Before Paul Venables, CPA, became group finance director at Hays, the global recruiting firm with offices in 33 countries, his learning of the financial ropes was logistically simple.
Financial analysis, transaction processing, credit control – those and other functions were in the same location. “And it was easy to get experience,” he said.
Hays, like many companies today, has decentralised its finance department. Although the company headquarters remains in London, some roles are handled by employees in shared services centres and others by outsourced labour in countries such as India.
“That was never an issue for me,” said Venables, 51, who formerly worked for Deloitte and also supply-chain management firm Exel. “Now, if you aspire to be a financial director, you’re thinking, ‘All of my transaction processing is being outsourced; therefore, how do I get experience?’ How do we ensure our leaders of the future are well-rounded?”
Those concerns are echoed in a recent CGMA report One Finance: Building Tomorrow’s Talent Strategy, which seeks to highlight the impact of shared services centres, outsourcing and technology on finance roles within companies and provide guidance for developing talent in a new era. This role shift, according to the report, demands a finance talent pool with a far more diversified skill set. Or, as Udayan Dutt, the head of human resources for Unilever Sri Lanka puts it in the report: “If you want to be an architect, you don’t necessarily need to be a master bricklayer.”
In a recent interview, Venables offered three main takeaways from the report, which was conducted in partnership with Hays:
In lean economic times, it has become more important for companies to have accurate information quickly. “You need a regular flow of information and good finance people who can interpret it quickly,” he said. “Rather than a 20-page report, you need to be given the three things you need to know this month. There’s much greater economic pressure than ever before.”
Driven by a need to reduce costs, companies will continue to use shared services centres and outsourcing.
Given the move to a more splintered finance department, the pressure is on businesses to develop finance talent strategically. “The future finance directors – how do you groom them for success?” Venables asked.
Hays’s answer: Regular and sometimes lengthy visits overseas. Venables mentioned an employee being groomed for a promotion and said that employee is spending three months working outside England. Hays’s UK financial director (FD), according to Venables, goes to India every six weeks.
“For the better people, for the FDs of the future, changing their assignments every couple of years is a good idea,” he said. Depending on the scope of a company’s business, “maybe you do a stint in the US, a stint in Asia and maybe one in South America.”
Venables said another pressure point for businesses is figuring how to devote resources to training when resources are scarce. It’s critical to be selective instead of devoting training time and money to the entire pool of finance candidates.
“The people you develop need to show some talent, show that they’ve added value and will work hard,” he said. “It’s better to target the top 5% or 10% than to place your bets on a number of individuals.”
Graham Baker, the vice president of global finance services for pharmaceutical giant AstraZeneca, foresees basic finance functions continuing to move to offshore shared services centres.
This shift can free up finance managers to be more strategic in their focus. Baker says in the report his company has recognised this need to develop a finance team with a wide range of skills and says that individuals are given more “taster experiences” to learn outside their comfort zone. This developmental cross training can lead to better collaboration.
Related CGMA Magazine content:
“Application of Financial Knowledge Is Critical, Leadership Report Says”: As business grows more global and complex, finance executives must be more nimble in communicating strategy.
“Shared Services: The Keys to Success”: Shared services centres are not solely employed by large companies. They can lead to cost savings even for midsize firms.
—Neil Amato (email@example.com) is a CGMA Magazine senior editor.