Technology Is Changing Everything In The Finance Suite

The Financial Executives Research Foundation (FERF)'s Olivia Berkman spoke with Paul McDonald, senior executive director at Robert Half, about the critical business focuses that emerged this year, according to the recent Benchmarking Accounting and Finance Functions: 2018 report.



Digital transformation emerged prominently in 2017 as a critical business focus, according to the Benchmarking Accounting and Finance Functions: 2018 report from the Financial Executives Research Foundation (FERF) and global staffing firm Robert Half.

Olivia Berkman: Hi Paul, thanks for joining me today.

Paul McDonald: Hey, thanks for having me.

Berkman: I want to start out by just talking a little bit about technology and the effect that it's having. This year technology seems to have played a larger role in how the finance function operates and in the staff itself. Why do you think that is, and what specific technologies would you say are driving that change?

McDonald: Yes, when we did the benchmarking survey this year, for the ninth time, the 2018 results came back with technology really playing an important role in the finance and accounting leaders' responses. It's not surprising, we've been watching this trend over the past few years. There are a number of factors that are leading to this, Olivia. 

Number one, there's a large movement to the cloud. A lot of companies are moving their functions to the cloud.

The second thing that we're seeing is a lot of automation of the actual functions internally, and with that requires a lot of technology for the automation. 

Last, but maybe the most important, is the digital transformation that's going on in North American companies, and this is a worldwide phenomenon, but our report focuses on our Canadian and U.S. results from these financial leaders. 

Transformation is about using technology in all aspects. For instance, there's been a huge accumulation of data that's been happening over the past number of years, a lot of people still call it Big Data. This mound of data that's being collected from customers, from the supply chain if you're a service company, all that data needs to be analyzed. So how machines are doing the analysis and how humans are involved with analyzing that data is really playing a huge part in what the organizations are focused on right now.

When you look at technology just from those three areas, automation, digital transformation, and cloud computing, you've got just a perfect storm happening, which is leading finance leaders down that technology track with many of their responses.

Berkman: Right, and what specific areas of finance do you see leaders increasing staff?

McDonald: That’s a really good question because the report does show that U.S. and Canadian companies are planning on either staying the same or increasing staff, and again, it comes back to the technology. Data analytic professionals, and again, when I say professionals, those are skill sets where you might have a senior accountant that has a strong technology background. For instance, if it's a reporting area that's going to the Cloud, they want really well rooted individuals in technology, either that specific cloud aspect, maybe it's Salesforce, maybe it's something they're using to reconcile accounts or financial planning analysis, for instance, like in Anaplan, or BlackLine cloud computing. They want that experience to go along with whatever else that professional's being required to do. 

Compliance is another area, and we're seeing that generally all the finance and accounting areas are adding staff for the most part. 

We're in an economy in North America that's still on a really strong growth curve, so they're looking for individuals in all functional areas. Some of the areas that we're seeing outsourced, which might impact the need for staff, would be tax and payroll, two of the highest areas that the report respondents are showing as being outsourced, which could impact staff levels.

Berkman: You mentioned automation as a real change driver. What are some of those other areas that are ripe for consolidation? Downsizing their teams perhaps?

McDonald: The automation is truly looking at making it more efficient within the areas. It could be financial planning, it could be forecasting, budgeting for instance, you would think that that's impacting staff on a decrease side, but what we're seeing is that in this migration they're predicting that they're going to be needing more staff in that area. So, it was a key finding in the report.

Berkman: That makes a lot of sense. It's making things more efficient, but not necessarily impacting staff decisions negatively.  In other words you don't need a smaller number of people. It's not eliminating team members.

McDonald: It would really point to that when you think about that at the high level, but when you really dig into the responses, the companies are analyzing the data and they're trying to automate processes, but then they're asking questions on what does the analysis point to? What is all this data telling us about our customers? We need people to interpret the data, and it points to the increase of soft skills, mainly communication and presentation skills necessary in the staff in order to present the data to the teams, to the CFO, to the mid-level management, and make decisions based upon that data. 

So, when you dig into the details it's kind of interesting, because it's counter to what logic would tell you. You would think decrease in staff, but the technology and the data analytics is leading to the increase.

Berkman: How would you describe the ability of senior financial leaders to monitor their team's performance?

McDonald: It's a great question. In the U.S. we have 3.9 percent unemployment as of last month. In Canada, we're showing signs of great need for talent as well. The statistics are showing that it's hard to find people, that job openings are at a very high level right now. So, retention of staff, monitoring of staff, acquisition of staff is at the forefront of all the executives and leaders minds. They're spending more time with their staff today to try and find out are they engaged, are they challenged? What does the career map look like in terms of moving ahead within the organization? They're investing in training in order to help those people on their journey forward. We're finding that more people in the leadership capacity are spending more time monitoring through those areas and doing a gap analysis on where the knowledge level is, investing in their gaps and allowing them to grow within their organizations.

Berkman: Have U.S. and Canadian finance teams encountered the same staffing challenges, or are you seeing differences there?

McDonald: We're seeing that Canadian and U.S. finance and accounting teams are encountering the same challenges right now. Technology is at the forefront of everybody's mind. As I mentioned earlier, it's table stakes for any staff coming onboard today, from an entry level person, right on through to a senior director level. User knowledge in some people, an overall knowledge, and beyond just a cursory knowledge is necessary. Understanding how it fits together. 

That technology is at the forefront and creating challenges on both sides of the border. Additionally, compliance on both sides of the border is leading to challenges in finding people. Then it comes to just the overall need for staff to fill in for this business growth that we're undertaking right now. It's really exciting to see, but it's at the forefront of all the Canadian and the U.S. corporations that we surveyed.

Berkman: Beyond what was explored in the survey, what do you see driving finance teams' staffing decisions?

McDonald: Well, the staffing decisions being driven today - do I outsource, do I bring people in and insource contractors, interim professionals to help me with this growth, with the digital transformation that we're undertaking? The automatization, the cloud computing that we're putting in place, these are driving the same decisions on both sides of the border. Should I hire permanently? Can I find these people permanently to bring onboard? What is the most cost effective way to do this? 

For instance, we see the increased use of interim professionals. That is driven by, one, the fact that they can't find the people on a direct hire basis, or two, they are finding individuals that have great subject matter expertise and bringing them onboard for a period of time, say six or nine months. There's a knowledge transfer to the existing staff that takes place, and then that knowledge transfer allows the interim to complete the assignment. The existing staff that learned from the subject matter expert carries on with that knowledge. 

There's a lot of make versus buy decisions that are going on in staffing, and if you're lucky enough to find the person, or the people, that help you move on all these initiatives that we've been chatting about Olivia, if you're lucky enough to find that person, it's very important to hang on to them. That goes back to investing in your human resources, making sure that you're keeping them current, keeping them engaged, keeping morale high, and building a solid culture around your teams. A lot of senior executives right now are focused on culture building within their organization in order to keep engagement high, keep morale high.

Berkman: Absolutely. Well, Paul, thank you so much for your time today.

McDonald: It's been my pleasure, and it's great to partner with FERF for the ninth year in a row and issue this report. We really are thankful for that partnership, and thank you for your time.

Berkman: Us too. Thanks so much. 

Financial Executives International members can download the full report by clicking on the image below.