Winning the Finance Talent War: Five Strategies

Paul McDonald, Senior Executive Director Robert Half
Jay Thompson, Managing Director Business Performance Improvement, Protiviti

Recruiting and retaining the right resources in the finance function has never been more critical due to accelerating adoption of new technologies and complying with a growing list of regulations. But a finance labor shortage often stands in the way of these imperatives, posing operational risks.

Protiviti’s latest Executive Perspectives on Top Risks Survey, conducted annually by Protiviti and North Carolina State University’s Enterprise Risk Management Initiative, identified talent and culture as top risks, along with technology and innovation. Chief financial officer (CFO) respondents to the survey named “succession challenges and the ability to attract and retain talent” among their top five risks and gave it a higher risk rating than last year.

The Benchmarking Accounting & Finance Functions: 2019 report from Robert Half and Financial Education & Research Foundation cited “hiring skilled professionals” as finance leaders’ greatest challenge. More than 90% of CFOs in the U.S. and Canada struggle to find staff; many other countries feel the same pinch.

November’s U.S. Bureau of Labor Statistics’ Monthly Job Summary confirms the surveys’ sentiment. While the report showed a general unemployment rate in the U.S. of 3.6%, the rates for financial managers, analysts, accountants, auditors, bookkeepers and clerks are all below that already-low average.

New Technology, New Regulations

Finance leaders struggle to find skilled resources even as they deal with growing compliance obligations and digital transformation initiatives. Cloud applications, automation and recent major changes to accounting standards are some of the major trends that can alter labor demands — necessitating a change in skills, a change in staffing levels or both.

Cloud Adoption

Firms are increasingly looking at cloud-based alternatives to their on-premises enterprise resource planning (ERP) and other systems. Our 2019 Finance Trends Survey shows that CFOs are growing more comfortable with hosting financial information in the cloud, recognizing advantages in performance, availability and security. In 2018, 25% of U.S. firms had no plans to use cloud technology. Those numbers fell three points by 2019. About 75% of survey respondents already have applications in the cloud. This trend calls for finance talent that is digital-savvy and can adapt to new applications quickly. The traditional custom-developed accounting software is disappearing quickly, and so will the people who resist the change.

Robotic Process Automation

Robotic process automation (RPA) is another strong trend in finance. The Benchmarking Accounting & Finance Functions: 2019 report showed RPA can accelerate financial processes, reduce manual work, and improve consistency and speed. Organizations in North America have increased their use of RPA for finance and accounting tasks. For example, 39% of firms with revenues of less than $500 million have automated financial report generation, compared to 16% last year; for businesses with revenues of $500 million or more, the number jumped from 12% to 44%. The efficiencies that RPA brings don’t necessarily result in staff reduction; for most leaders, reducing staff isn’t RPA’s primary purpose — rather, it’s reskilling workers to perform more valuable tasks or handle exceptions.

New Standards and Regulations

In the past two decades, compliance obligations have only grown in scope. Even as costs and hours related to compliance with the Sarbanes-Oxley Act (SOX) remain stubbornly high, recent changes to lease accounting and revenue recognition standards, and new regulations like the European Union’s General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (as well as other states’ privacy acts), have created a crunch for talent to address them within deadline. Most leaders whom we surveyed during a recent webinar (74%) recognize a trend and expect the compliance burden to continue to increase.

Winning Workforce Strategies

Finance leaders can’t simply relax job requirements when the labor market is this tight. Still, they’re wondering if they have the right people on board and where they can get them. Here, we examine strategies that help finance leaders retain, develop, recruit and augment staff.

  1. Retain your professional core. The professional core consists of well-qualified, hard-to-replace leaders, managers and technicians whose skills are essential to a firm’s continued viability and growth. Competitive salaries are a fundamental strategy to retain these gems (salary guides provide insight), but other benefits help with retention, too. Educational benefits and growth opportunities help keep resources engaged. Many professionals choose employers that support specific causes; they work for more than a paycheck. Flexible schedules and remote work appeal to many employees, too.
  2. Search more broadly for a good fit. At a recent webinar, a board member asked how his company can recruit a new CFO more effectively. We suggested that the hiring committee look at transferable skills to identify more candidates. Industry experience didn’t have to be a deal-breaker; the company could also consider candidates from other industries where finance managers have analogous experience.
  3. Grow the skills you need. Upskilling resources already on board (such as those whose duties may be lightened by automation solutions) demonstrates commitment to staff advancement. Cross-training and other in-house development help leaders nurture the critical thinking, collaboration and presentation skills they’re looking for.
  4. Automate processes. In the U.S., benchmarking survey participants averaged 31 days to generate financial reports in 2018; by 2019, that number fell to 24 days, largely due to RPA. As we mentioned earlier, accelerating processes does not always equate to staff reductions; most respondents didn’t expect automation to produce staff reductions, and some predicted they’d even hire more to meet skill demands.
  5. Partner with managed services providers. Finance leaders are leveraging relationships with managed services providers that can deliver a blend of full-time staff, contract professionals and third-party experts. Protiviti and Robert Half align their managed services offering to the work of Charles B. Handy, who in 1989 described a three-part labor model that he called the “shamrock organization.” The first part is the professional core: well-compensated employees who are vital to the firm. The second is the contractual fringe: project-based resources who are compensated for results. The third is the flexible labor force: They address peaks in work volume. By engaging the right managed services partner, finance leaders can acquire greater flexibility and specialization in their resource mix and can view resource management as a provided service, rather than as a stack of resumes.

How CFOs Are Rethinking Approaches to Resource Finance Processes

In Closing

Finance leaders realize that digital transformation and compliance burdens will continue to hit their departments harder than others. To meet the challenges, the finance function of tomorrow will need to look different from the finance function of today — it will be more automated, more data-driven and more strategic, and its labor force will need to change accordingly. As the war for talent continues, reskilling, automation, expanding the search for suitable candidates, and becoming comfortable and adept at working with third parties are all strategies to help address shortfalls.

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