Inside Finance: Atlas Air Advancing Data to Front Lines

When Wendy Shapiro arrived at Atlas Air a little more than a decade ago, the future staff vice president and assistant controller recalls how the company had many manual processes requiring a lot of paper, photocopying and filing. Middle-Market Executive recently caught up with Shapiro and asked her about what’s changed at the company and how Finance and Accounting are leveraging automation to better support and empower the company’s strategic moves.

MME: The findings of a recent MME survey show that finance appears to be breaking new ground when it comes to supplying information and data to decision-makers. Would the employees of Atlas Air tell us the same thing?

Shapiro: Yes, and I think you would be able to see the level in which financial information has been provided throughout all of our operations. One area that we have automated and provided significantly improved visibility is in our invoicing process. Back in 2007, we implemented an invoicing system which has allowed us to automate the approval workflow for all invoices and monitor the status and history of invoices across the company. Before, we had to scan and email paper invoices around the company and obtain manual signoffs, whereas now, we have a system where people can log in and view, code and approve invoices from their mobile device or computer, and once approved, the invoice automatically moves to the next step. We can monitor the progress of the invoice which allows them to provide more timely feedback to vendors.

MME: As Finance advances these types of improvements, have the members of the finance team begun to view themselves more as agents of change?

Shapiro: There’s no question about it. Our finance team definitely views themselves as change agents. We are continuously implementing automated solutions and streamlining processes that help our operations and ultimately the bottom line.

MME: Automating invoice approval appears to have been a big step in freeing up data, but what else is happening?

Shapiro: Well, with increased financial controls, we now have systems in place that allow people to update and review their SOX controls online. As the business evolves, we can make changes to controls and approve them. This also provides real-time access to the changes by management and auditors. But this is not just about the finance team. This is IT, human resources, sales and marketing, and other operational groups, as they all have SOX controls. It’s the world that we live in as a public company.

MME: So how is this a departure from the past?

Shapiro: Previously, the internal audit and external audit groups would have to go through a manual process and perform SOX walk-throughs with every group to update our SOX narratives. Now, business owners go in and update and certify their controls, and then any changes are automatically provided to internal and external audit.

MME: What are some of the types of tools that your finance team is using to achieve quicker analysis and planning, budgeting, forecasting?

Shapiro: We use an online budgeting software for our annual planning process and finance control and automation tools such as BlackLine’s Financial Close Suite, as well as industry-specific systems – all of which help us to achieve real-time visibility to our data and also allow us to forecast more quickly, with greater accuracy.

MME: Did you view the automation of the period-end close as a milestone? Why? And how have things changed?

Shapiro: Automating the period-end close with BlackLine has changed how we operate. One, we close on time every month without question. Two, we close faster within the month. The workflow enhancements that BlackLine provides for the journal entry and account reconciliation process have enhanced the supporting documentation and required approvals. BlackLine also has streamlined the process. It has helped us with quarterly reviews with our auditors, as well as with our annual audit, because the information they require is provided consistently each quarter. Our tasks that are set up in BlackLine allow us to ensure we did not miss an entry which translates into stronger SOX controls. Plus, the auditors can pull reports and documentation right from the system ensuring that they have all the information they were asking for as opposed to waiting for a member of the finance team to find and copy the documentation. This has allowed us to spend more time analyzing our data and doing better forecasting.

MME: In what ways have mobile technologies impacted this process?

Shapiro: Mobile technologies have allowed the financial information and processes to become portable. We can approve journal entries and sometimes reconciliations via our mobile devices from wherever we are. It’s the same with invoices and our contract systems. We can review and approve contracts remotely today. There are a whole host of in-house processes that we have system access to from our mobile devices which allow us to reference, review and approve remotely — items such as personnel action forms, helpdesk ticket approvals, IT systems approvals — so mobile IT certainly has helped.

MME: Turn back the clock and reveal to us how Finance spent its days before all of this automation came along …

Shapiro: Well, speaking specifically about the accounting team before we automated, I would say that many of the accountants spent time doing administrative work — photocopying, passing things on to external auditors, looking for invoices, searching for journal entries, making certain that we had proper approval on everything.

MME: Where is Finance spending its time today?

Shapiro: Finance is spending its time partnering with the business. It’s helping sales identify more value-add service opportunities that Atlas Air can offer our customers. It’s doing better forecasting, using trends in the industry to anticipate what’s going to happen in the future — which is forecasting from a business standpoint. This continuous improvement process has allowed us to consider how we are doing things rather than just doing them. We have been able to find ways to streamline and reduce redundant and non value-added costs out of the organization. We have found that continuous improvement is not only expected in our business but it has driven significant benefits.

MME: How have the company’s business leaders reacted to finance people playing different roles?

Shapiro: Finance has evolved. I think that our focus on continuous improvement and control requirements have made Finance more involved throughout the organization and what Atlas has done through automation has made Finance’s involvement seamless. We have made Finance and Financial Controls part of the business culture. Whether Finance touches the front end, where pricing and contract commitments need to be determined, or on the back end, where proper review and accountability impact our bottom line, Finance is now part of the culture of the company and this has worked really well. I think you can judge business leaders’ reactions by the fact that Finance is involved from the beginning to the end.

MME: Still, change isn’t always welcome. How does your finance team address pushback?

Shapiro: I think that one of the things that we do well is that when we do have a project or a new system, we try to involve all parts of the business that the system would touch and have people from those touch points involved in the process from the beginning. We have learned that buy in to the process is critical and if you can show people how the automation or the process can improve their current role and get them excited, the project has a greater success rate. If you’re a global company, you have to think about your global user base and how to get them involved and how to make the acceptance of the system successful. Companies fail when they try to do it in a vacuum and the owner of the system tries to implement something without considering the stakeholders within the organization.

MME: Can you explain to us how organizationally Finance is today embedded within the business?

Shapiro: While the entire finance function rolls up under the CFO, many in the finance team directly support the company’s operational groups. Specifically, while divisional controller teams report into the corporate controller, they are working side-by-side with the various operational groups. The divisional controllers have a dotted line into the operational VPs. They are active in preparing plans, forecasts and performing analyses for the group (with the assistance of the corporate FP&A group), and they’ll ensure invoices are coded accurately and with enough information to assist with analyses.

MME: What’s the next phase for this type of automation? Where are things headed?

Shapiro: Forecasting is a big item for us. We’re looking into not only our short-range forecast, but also our long-range plan. By having accurate data available right away, we’re able to do this better and lengthen our forecasting range. I think that people at this company are extremely comfortable with technology now, and because of this, everybody is constantly looking to automate more. We have a lot of projects going on currently where we’re trying to find additional processes we can streamline and automate more manual tasks so that we have even more time to focus on special projects, forecasting and closing even faster than we are today.

MME: From your personal viewpoint, can you give us some sense of all that’s been achieved over time?

Shapiro: I’ve been with the company over 11 years. The only accounting system the company had was an ERP system with little workflow automation built in. Reconciliations and journal entries were on paper with manual approvals. We had to take a mostly manual process with manual controls and make it best-in-class. As the company has grown and the business has become more complex — we added more aircraft types to our fleet, became a passenger airline, and added a Dry Leasing business — over the past couple of years we have only added a few employees into our finance organization, and our external audit fees (mostly because of BlackLine and other systems) have decreased.