The role of technology in job destruction and creation has been a source of heated debate since the industrial revolution. Whether it is farm machinery, telecommunications or transport, rapid changes in technology have transformed economic development – on the one hand displacing outmoded ways of working and yet on the other spawning entirely new industries and opportunities. However, in recent times attention has been focused on the “jobless recovery” with technology being seen as the culprit. So does the relentless pursuit of automation and process innovation herald lean times for the finance function or a new dawn of opportunity and prosperity?
Here are 5 reasons why FSN is optimistic about the future of the modern finance function – but there is a ‘sting in the tail’.
Obsolescence and renewal creates inherent opportunities
Take the progression from mainframe computer, mini-computer, personal computer, laptop, tablet and smartphone. Each successive wave of computing has been more voluminous and pervasive (roughly ten times the volume of hardware shifted in a tenth of the time) – creating jobs in its wake.
And it’s not just hardware. The same can be said of operating systems, databases, ERP systems and now cloud-based financial management platforms
Today’s innovations will create new jobs as modern finance functions seek to leverage process innovation for competitive advantage.
Technology opens entirely new finance disciplines and roles
We can all think of entirely new industries that have been created off the back of new technology, for example, social media, website comparison sites, satellite navigation and computer dating. But the world of finance has also been transformed, both in the accounting profession (forensic accounting, litigation support, business modelling & systems consultancy) and in commerce. Opportunities are arising as modern finance functions find themselves drawn more deeply into analytics & data science, financial systems, e-filing, strategy and performance reporting.
Technology-infused business models drives complexity and opportunities for top-flight finance professionals
The coalescence of huge advances in raw computing power coupled with modern business technologies (social, mobile, internet etc) has created the conditions for unprecedented complexity in business processes. In effect, the more we can do, the more we do. Consumers have never had such choice! (Even regulators have jumped on the bandwagon, clamouring for more data and electronic filing).
And as more businesses become ‘data-driven’ this fuels ever more demand for finance professionals who can unravel complexity and deliver business insight.
Technology drives prosperity
Technology is often seen as the villain of the piece – driving people out of jobs but a more holistic economic view suggests the opposite is actually the case because technology creates prosperity. Take for example ERP systems which have drastically reduced average transaction costs since they were first introduced in the nineties. Lower business costs and greater productivity has lowered the cost of doing business (even small businesses can take advantage of sophisticated low cost applications in the cloud) and this translates into less expensive products and services, which, in turn, drives consumer demand, wealth creation and growth.
Technology shifts professionalism onto a higher plane
If there is one common pattern over the last three decades it is that in all industries, technology displaces mundane and manually intensive work first. Comptrollers with large-handled adding machines have disappeared, computer tapes and fax machines have all gone, along with the people who used them. And the many manually intensive steps in core financial processes have been displaced by work-flow, integration tools, unified applications, automated controls monitoring and, more recently, embedded social tools.
All of this has shifted the emphasis away from basic accounting to more value-added activities around better business partnering and smarter decision-making. In this new era, finance professionals who are on top of their game can expect more rewarding and fulfilling roles.
………and the sting in the tail?
Put bluntly – experience is no longer as valuable as new skills. Remember when cobol, the main programming language of business applications was displaced by C++? Computer professionals with decades of experience were cast aside in favour of younger professionals who had new skills but relatively scant experience. The writing is on the wall for finance professionals as well. Those finance professionals that do not re-skill, become tech-savvy and adapt to a new age of business partnering, analytics and process innovation will get left behind. So seize the day!