In the 2000s, many finance teams still enjoyed the stability of long-term, seasoned employees that were groomed as part of rotational cross-training programs. These programs ranged from entry-level to management programs for developing leaders. Employees would spend 12 to 18 months in a very specific area, like intercompany or treasury accounting, and then either move up in the team or rotate into another area to broaden their value to the company and give them new challenges to tackle.
2021 and the Great Resignation
Capping a trend that had been building for over a decade, the so-called “Great Resignation” saw millions of people leave their jobs over the course of 2021. The job losses and shortages are hitting companies where it hurts, too. A recent Forbes article highlighted, “job losses during the pandemic particularly hit the age extremes, the under-30s and the over-50s.” Companies are losing leaders and experience while at the same time, not replenishing those lost professionals with new graduates or junior staff.
A Strong Need for Treasury and Finance Talent
Deloitte’s CFO Signals™: 4Q 2021 Survey found 79 percent of CFOs plan to allocate capital to new business investments and 67 percent plan to pursue M&A and new ventures in the new year. These types of strategic initiatives require experienced people. Companies and organizations unable to retain top talent and who struggle to replace key roles will be at a competitive disadvantage.
Fortunately, improving employee retainment is interrelated with value generation. The more challenged the employee, the higher their job satisfaction. And the more they rise to those challenges, the greater their business outcomes.
Digitally transforming finance and treasury organization should consist of initiatives to help not only retain employees but increase the value from their contributions. “You won’t lose your job; you will just have a better job” is key to this evolution. The time saved by productivity improvements is redirected towards analysis and strategic work. This empowers finance teams, connecting them to the team and organizational mission.
Steps to drive financial digital transformation that will help your organization deliver greater employee satisfaction and value through:
- Payments – with new payment channels and instant payment networks looming on the horizon, a payment optimization project offers both challenge for finance and treasury teams and significant value for their organizations. Determining the cost/benefit of real-time payment use cases, identifying opportunities to use cryptocurrency and blockchain to reduce FX costs, performing a greenfield analysis to identify the value of unoptimized payment discounts and payment terms across supplier spend, and reconstructing a digitized payment policy to combat payments fraud help modernize finance teams, reduce costs, and unlock new business opportunities.
- APIs – as finance teams migrate to cloud ERP applications, the need to connect apps and workflow to the ERP increases. APIs are the answer. Data unification, increased internal governance, and two-way instant conversations between ERP, treasury, and banking partners are all use cases brought to life through APIs. Empowering employees to envision and design extreme automation through composable financial systems connected via APIs increases the value of ERP platforms and eliminates the need for manual work and semi-automation. Especially with millennial team members who think less about legacy processes when problem solving, implementing an API strategy will be highly effective and unleash significant business value.
- Artificial Intelligence – AI is continuing to drive both transformative and problem solving for CFOs. In a recent Gartner survey, the results are very clear: CFOs must start the transformation effort or risk being “left behind”. In fact, according to the survey, 90% of CFOs have some form of AI on their investment roadmap. But, is it enough investment to shift perceptions of the workforce? To be successful, CFOs and CIOs must work together with Finance leaders to identify not only transformative efforts, but problem solutions too. This is the key starting point in understanding how to use data to leverage AI to predict behaviors and exceptions in areas such as cash forecasting, reconciliations, and payments. There are examples that can be built upon this data baseline and even more where simple cognitive and machine learning apps can offer incremental improvements to improve forecast accuracy, expedite financial close, identify inefficiencies in the AP and AR cycles and identify outlier or suspicious payments requiring further review. Each offer their own set of wins for team members while consequently delivering bottom line improvement.
- Workflow Redesign – Remote work is now considered the new normal, particularly for core, operational work; it is essential in a successful business continuity plan, to keep productivity high in a distributed work environment. With full-time remote work now a norm post-COVID, treasurers and organizations are required to enforce detailed processes for daily treasury workflows such as payments, cash reporting and bank account management. This no longer needs to be the case; controls and validation can be automated through machine learning and automated workflows. With APIs and better reporting and integration, core tasks like bank account management, debt covenant management, trade finance documentation, parental guarantees, FBAR reporting and other manual activities should be standardized.
Your new employees, all part of the “impatient” crowd will stay longer when they know they aren’t wasting time with manual compilations or creating spreadsheet models better done and automated through technology. However, regardless of where you are in your systems journey, digital transformation is the way to expand not only strategic C-suite initiatives, but to help you win the war on retaining employees for longer periods of time and extend the value you derive from your workforce and staff.