts.
And that is not so easy.
Because we humans tend to see things as “not that bad”.
This is reassuring, but also a misconception. Only when we have a realistic picture of the situation, we recognize the importance of change.
The same seems to have happened to my customer’s manager from my example at the beginning.
He himself saw no need to change anything, but apparently never talked to or listened to his employees.
But not considering the opinion of others is also a widespread convenience tactic.
Further in this article I will also discuss what it takes to manage and deal with different opinions properly.
So once you took the first step towards an open mindset and you have the willingness to identify potential problematic areas, the second step follows:
Expose yourself to new views – for example, by talking to others and listening to their views.
So, make sure to keep meeting people who are very different from you. They may have a different cultural background, work in a completely different field, or be significantly older or younger than you.
This could even be having a quick chat with the owner of the corner shop.
The idea is not about adopting these views yourself, but rather about seeing things from a different perspective, understanding that particular perspective and accepting it as a possible additional view.
This does not only broaden your horizon, but also helps you to become freer in your thinking – a quality that is essential to an open mindset.
This principle is already lived by in many companies today under the term “diversity”, as it is assumed that a team of people with different backgrounds finds better solutions.
To achieve change you will need to follow the same principles as for the moon landing: Small steps – Great importance.
The next step towards open-mindedness is no longer just about leaning from other people – but about trying new things for yourself.
The motto is “Don’t knock it until you tried it” and this starts in your private life.
Don’t always buy the same products at the supermarket, why not try something new?
Don’t always go to the same old Italian restaurant, how about Persian tonight?
Reduce any fear of trying new things and slowly but surely make the new things a habit.
And then take this mindset with you to work.
Try small changes too – it doesn’t always have to be big revolutionary changes: read a different online journal than usual.
If you have a question, why not call your customer and ask them about their view?
As the Head of Auditing stay hungry and challenge yourself.
Have you ever tried VLOOKUP in Excel? Pivot tables in Excel are so versatile, they are pretty much the swiss army knife for analyses.
Try it yourself and if you have question, instead of asking your colleagues first, check out what’s on Google and YouTube and overcome your challenges.
What helps me is my drive for ambition, same as in my workouts I need to overcome my challenges somehow (After all, there are too many colleagues in my team that outsmart me…).
However, just keep in mind and don’t forget that there is a trial period, it’s all about trying, failing and learning.
Schedule time for those trial periods – for example, take the entire week to read that online journal you always wanted to read.
And then after the week also take time to reflect on what you’ve learned, are there parts where you agree or disagree?
Was it worth it to switch to that online journal?
If it’s not for you, maybe what you need is a partial change, where you try different things over time – for example, reading different journals on a weekly basis and switching them.
Even if these small changes may seem like an annoying extra effort at first, they not only help you to get used to new things, but have another advantage:
You expand your skills and knowledge, even if you probably cannot use them immediately.
But speaking from my own experience, I can say:
Because the time will come when you can make use of your newly acquired skills.
When you are faced with a problem and then suddenly remember that one sentence from your journal that you read or that specific product that you read about, and you will find a new approach to the solution.
By the way, my advice to stay patient also applies when developing an open mindset.
Once you have started to be more open to new things on a small scale, you’ll soon realize that it actually isn’t that difficult at all.
You’ll notice small improvements and then you’ll be able to celebrate the success coming from small changes.
This will give you the confidence in assessing opportunities and risks and will help you to apply an open mindset even when the amount of decisions you have to make is constantly growing.
Beware of blind actionism.
The important thing is not to get overly confident too quickly.
Because too many changes at once can also have a destabilizing effect.
In the professional context, this means that not only colleagues, but also customers can easily become insecure if suddenly nothing is the same anymore and the well-established processes have changed.
So, don’t only pay attention to your own limits, but also to those of others.
Develop a mix of tried and tested and the new. And don’t forget the trial phase, even if major changes are made, give it time!
I would recommend that you “guide” your network – superiors, colleagues, customers, etc. through the change.
Announce changes and pay attention to the reactions you will receive.
Because if your superiors or your colleagues cry out at every change, your main task will be to introduce your environment to change in small steps – just as you have done for yourself.
In conclusion, an open mindset is more necessary than ever for us auditors today.
This is especially true regarding our customers: Because the later we start the change, the more difficult it usually is to implement them.
Opportunities come, but as you say, they also go again.
Don’t miss these opportunities and constantly develop your open mindset further.
You will see: You will be rewarded.
About the author:
Alexander Rühle, CAI, CISA, is the CEO and CO-founder at zapliance. After 15 years in the finance and auditing world and having met his partner in crime, Prof. Dr. Nick Gehrke, at PWC, they started zapliance together, with the mission to change the way business professionals of the future work with data.