As it revolutionizes the business environment, technology is rapidly changing how business is conducted in the digital age. Digitization is eliminating functional silos, and value chains are becoming transparent and integrated ecosystems, affecting suppliers, transporters and customers alike. Companies, in addition to becoming increasingly data-centric, are also encountering a workplace revolution, sometimes referred to as Industry 4.0, and realizing that they need to adapt to this fundamental change in order to survive and prosper. Yet, it is a change that they are still grappling to understand. Given the nature of the disruption that these technologies are imposing and the dire need to understand its deeper impact on P&Ls, businesses are increasingly turning to their CFOs, to help navigate the organization through what is a sweeping and often choppy business terrain. The onus is therefore on the CFO and the finance team to be up to the task, whether or not they are ready to embrace this change.
The need for organizations to have the right people with the necessary skills in place has never been more vital. Organizations must also ensure that their staff across all business functions, especially finance and accounting (F&A), fully grasp the ramifications of technology and the skills to correlate these to their functions.
Traditionally most CFO offices have had their focus largely centred around governance – ensuring that their teams have a strict oversight on compliance while making sure that numbers were being accurately reported, and all procedural norms being adhered to and controlled effectively. In addition, there was a strong focus on cutting costs.
However, in today’s data-centric organizations F&A focus is shifting towards understanding a rapidly evolving business landscape and helping to reengineer the business model accordingly, while also trying to outdo the competition. F&A departments are now increasingly realizing that leveraging technology enables them to become strategic business advisors, capable of helping to improve competencies, reduce wastage and deliver on the overall needs of the business.
A recent global business survey by the Institute of Management Accountants reveals that F&A departments of most organizations are being significantly impacted by changing technology, thereby fundamentally changing roles and responsibilities. These companies are now grasping the need to involve F&A staff in the introduction of new technologies but are also aware that most such employees are only “somewhat prepared” for such change. In fact, just around 13% of organizations felt that their finance staff was well prepared for technological change. To address this, professional certification, through individual or group courses, is required to develop specific skills that can help organizations to effectively manage change while harnessing the opportunities at hand. This practice is considered, by many organizations and industry specialists, as one of the most effective ways to prepare F&A employees for the changing business environment.
According to a recent Accenture survey, 34% of finance tasks at large global companies are already being done by algorithms and robots, and that figure is expected to rise to 45% in 2021. The profound impact these technologies are having on the finance profession prompts many to question what skill sets they need to remain effective, even employed. IMA’s research shows that finance organizations that are substantially above average in effectiveness spend less time on statutory and external financial reporting and more time on strategy development and finance operations improvement.
Professional certifications offer enables accounting professionals to be brought up to speed on the skills needed for a high-performing finance function. It is a cost-effective means to bridge knowledge gaps that cannot be left to corporate HR departments. It is down to department heads or individuals themselves to set a training agenda and identify the key competencies and skillsets they need to not only meet their performance expectations and career goals but exceed them.
In today’s global business environment, organizations that value and support certification actually perform better and enjoy much higher employee retention rates. Reducing staff turnover can help lower recruitment and training costs, as well as provide an increase in efficiency that comes with more experienced employees.
The reality for many finance functions has been that the potential for being able to provide strategic insights to senior management has been hampered by the need to focus on lower-value-added activities, including transaction processing. Certification can help evolve the role of the finance function from record keeper and “compliance cop” to that of a strategic business partner.