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UK finance teams flex focus towards digital skills as labour market competition heats up

UK finance teams scramble for talent as the need for digital skills becomes intrinsically linked to growth prospects

UK finance teams flex focus towards digital skills as labour market competition heats up

Finance teams in the UK are restructuring or changing their operating model to meet the current demands placed on this new, evolved function, new research revealed today (29 March).

A new research paper[1], published by American Express, looks at how finance leaders are redefining their role in the face of economic uncertainty.

While 88% of UK finance leaders said they are confident about their business; performance and prospects over the next 12 months, 74% agreed it was getting harder to find and recruit talent into the finance function.

This is likely due to the evolving skill set now required of professionals looking to enter corporate finance. Over the past decade, the finance function has become increasingly digitised.

American Express’ survey revealed 80% of respondents believe automation and new technology are reducing the burden of administrative tasks once undertaken by the finance function.

While there have been concerns a greater use of technology will reduce headcount within finance functions, American Express’ findings show 55% of corporates expect to increase the headcount of the finance function in the next 2-5 years.

“While I do believe there is an inclination to want to reduce headcount with these tools, what I advocate for is up-skilling our finance teams to provide more mindful value-added work by letting software automate the repetitive and monotonous functions,” says Glenn Hopper, former CFO of Sandline.

Instead of reducing team size, senior finance leaders are looking to recruit a new cohort of financial professionals; one with skill sets that are ‘future-proof’.

“With calls from finance leaders for greater digital and analytical skills to interpret and act on organisational data, it’s clear that the finance function is evolving in response to new challenges,” says Stacey Sterbenz, general manager of UK Commercial at American Express.

When asked what skills, if any, will become more important over the next 2-5 years, over half (56%) said data analytics or tech skills, while 36% said strategy development skills. Just 35% cited traditional finance, accounting, or treasury skills.

A further third (33%) of respondents agreed that better digital skills are key to improving the running of the finance function.

“As a result, the importance of having the right business partners in place has never been greater; those who can make sense of complex data and how it relates to a changing and complex external landscape will be better positioned for ongoing success,” Sterbenz says.

Skills are the key to success

Finance teams are highly accustomed to flexing their focus to suit the times and supporting where their business needs it most. To support this agility, robust data and insights that offer a clear view over the horizon are needed to drive faster and more effective decision-making.

To obtain these insights, the survey found that a majority (85%) of respondents believe more accurate forecasting is critical to success; almost two-fifths (38%) cited this as the activity which takes up most of their time and resource.

‘Reporting and control’ was ranked the second most time-consuming activity (36%), followed by strategic planning and financial analysis (34%).

Taking these factors into consideration, over 80% of respondents said access to better quality data was vital to bolstering their finance function’s organisational impact.

“Finance teams are well-practised at adding value to their businesses -it’s in their DNA. But what’s clear is that opportunities remain to make efficiency gains, with signs that their full potential is being held back by less strategic transactional activity,” Sterbenz says.

“Higher quality data, and the insights it can provide, will help finance teams become more strategic and flexible as they respond to a rapidly changing world.”

The finance function is becoming even more data-driven than it is today, with this increased focus on data reflected in skills sought for new hires.

However, today’s finance teams need keen data and analytical skills, as well as a strong foundation of people skills and a collaborative nature if they are going to achieve growth in the years ahead.

[1] This research is based on a survey of 250 senior financial decision-makers, in companies of 250+ people conducted between December 2022 and January 2023. Turnover represented by respondents’ businesses varied from £5m per year to more than £500m.

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