A fast-changing workplace
"Ninety percent of senior finance leaders don’t think their teams have the skills to support their business’s digital ambitions."i
Management accountants have long developed acumen through experience. However, lessons learned through past experiences may provide little guidance for future events. Disruptive technologies are radically changing the way things work. Senior managers are concerned about transforming their business model for the digital age. However, they are aware that most new digital initiatives fail to meet their revenue targets.ii These initiatives can also become a drain on resources, including management’s time. Management accountants are well-positioned to remove the risks associated with changing business models and identify opportunities digital transformation can bring for businesses to survive and thrive. But first, they need to develop their mindset. Management accountants, through providing the professional discipline that informs and guides the management control cycle, acquire a commercial learning mindset. However, the acumen gained through experience may not suffice if disruptive technologies change the way things work. Professionals need to be constantly horizon-scanning with a keenness to learn. New cognitive technologies are emerging that have implications for business models, digital data has the potential to provide new insights, and automation will put more emphasis on value-creation skills.
The ability to anticipate the way things could work in the future will become more important. Making uninformed judgments based on personal experience becomes an unnecessary risk when firm evidence is available by analysing digital data. It will not just be what management accountants have learned. It’s also how they question, analyse, learn, adapt and engage with others.
The management accountant’s mindset has always been forward-looking. It stems from the management and control cycle. The cycle (Figure 1) describes how managers plan, execute, review and report to achieve objectives. At each step in this cycle, managers need the information to inform a decision, to enable its execution, to review progress, to learn from experience and to determine any corrections or improvements to be made.
This is how businesses ensure they deploy resources where the returns or prospects are best. It is also how managers learn through experience. But, that’s about to change. To anticipate and respond to change, organisations need to become agile while managing the business as usual. Rather than risk everything on unproven initiatives, they should experiment and learn iteratively.
Taking a twin-track approach means the business is managed effectively while agile teams develop and implement new strategies. Agile is about accelerating the management and control cycle. A management accountant’s role is well-placed to support the business in a digital age and equipping them with:
Professional objectivity and skepticism
Accounting expertise and business understanding
Questioning and analytical skills
Communication skills needed to engage with others
Figure 1 shows the management control cycle and what must be considered for a digital age.
Figure 1
