Even finance is being affected by the onslaught of human vs. machine with a recent Deloitte survey revealing some startling stats.
The finance function is experiencing rapid change, and a recent Deloitte survey found that 73% percent of respondents are planning to implement technology to replace humans in their workforce this year—up from 58% a year ago.
While the finance workforce will grow smaller, companies need to adjust existing staff and bring in new skills that typically aren’t found in the finance department, according to a new Deloitte report.
“From a digital perspective, when we look at the role of CFO, it’s becoming more about their ability to be a catalyst and strategist in their organization,” said Rob Dicks, human capital CFO services leader and principal, at Deloitte Consulting.
Whereas CFOs used to focus on the traditional areas of financial reporting and tax calculations, today they’re talking about how to identify customers and drive profits, Dicks said. So CFOs are hiring differently, and their expectations are different, he said.
“As business objectives change, the talent necessary to support the work is changing,” Dicks said.
Making more data-driven decisions
For example, instead of moving from a contributor role in accounts receivable to a management role in accounting, a financial planning analyst might move into IT to round out their technology skills, the report said. “From there, they may move into commercial or marketing analytics—and then back into finance with the goal of a business-unit CFO role.”
So, it is important to ensure existing finance staff gets the experience needed to understand financials, the business, and technology, the report said. “Critical finance jobs in the future are likely to demand a holistic business education, as opposed to specializing in one area, like accounting or treasury.”
The CFO’s organization is transforming faster than other areas of the business, according to Dicks, “because the finance function is inclined to … pull insights out [of data] faster and drive for cost savings. That’s not surprising, given the role CFOs play around cost containment and efficiencies.”
Technology, data science, analytics, and data management are some of the new skills organizations need to be brought into the finance function, Dicks said. Because organizations are using more data to make decisions, this is requiring employee roles to change. More behavioral skills are also needed, he said, meaning the ability to put a report together and explain it in an understandable way through data visualization.
“As you move higher up within levels of the organization being able to tell that story in a complete way that is supported and understood–that’s the type of skills finance organizations are transitioning to.”
Finance organizations will have to make a decision between value creation and cost efficiencies, because, “it’s hard to do both at same time,” Dicks added. “If it is cost efficiencies, you’ll see head counts go down. It will take less people to deliver the same services. A lot of our clients are looking at how to reskill their workforce.”
In 2019, the focus was more on the value creation side, he said. “It will be very interesting as the economy meanders through 2020″ to see if that continues. Deloitte’s separate CFO survey, “still is generally positive for the economy, but not as positive as it was six to nine months ago.”
Now, he said, “we’re seeing the beginnings of a move toward cost efficiency and managing costs as a finance function,” with a balance between short-term and long-term trends, Dicks said.
“The finance workforce is being pushed … to make statements clearer, provide greater insights and in the part of the organization that used to create spreadsheets and manage data, the expectation is you can tell a story with the data.”
Some of the basic, “What was last quarter’s revenue and how did it compare to two quarters ago?” is being automated and moved into self-service so business units can find that information themselves, and finance can focus on providing the insights, not just providing the data, he said.
Another one of the report’s findings was that much of the finance organization “is leaning toward and taking advantage of the gig economy and freelancers and contract workers,” Dicks said, due to the scarcity of data skills.
For Dicks, a surprise finding was that there is a juxtaposition between what CFOs are looking for and how organizations are going about making that happen.
While CFOs, “absolutely expect the way they deliver value and the work they do to change … the skills and roles and composition of their workforce is not happening as quickly.”
For example, when Dicks talks with a CFO he hears all about the changing hiring strategy, but job descriptions don’t reflect that. “They reflect yesterday’s skills,” he said. “HR and finance aren’t working together on how to source and train employees.”