Clive Webb

The finance function is made up of four pillars: people, process, technology and data, and three critical elements are reshaping it. First, transactional efficiency: introducing automation to, say, accounts payable and receivable, changes the transactional role from being purely physical data capture to tackling the exceptions and the outliers within the process.

Second, broader data informing reporting, governance and risk; how the function provides the information to external stakeholders and how they approach enterprise risk, particularly post-pandemic. “Organisations must realise what risk management and good corporate governance now needs to look like,” says Clive Webb, head of business management at ACCA, who has overseen extensive research into the future of the finance function.

The third element is about creating the value-add, which pulls a lot of the focus when CFOs discuss the future of finance. This means delivering insight, and not just on past performance. “You’re not driving a car through the rearview mirror; you look through the windscreen ahead of you,” says Clive.

To be able to forecast accurately, you need strong data, and a solid understanding of the business model and the data supporting it. Finance must facilitate and drive decision-making, to the extent to which they are monitoring the decisions being made. “You need to be a core part of that process.”

The pandemic has accelerated the adoption of some of those elements. Transactional efficiency has increased as organisations adopted more automation and technology. There has also been a greater focus on delivering insight, helping the business be more agile and customer-centric.

However, there are variations according to organisational size, geography and industry. It’s easier for very large enterprises and small businesses to adopt this technology than mid-tier companies, says Clive. The larger technology platforms, such as SAP and Oracle, are prohibitively expensive for middle-sized companies, while tools such as Xero and QuickBooks don’t offer enough for them. “Mid-tier organisations don’t have the level of investment of the larger ones or the ease of scale-up of the smaller ones. They find the whole software-as-a-service, cloud-based solution argument a harder one to adopt.”

The pandemic has also highlighted discrepancies between the digital infrastructure of various countries. For example, Canada has a very traditional, paper-based banking system; the biggest issue that finance teams faced was how to print out cheques at home. Some companies actually shipped cheque printing machines to employees’ homes. East Africa, by contrast, is extremely digitally-focused, with a prominent mobile banking industry. All of these factors are influencing how advanced a finance function might be.

“There are lots of finance functions on the journey, and there are a lot of finance functions struggling on the journey,” says Clive. “It’s a mixed picture, but it is a picture of opportunity. It’s not a picture of failure.” What does this mean for skills? First and foremost, technical and ethical skills are still important. “We can’t forget what accountants are.”

Beyond that, accountants need the ability to understand data and business models to a detailed degree, and the technical skills to be able to interrogate, manipulate and forecast that data. This needs to go beyond the functionality of Excel, which accountants tend to cling to, says Clive.

“The level of sophistication of the forecasting means that you need to understand how to visualise data, how to self-serve data, how to use AI and machine learning to produce more forecasts and the tools that enable you to produce more forecasts. It’s about the technology of the business overall and how to be broader within that.”

Then comes the storytelling that comes with the data, and to do that, you need to build trust. Clive cites Maister’s Trust Equation as a good model to follow when developing relationship building skills.

“His argument is that trust is about intimacy, the relationship between two parties. It’s about the credibility – do I actually tell a story that is believable and can be trusted? And reliability – am I able to deliver what I said I was going to deliver in a way that creates a relationship. You can destroy it all by demonstrating self-interest. It’s not about ‘me’ it’s about ‘us’.”

Critical thinking and influencing skills are attached to that. “The true accountant in business is a strategic advisor. One that understands data and technology, but has a core backbone of accounting skills and ethical values.”