Learning & Development, Technology

Finance Isn’t Automating Fast Enough: HR’s Role in Accelerating Digital Adoption

From credit risk intelligence and anti-money laundering to fraud detection and compliance, AI and automation have become integral in financial operations. And research has shown that AI has helped companies yield more accurate business models, gain a competitive advantage, and increase their annual revenues.

But according to a new study by Creditsafe, most finance teams don’t see the value and ROI that can be gained from AI with 63% saying a lack of automation creates little to no risk for their business. Is this confidence based on fact and data, or is it based on hope and assumptions? I’d argue the latter is more likely the case.

Finance teams simply aren’t automating fast enough to catch up with other departments, let alone reap the same benefits other departments are already seeing. But I don’t want to finger point and say it’s all up to finance to fix the problem. While finance teams have a considerable amount of work to do to remedy this, they’ll make far more inroads if they partner up with the HR team. Yes, you heard me right. Let me explain why.

Finance and HR: An Unusual, But Impactful, Coupling

It’s no secret that finance teams haven’t been all that keen to embrace AI over the years. Compared to other departments, finance is more traditional and prefers using manual processes and Excel sheets whenever possible. But this reluctance has less to do with a fear of AI’s capabilities and more to do with historic generational tech gaps and limited budgets.

Unfortunately, these challenges aren’t just being felt by the finance team – they’re spilling over onto HR too. For example, 29% of the respondents in the Creditsafe study said not having enough budget and resources was the biggest challenge they faced with recruiting and retaining finance talent. Meanwhile, 19% of finance managers believe insufficient digital skills and lack of experience with finance software make it hard to build strong finance teams.

So, the obvious (but rarely identified) answer is for finance and HR to couple up. How would this coupling work? Finance should sit down with HR to map out the hiring budget. Both sides should make sure enough money is allocated towards upskilling the existing finance team. Both sides should also work together to identify any gaps in the finance recruitment process and see how those gaps are putting the finance team further behind the digital transformation curve. From there, both sides should agree on and set up new processes embedded with digital maturity and AI awareness.

By coupling up on the finance recruitment process, HR will likely see that the recruitment process will be quicker and result in more qualified candidates. And the finance team will see that they are bringing in more digitally mature team members, which means automating financial processes will be less of a burden and lead to improvements on the bottom line.

Tackle the Historic Generational Tech Gap

Historically, there’s a generational tech gap in the accounting and finance workforce. Most of the accounting and finance professionals in companies today are baby boomers. These workers are older (around 60 years of age) and are fast approaching retirement age. Growing up in an era of fax machines and answering machines, they’re not as digitally savvy as younger workers. But then you have the younger workforce – Gen Z and millennials. This generation is ambitious by nature and have grown up with digital and mobile devices at their disposal from an early age. So, they’re more up to speed on new technologies and are more comfortable embracing AI and automation in their work lives.

Baby boomer financial executives are getting ready to leave their careers behind for a slower, simpler life. But there’s a big problem – there aren’t enough young workers interested in taking their place. In fact, only 10% of young adults are interested in finance as a career option. And with an estimated 773,800 new jobs expected to be added to the finance and accounting marketplace by 2026, that generational tech gap is only going to grow wider.

So, what can HR teams do to tackle this historic generational tech gap?

  • Increase the company’s presence at universities and colleges, specifically focusing on business and finance students.
  • Host hackathons, specifically designed to come up with new ways to improve financial operations and drive bottom line growth through the use of AI and automation.
  • Invite younger tech savvy employees to host lunch and learn sessions for the finance team so they can get more comfortable with using AI and automation.

Audit the Finance Team’s Digital Maturity and Invest in Upskilling

As our study reveals, it’s quite common to see finance teams have limited budgets and a digital skills gap compared to other departments. But these two challenges are often a key reason for finance recruitment challenges. As I mentioned earlier, 29% of finance managers said not having enough budget and resources was the biggest challenge they faced with recruiting and retaining finance talent. Plus, 19% believe insufficient digital skills and lack of experience with finance software make it hard to build strong finance teams.

If companies want to see more of their finance teams embracing tech, AI and automation, then they need to invest in upskilling the employees they already have. But this is where a lot of companies fail because they focus on short-term results and then forget about it a few months later. Upskilling needs to be a strategic initiative that starts with analysis of the current finance team. And this is where HR should come in and play an active role.

The HR team should ask each member of the finance team and new candidates the following questions:

  • What do you think AI is and what does it do?
  • What are your concerns about how AI and automation could affect your performance and job stability?
  • Have you ever used any type of tools for automating financial processes? If so, what was your experience like? Did it feel weird and uncomfortable? Did it feel satisfying when you could ditch repetitive tasks?
  • How would you like to cut back on the amount of time you spend on monotonous admin tasks and instead, contribute more to the financial strategy?
  • Would you be more open to using AI and automation if ongoing training and workshops were provided throughout the year?
  • What if you could use AI to improve the accuracy of your analysis and make better decisions? 

Once they’ve asked these questions, it’s about getting a clear picture of the digital skills, savviness and readiness of the existing finance team and identifying what levels and types of training will be most useful to properly upskill them. This is something a lot of businesses skip – mostly because they’re going into it with assumptions of what teams know and don’t know. That’s not going to help the situation. This is where HR needs to step up and take responsibility for understanding what’s causing recruitment and retention challenges – and building the necessary training programs to fix them.

For example, if a few members of the finance team lack any skills with digital beyond using Excel sheets, this will indicate that this group needs basic training to start. But if other members of the finance team have used some digital tools and platforms to automate AR and AP, for instance, then you’d likely want to set up mid-level training for these employees that dives deeper into those tools to make sure they’re getting the most out of them and automating the AR/AP processes in the best way possible.

By increasing budget allocations to train and upskill talent to be more tech savvy, you’ll start to see a change in how other teams value the finance team’s contribution to growing the business long-term. For the HR team, that means you’ll see employee satisfaction increase and it’ll be easier and quicker to hire and retain strong finance teams. So, it’s a win-win for both teams.

The key takeaway here is that you can’t just use a one-size-fits-all upskilling program on your team. Each person’s technical skills, comfort level and willingness will vary. So, you need to customize the upskilling efforts based on these factors. And HR can’t leave it to the finance team to do it all on their own. It needs to be a partnered approach.

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.

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