If you’ve ever watched a sci-fi TV show or movie, you’ll know that robots and technology are shown as something to fear and run away from. In the business world, this narrative has resonated in some industries more than others. The finance industry, for example, has historically been slow and hesitant to adopt technology into its roles and processes. This is a profession that, in many cases, still uses Excel sheets to maintain ledgers and manage debt collection.
A report by data aggregator Emolument found that 47% of employees in financial services believe technology is putting their job at risk. Since this report was released in 2016, there have been some improvements in the adoption of tech. But there’s still a long way to go.
But this narrative of fear is more than inaccurate; it’s causing cash flow problems for businesses. In fact, 37% of North American business leaders believe their biggest cash flow management mistakes are caused by tech and automation lags – with manual, outdated processes and tools (21%) cited as their top mistake, followed by failing to automate their accounts payable and accounts receivable processes (16%). And that’s certainly not something businesses can afford with a recession looming this year.
Sit down with the finance team to understand their operational challenges and inefficiencies.
As an HR professional, you’ve got hundreds of open roles across every department that need to be filled. But you’re not usually the one with the most knowledge about what’s needed for each role. That’s typically the hiring manager who knows what they need, what goals they need to achieve and what metrics will be used to measure success. So, don’t just take a job description from the hiring manager and start looking for candidates.
Have an honest chat with the hiring manager. Understand why the open role has even been created. Is there a specific problem on the team that needs to be solved? Do they need to scale operational efficiencies and need this person to manage that? As an HR professional, it’s your job to ask the right questions. Also, review the job posting to get a clear understanding of the requirements – make sure you know what’s classified as a mandatory requirement and what falls into the nice-to-have category. This will be critical if you want to vet candidates quickly and effectively.
If your Head of Finance says it’s mandatory that all candidates have a minimum of 3 years of managing Accounts Payable and that they have experience using digital ledger management tools and credit risk intelligence platforms, then you can easily weed out candidates based on this criteria.
Make technical skills and experience with key solutions a requirement in job postings.
I hate to say it, but finance departments tend to be inefficient and waste a lot of time using manual processes. According to Airbase’s Annual Survey of Finance Professionals, 36% of finance professionals use spreadsheets and CSV files to transfer data manually to the general ledger. The survey also found that 97% of finance professionals waste time chasing down invoice details every month.
It’s easy to identify that a problem exists. But the harder part is coming up with a solution. And I’d say that the first step to fixing these inefficiencies is to make technical skills and a track record of success with automating processes a mandatory requirement in finance roles. That starts with reworking the job descriptions for your finance roles.
So, before you hire your next finance role, you need to look at the job description and make sure that it includes key digital skills and experience using various tools that would be key to automating processes and improving efficiencies. Make sure it’s clear in the job description that these skills aren’t just nice-to-haves; they’re a mandatory requirement.
Use a technical assignment to test candidate’s skills and experience with tech and automation.
It’s easy to put specific requirements in a job posting. But if you don’t ask the right questions during the interview process or don’t test candidates’ understanding of specific technical skill, then you could end up with another team member who is averse to adopting technology and automation in their role. And that’s just not going to work for your business, especially as you’re likely to face more cash flow and debt problems during the current economic downturn.
Technology can and should be a finance team’s ally. It’s about making sure candidates have experience using the right tools and understand how to make sense of financial data to best manage the company’s finances and keep cash flowing.
For instance, a lot of businesses use ERP (enterprise resource planning) software to plan, budget, forecast and report on financial performance. So, make sure candidates have experience using this type of software. But also make sure candidates are aware of the challenges that come with ERP software. For instance, ERP software isn’t correctly implemented across all functions, which leads to internal errors and failures. Another problem with ERP software is that businesses don’t properly integrate their ERP software across their entire technology stack. And it doesn’t always have accounts receivable (AR) metrics, which could put the company at risk of increasing their DSO (days sales outstanding) and reducing their cash flow significantly.
So, make sure that you ask specific questions during the interview process to see how well candidates understand the benefits and challenges of ERP software. Make sure they feel comfortable using credit risk data to get a clear picture of how likely customers are to pay their invoices on time. This kind of knowledge and experience using credit risk data to make the right decisions for the business will be critical for finance professionals to do their jobs well.
Offer upskilling to your existing finance team.
It’s important that you don’t forget about your existing finance team. You hired them for a reason; don’t forget that. Now, show them you’re invested in their personal and professional development by offering them training and learning opportunities to improve their technical knowledge and skills. If they’re expressing concerns about it or feeling uneasy about it, help them understand how it will make them more productive, make their job more rewarding and help them advance in their careers. It’s a win-win.
You don’t want to ignore your existing finance team. If you’re hiring tech savvy and digitally skilled candidates, you want to make sure that your existing team won’t feel threatened and will have a similar skillset to collaborate with new team members.
Another great way to upskill your existing finance team is to host informal lunch and learn sessions. This is a great opportunity for some of your more tech savvy team members to showcase their experience and knowledge with technology. For those who are looking to upskill, this can feel less daunting and less intimidating.
Matthew Debbage is the CEO of the Americas and Asia for Creditsafe. As a longtime veteran of Creditsafe, he has held various leadership roles including COO of Creditsafe Group and CEO of the Americas and Asia since 2012. Over the last 10 years, he led the expansion of the business in the United States, where he has built a high-performing team, driven impressive revenue growth and worked with thousands of American businesses across various industries.