FEI Forward and FEI Daily conducted a survey of its readers in December to gauge where they are placing resources bets in 2019 and how they will manage staff and their own careers.
Whatever priorities that may be in the mix, a majority of the FEI Daily readers that responded to the survey (85% were Financial Executives International members) believe there is a fair chance of recession in the New Year.
Below are detailed results of the survey results along with insights from FEI members regarding what the numbers mean and how they should shape your own 2019 plans.
FEI Daily: Our survey shows that financial executive’s top priority for 2019 is “implementing new technologies (AI, blockchain, RPA). Why do you think this is a priority for the New Year? Is it a continuation of a longer trend?
Joe Prati, member and chair of FEI’s Committee on Finance & IT: To some degree it is a continuation of a longer trend but it is probably becoming more urgent as the strong economy starts to show signs of age. Revenue and margin growth for many companies will become more challenging. As a result, companies are increasingly looking for ways to be more efficient and technology promises to do just that.
Finance departments in general have been slower to adopt new technology unlike most other functions. With the advent of SaaS (software as a service) where they do not need to rely on IT to the same degree and the vast improvement of security in protecting data, senior finance executives are excited about the levels of automation that they can achieve through new technologies like AI, RPA, etc.
Finally, there are enormous pressures within finance organizations to attract talent and millennials are looking to work in organizations that incorporate automation consistent with the type of automation that they are familiar with outside of work. Finance needs to embrace these new technologies to survive. Any technology that improves effectiveness and efficiency across the office of the CFO will be attractive to finance organizations.
FEI Daily: Are there any specific technologies that you feel will be the focus in 2019 and why?
Prati: It likely depends on the industry but automation in all forms that can perform lower-value, transactional activities faster and cheaper than humans would be one. RPA will be a prime opportunity for acceleration as organizations get more comfortable with the use of this capability and expand from pilots to more mainstream activities. Another is likely the convergence of big data and AI to gain better and more timely insight into the massive stores of data that companies accumulate these days. In addition, the journey to the cloud of IT information and processes, to take advantage of scale and flexibility, will continue.
FEI Daily: A majority of respondents plan on either keeping their staff levels static or growing them. However, the second highest overall priority is cost reduction. How can senior level financial executives achieve both at the same time?
Paul McDonald, FEI member and senior executive director at Robert Half: We’re seeing companies implement new technologies to automate processes, build efficiencies and, ultimately, reduce costs. This desire drives hiring needs for many firms.
Technology augments employees’ work. Firms want technology to handle routine tasks and free up time for their employees to focus on more strategic issues. Businesses also need to hire accounting and finance professionals proficient with advanced tools to help the organization realize the potential of new technologies.
We saw this in the research for our benchmarking report. While the majority of companies expect to maintain current staff levels to accommodate digital transformation efforts, the percentage of organizations looking to add staff was more than five times as high as the percentage looking to reduce personnel levels.
Businesses frequently need more resources. Many organizations are running lean and barely have the staff needed to handle must-do day-to-day responsibilities. These functions simply can’t take on more routine work, much less tackle high-priority or one-time initiatives such as a system upgrade, without help.
One of the ways companies manage expenses while tapping the support they need is flexible staffing. Firms work with interim staff to tackle rising workloads, provide specialized expertise and assist with key projects. We’re also seeing demand for a managed business services solution, where companies work with a firm that delivers and oversees a team of professionals to help with major or unexpected initiatives.
A word of caution on reducing costs: Companies that focus too much on cost savings in the human capital arena set themselves up to struggle. If your employees see you going too lean or skimping on resources, they may look for a new opportunity. And in the current environment of high demand, low unemployment and a shortage of skilled candidates, make no mistake, they’ll likely find one. Exacerbating this problem, word will get around, making it more difficult to attract top performers in the future.
FEI Daily: A vast majority of respondents plan to stay put in their current position. Is this consistent in what you are seeing from senior-level financial executives?
McDonald: The percentage of financial leaders looking to make a move represents a significant finding. More than one in five want a new position, and that doesn’t take into account passive job seekers who would jump for the right opportunity.
Companies need to monitor these trends and ramp up their retention efforts. Experienced financial professionals have options. If their current company doesn’t meet their needs, they’ll find one that will.