The Big-4 & Process Mining

Why process mining challenges traditional audits

Earlier this week, I got tagged in a LinkedIn Process Mining post regarding the Big-4 Audit firms being fearful of Process Mining and how this could impact their future business operations.  I commented on this post, but I think there is a lot more to dive into here and consider.

There are a few things that I want to unpack from this prior to sharing my thoughts:

• Audit, Quality & Compliance are areas that have been modernized over the years, but in general lags as no one wants to be the first to make revolutionary changes as this carries additional inherent risk.  AKA Limited rewards for being first vs. massive downslide for any failures.

• Typically audits are done based upon what is documented, not what has actually happened.  Hence why process mining uncovering how processes perform can lead to more audit findings and headaches. 

• Big-4 audit firms make most of their revenue from billable hours, automation or anything that threatens those hours is treated with skepticism.

• Most of the Big-4 audit firms also have separate consulting divisions who do technology and process work.  As such, there are situations where recommendations in a technology or process might decrease the need (and the associated spend) with an audit. Therefore, most clients will leverage different firms to ensure they are receiving unbiased advice.  

While there is much to be made of the “ignorance is bliss” observation, what really jumped out to me is how reactive most are when it comes to leveraging this technology and how there is an argument to be made to stay that way. 

When starting process improvement work, most businesses leverage their existing providers as process excellence is a service that has been added to numerous audit/consulting firms.  To an extent, this makes sense for any improvement or system to be successful, you need to understand what happens today and how it can be redesigned in the future. To their credit, large audit/consulting firms are great because they have:

• A proven track record of delivering successful projects across various domains and industries.

• A large pool of qualified and experienced consultants, who can provide a wide range of skills and expertise.

• Access to advanced tools and technologies, such as proprietary software, databases, and frameworks, that can enhance the process mining capabilities and outcomes.

• Global presence and network, which can facilitate the coordination and communication of the process mining project across different locations and regions.

• A strong reputation and credibility, which can increase the trust and confidence of the stakeholders and regulators.

I have worked with some great teams at these big firms and whole-heartedly recommend their services. However, in the same breath, I have worked with others who under-delivered or given me cause for concern.  Things you should keep in mind or have previously happened to me:

• They can be very expensive, as they charge high fees and rates for their services and resources.

• They follow standardized and predefined methodologies and approaches, which might not suit the specific needs and context of the organization.  This can be great when you need this type of support, but other times you need consultants who can plug into a pre-existing team.

• I’ve had Big-4 consultants who are redesigning enterprise systems tell me “They don’t need to know how the current process works.” Beyond concern around how they are documenting the system– this shows that they don’t understand the value of clear processes.

• I’ve had Big-4 consultants who didn’t know what process mining was... after their leadership presenting them as experts and having been trained.

• I’ve had Big-4 consultants who view process mining as a point-in-time tool, meaning they didn’t see long term potential for continuous improvement. If their clients are listening to their recommendations, I feel like they are doing a disservice as they are missing out on longer-term improvements.

There is no definitive answer or a single approach – each process mining project and company is different and ultimately which requires leaders to figure out the best fit for their organization, situation, and needs. Done right, they will vet and evaluate potential partners, and select the most suitable consulting partner, ensure projects are properly managed and that a long-term successful program view is taken into consideration for future business improvement.  

I also have had numerous conversations and am actively working on building niche products within process mining space which would help to further uncover processes and their audit compliance which is so terrifying to Big-4 firms. So their reason for worry is valid, just give it a few years. 

This is a somewhat controversial post, so I invite you to reach out and start a conversation with me if you are:

• Work at a Big-4 firm and disagree with me! What am I missing? How are you automating the audit and process discovery processes?

• Looking at automating or monitoring your processes for audit purposes? What can we learn from each other?

• Have a process improvement success or failure story which I should feature on The Process Mine.  This could be associated with Big-4 firms or completely independently.

• Interested in learning more about my first hand success stories in process mining.