agile audit
合规财务税务和会计18 二月, 2021

Being agile in internal audit: 5 top tips to get started

By: Mark Williams

Being agile is to be adaptive, responsive, and nimble. It’s often said that being agile is the difference between being a huge super-tanker and a small speedboat when it comes to changing direction or course correction.

Agile-minded auditors and audit leaders acknowledge that they cannot predict the future. Therefore, as auditors, we must work in a way where we can comfortably change direction to cope with unknowns, unpredictability, and uncertainty.

The principle at the heart of this is “test and learn.” Rather than spending lots of time and effort trying to predict the future and getting it wrong, agile-minded auditors work in smaller bite-sized chunks. This enables the audit team to test, learn, and course-correct as necessary to allow them to comfortably handle events in an unpredictable world.

Agility in Internal Audit has firmly taken hold in the last three years, with many internal audit departments experimenting with a more agile approach for:

  1. Audit planning (continuous, not an annual process)
  2. Team design (stable and focused teams, not resource Tetris (the game!)
  3. Audit execution (regular incremental audit delivery, not at stages or audit end)

Sound interesting? If so, how best to start?

Based on my experience helping numerous internal audit departments work in a more agile way, here are my tips for how best to get started.

Tip #1: Think Big, Start Small, Learn Fast

Think big, start small, and learn fast — this is an Agile mantra you might be familiar with. Think Big is the first step, and it means that you should start with the “why.” What is your compelling reason for wanting to be more agile? You should be aspirational with your vision. If others in your organization can understand what you are trying to accomplish by working in a more agile way, they are more likely to buy into and support it. By communicating a compelling vision and the associated high-level metrics for success, everyone will fully understand the reasons for change or the “why.” Being agile is a means to an end, so be clear on what you anticipate optimizing as a result of working in a more agile way. (A good starting point is: better, faster, happier).

While there’s no harm in thinking big, it is best to start small when actually implementing more agile ways of working. For the best chances of success, you’ll need to start with an audit pilot. One stable and focused team and one audit, and then ring-fence to keep them that way for the pilot’s duration. An agile-minded audit team breaks down the audit work into weekly or bi-weekly cycles (Sprints). At the end of each cycle, the team reviews and shares with stakeholders what has been done, what has been learned, and what should be tackled next. They might even incrementally write and share the audit report as they go. It’s these rapid feedback loops that enable us to learn and share as we go, rather than at the end of the audit. This dramatically reduces surprises at the end and, therefore, the overall time taken, especially in reporting.

From there, you’ll quickly learn what will and won’t work for you. Context is key in this situation. No one size fits all. Do more of what works for you and less of what does not. For many internal auditors, increased agility is a multi-year journey rather than a rapid change.

Tip #2: Vertical Not Horizontal

When you think about your pilot audit (remember…start small), go vertically through the organization rather than horizontally. Take a sliver vertically through the organization and start with your Chief Internal Auditor. Depending on your organization’s size, also include audit directors, senior audit managers, and lead auditors, all the way down to the team level. Support and coaching from the top are critical to success. This ensures that you don’t end up with agility only at the team or audit delivery level. Instead, ensure the agile audit pilot includes senior leadership and runs vertically through your organization.

Tip #3: Stable-focused, Longer-lived Teams

Small teams are the building blocks of an agile way of working. The principle of stable-focused, longer-lived teams is absolutely key to working in a more agile way. In the past, internal audit departments tend to split auditors across multiple audits, which results in frequent context switching. Context switching is a wasteful and inefficient audit practice that can damage an internal auditor’s focus. With most internal auditors, give them the luxury of focus, and they’ll get things done faster and far more efficiently. After all, auditors are knowledge workers who perform complex cerebral work. Focus helps them deliver greater value and relevance.

It’s also important to keep the team intact. Don't switch people in and out of the audit. Instead, gather the right team members, determine which of them work best together, and balance the skill sets to build a longer-living, stable team. This approach not only delivers a dramatic improvement in efficiency, but internal auditors also find themselves more invested and engaged. 

Tip #4: Invite - Don’t Impose

Invite — don't impose — is a key principle from the perspective of behavioral change. You want genuine volunteers, not those who are “voluntold.” That’s an important difference. Genuine volunteers who wish to work in a more agile way will embrace it and are intrinsically motivated to give it a try, rather than those who are forced to participate and resist it. If you are in a leadership position, support and encourage those volunteering for the agile audit pilot. In doing so, you will make it safe for them to experiment.

Also, take a volunteer from your professional practices or QA function with you. Their help and support will encourage auditors to try new things. They’ll also potentially learn how to improve the audit methodology to enable greater agility.

Tip #5: Agile Training (in the context of IA, not IT)

As a trainer and coach specializing in agility in Internal Audit, it’s no surprise that I would encourage you to train one or more auditors within the department to coach and assist their team, or others, in adopting more agile ways of working. Having people gain a deep understanding of the agile mindset and tools will significantly enhance your ability to successfully adapt to working in a more agile way across the whole audit life cycle and enable you to avoid a few of the common pitfalls. Again, ask for volunteers to do the training and scale their agile knowledge across the department (of course, with more volunteers!).

Conclusion

Even before the pandemic, it was the perfect storm for Internal Audit. Auditors have been under increasing pressure to do more with what they have, and in parallel, deliver work of greater value and relevance. The agile mindset and tools that many internal audit departments adopt have become increasingly important to their survival. And in today’s fast-paced environment, where internal auditors need to move at the speed of risk, working in a more agile way will help you do just that. 

It’s straightforward to get started. Use an agile approach to adopt working in a more agile way. Evolution not revolution. Think big, start small, and learn fast.

Mark Williams
Mark Williams
Business Agility Coach and Trainer

Respected and industry-recognized coach and trainer for 8 years. Over the last 3 years, he solely coached IA and Assurance functions. Founder of Agile Outside IT, business agility specialists. Agile auditor and leading for agility in IA classes.

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