The digitalisation of the finance function has been a priority for many finance leaders since the Covid-19 pandemic, but many finance departments still lack the digital skills and competencies needed to fully exploit this opportunity.
According to Gartner, finance departments need skills in five key areas: technology and automation; business process management; data literacy; and advanced analytics – as well as skills that enable team members to partner and collaborate more effectively with the wider organisation so they can act as advisors to the business.
The divide between the ‘haves and have-nots’ in finance will deepen if finance leaders do not address the digital finance skills gaps and that skills shortages will also make it harder for them to capture returns on their digital investments.
Finance leaders must continuously ‘sense’ for new, job relevant skills that enable finance employees to perform their jobs more efficiently and should also keep evaluating how they prioritise the skills they need, Gartner’s research concludes.
One company that has taken this onboard is fast-growing, US-based soft furnishings e-commerce company Saatva. It was set up in 2010, disrupting the traditional market by omitting wholesalers and selling directly to consumers while also using its own delivery services and offering 24/7 customer care services. Headquartered in New York City and Austin, Texas, it now has flagship stores in Washington D.C., San Francisco, Los Angeles, Boston, Chicago, Dallas, Charlotte, and Philadelphia. It is expanding its retail footprint rapidly to markets that include Seattle, Portland, and Paramus.
In the following interview, Lynn Heatherton, executive vice-president of finance at Saatva, explains why and how the company’s fast growth, coupled with an innovative e-commerce business model, has necessitated a strong focus on attracting digital, critical thinking and soft skills to the finance department.
Does Saatva recognise a greater need for digital skills today across its organisation and for its finance function more specifically?
Saatva is the original mattress industry disruptor and the only company to sell luxury mattresses at scale directly to consumers via the internet. As an innovator in the home furnishings space, digital skills are as important today as when the company started and have always been a part of our identity. We are always looking to leverage technology to be the most operationally efficient and provide the best experience for our customers.
For many companies, talent is the most important asset. The finance department’s strength is dependent on the people in the department and it is essential to have the right skills. It is also extremely important to have employee longevity to ensure a good, broad understanding of your business.
What types of digital skills are you looking for within the finance function today?
There are unique needs and challenges when hiring for the finance function. Firstly, a company might require a certain specific skills set, such as knowledge of an industry, ERP software, or specific tax rules. As we hire, we look for candidates with relevant, hands-on experience in the various software programs we use, such as our ERP software or sales tax calculation software.
Employees themselves also need to have the right tools from equipment to software. A year ago, we implemented an artificial intelligence (AI) solution for accounts payable (AP) so that the routine data entry portion of the AP clerk’s job was removed, allowing AP to focus on the higher-value analytic aspects of the job. As the data entry portion of the role has now been eliminated from the job due to AI reading the invoices into the system, we now require AP employees who can focus more on proper classification and expense timing of invoices and reconciliations with our vendors.
Are there any other specific skills sets needed by finance departments today, which can prove difficult to find?
Additionally, what I consider most difficult, is hiring professionals that have strong critical thinking skills. Some finance professionals just consider the formulas or processes – effectively, that is they just do steps A, B and C – and then they are done. I call this assembly-line thinking.
This is very dangerous when you have a smaller finance team that is working for a rapidly growing company. The finance team needs to be proactively reviewing the data inputs and output by checking for accuracy and relevancy to the business. They need to be asking questions like ‘do the numbers support the business trends and activity?’ If this is not the case, then they need to investigate to see if there is a problem with either the numbers or dataset or perhaps if there is an unidentified problem with the business.
Candidates with strong critical analytical skills can take some effort to identify during the interview process. We ask questions that allow them to demonstrate their critical thinking skills and validate their familiarity with the software, but there is no guarantee.
Is there now a need for softer skills and good communication skills – particularly in the finance function?
Softer skills are very important in the finance department. Team members are often the connective tissue that ensures the organisation works well. The finance team needs to deliver numbers and analyses to all departments so that these external departments have the right information to make decisions regarding the performance of the business.
How has Saatva been able to attract the personnel it needs today in a labour market, characterised by a shortage of digital skills?
It is always difficult to attract top talent. However, since we have moved to a work from home environment, we have been able to recruit from a larger talent pool across the country – rather than being limited to our own geographical area. This has significantly helped us in filling specific roles.
What can companies do to make themselves attractive as employers in a tighter labour market?
Attracting and retaining top talent can be challenging. The nature of what makes top talent so valuable is the inherent desire to grow and succeed. Many companies and leaders fail to retain top talent because they assume that their talent knows they are valued and understand where they fit into the long-term vision, and consider that constructive feedback is therefore optional. Retaining and engaging top talent requires leaders and companies to shed those assumptions.