Myths About the Finance Labor Market in the 'New Normal' Dispelled
Our tips for leaders working in finance
Despite being one of the most volatile financial years since 2008, 2020 has proven that almost every industry and organization is far more adaptable than previously believed! The ‘new normal’ sees greater flexibility and even creativity by permanent and contingent finance teams and work environments, and a new focus on crisis management with intense future planning, aided by automated functions. Many organizations across the U.S. and even around the world have had their eyes opened to the importance of better cash reserves and more accurate planning for destabilizing ‘what if’ scenarios. This can only mean good things for both the individual company and the global economy.
The new importance of the finance department
For a strong economic bounce back, the key to success for most industries and firms will be to invest in highly skilled finance teams that specialize in risk management and accurate forecasting with a new focus on sustainable accounting to ensure consistent and sustained growth, come what may. To do this, many will need to see beyond what are considered the ‘myths’ of the finance labor market, embrace change and development.
Myth #1: AI, finance and automation don’t mix
The age-old problem with AI, robotics and automation, is that people worry that human efforts will be replaced by software programs which will lead to redundancies. The truth of the matter is that AI can automate repetitive, data-heavy tasks, freeing accountants up to work on higher-value or more strategic elements, like financial planning or forecasting, thus broadening the role rather than diminishing it.
Although the finance labor market was no stranger to AI and automated processes when dealing with multiple or Big Data projects with sophisticated ERP and financial systems software, and even automated customer services processes, the outbreak of the Coronavirus has propelled finance and accounting teams further into the future with more accounting processes being automated than ever before. It is very likely that this will continue for much of 2020, if not 2021 as well as companies deal with potential backlogs of data, processes, or tasks.
Myth #2: Investing in employees’ work-life balance is counterproductive
Video conferencing technology, sophisticated software that integrates finance functions and applications into one platform that can be accessed remotely, internally or even via mobile, are all relatively new. They allow for a full overview of a wide range of processes and allow for accurate and detailed project management. Unsurprisingly, these technological innovations have skyrocketed in popularity and usage during the pandemic, allowing for streamlined and uninterrupted financial processes to be monitored and implemented remotely.
Being able to login to these platforms remotely has proven to be an invaluable way of working and keeping many companies above water during this time— not to mention the improved productivity they also achieved. It’s still being argued that removing the commute and the physical work space would decrease motivation or impact an employee’s ability to distinguish between ‘work time’ and ‘leisure time’ if they are completing a full days’ work in the bedroom, home office or living room, but the opposite has proved to be the case for many organizations. The rise of flexible working is likely to benefit businesses by maintaining exceptional productivity and improving employee wellbeing and work-life balance.
The importance of the office and having staff together in one place for collaboration and effective teamwork used to outweigh the importance of investing in work-life balance, however flexible working provides working parents with the ability to work hard and care for their children effectively and it levels the playing field for job applicants with health conditions or impairments. Ultimately, leaders will find that their finance teams are fully capable of completing large parts of their jobs and finance functions remotely and will also be happier doing so, ultimately leading to better staff retention and higher productivity levels.
Myth #3: Career paths are set in stone
There is a common misconception that there’s a ‘one-size-fits-all’ approach to people in finance that large-scale corporations rely on to standardize their internal promotion structure. However, as many have seen from the creative problem solving during the pandemic, people in finance are capable of unique offerings and perspectives and should be allowed to shape their futures.
Large companies or very corporate companies have been encouraged for a long time to embrace the adaptable and flexible structuring used by startups for their finance teams. This has benefited startups by allowing their finance workforce to shape their own futures and take more responsibility for the fiscal successes of the company. The new normal will see the shift towards this more flexible model within forward-thinking, mature businesses.
Myth #4: A high unemployment rate means it will be easy to find financial talent
While the profession has seen job losses, often disproportionate by industry or sector, businesses that are currently hiring finance professionals are still finding it challenging to identify the requisite talent, skills, and experience they need today.
The most in-demand financial talent is still highly sought after— and in short supply. Many businesses have the impression that candidates will be available, and at a lower price, but this false utopia will surprise many. While it may seem tempting to hire talent at below-market rates, this strategy is generally flawed, as it will be hard to retain these professionals when the market picks up.
Myth #5: Financial contractors aren’t a cost-effective use of resources
Financial contractors have long been underused due to the misconception about their cost-effectiveness due to their seemingly high day rates. However, incorporating contractors who specialize in finance, accounting, financial planning or insurance can actually save money by plugging a required skill set for a set amount of time, ultimately costing less money than someone employed on a full-time basis with a full yearly salary.
With the backlog of financial processes and functions that may need to be addressed by many organizations for the rest of 2020, contractors will prove to be a cost-effective way of bolstering finance teams and leading the way to a successful end of year and a bright start for 2021.
If you are looking for bespoke advice on how to create a finance team that is tailor-made to suit your needs for the coming quarter, our team of dedicated executive recruiters are experienced and knowledgeable in the current market and can help you build a full-time or contract finance team designed for success. By putting people first, we can help scope out your requirements and source the right talent, ensuring efficient onboarding and sound results.
