FinTechAutomationTackling the treasury skills shortage

Tackling the treasury skills shortage

If treasury is to successfully embrace digital transformation, organisations need new skillsets and capabilities, but how do they go about achieving an upskilled workforce?

According to Korn Ferry International’s Future of Work survey, the world is facing a global talent crisis. In fact, it’s estimated that by 2030, a talent deficit of 85.2m workers can be expected – and treasury is not going to dodge the crisis as it goes through its own digital transformation.

Recent research from The Hackett Group found that the finance/treasury management talent profile is significantly changing, and this transition will require unprecedented levels of re-skilling and upskilling of 54% of employees by 2022. Executives must be prepared to manage the significant implications for talent or they risk losing some of the potential value of increasingly digital operations – up to $82m for world-class organisations.

“To support digital transformation, organisations need new skillsets and capabilities – those in high demand, but short supply,” outlines Steve Wainwright, Managing Director EMEA at eLearning specialist Skillsoft. “Many organisations say the most prominent challenge they are facing is a lack of sufficient experience in candidates. Hiring new candidates with the skills required to be successful in digital transformation is not an effective strategy.

“That’s not to say attracting and retaining the right talent won’t be crucial over the coming years, it will – more so than ever before. But the key to long-term success for many businesses will be providing their people with the opportunities to transition into roles that are more skilled, value-based and rewarding. Businesses need to upskill their current employees to prepare for these changes.

“Businesses know the skills of tomorrow, but helping the employees of today achieve proficiency in them will be crucial to long-term success. Helping employees gain skills that will make them productive in the workplace will also offer their organisation a competitive advantage. It will prepare employees for the roles of tomorrow while driving transformation within the organisation.”

Practical approach to resolving the treasury skills shortage

According to The Hackett Group’s report, to counter the treasury skills shortage, finance functions must define and adopt an integrated talent management strategy that includes a number of specific practices for delivering the skills needed. This strategy should encompass principles for determining which skills and competencies are targeted in recruiting, emphasized in learning and development, and reinforced in job design and performance appraisals.

The practices include:

  1. Identify talent needs

Smart automation, continuous innovation and more agile operating model methods will accelerate the need to retool skills and competencies. The trend away from transactional, commodity skills and toward knowledge-based talent increases the importance of having a pipeline of skilled and experienced employees and leaders. Organizations will need to identify the roles and skills that are essential to performance and assess existing gaps. World-class organizations tend to have more advanced strategic workforce planning capabilities, including formal processes, dedicated people, and fit-for-purpose technology to capture and report data that aids demand planning for future skills in the workforce.

  1. Develop talent

Knowledge-based digital skills, such as strategic thinking, continuous innovation, analytics, and process improvement, are scarce and expensive. Until supply begins to approach demand – which will take time – organizations will have no choice but to prioritize initiatives to reskill and redeploy existing resources to fill critical gaps. Certainly, this will involve training and on-the-job development – but training will differ significantly from models that focus on instructing employees how to perform task-oriented work. Building analytical, project management, critical thinking and business skills involves more intensive effort. Doing so rapidly will require new development methods and strategies, including taking advantage of established external programs.treasury skills shortage

As this shift in development occurs, business functions should begin looking at providing lifelong learning opportunities that foster critical skills at all career levels – from associates to senior leaders. One leading practice for establishing the right skills is providing employees with opportunities to participate in professional certification or credential programs and master classes. These programs can be effective ways to align skills requirements with new expectations for ways of working and the development opportunities that employees desire. They also provide tremendous benefits to the company as employees apply their new skill sets across the enterprise.

Furthermore, organizations should consider refocusing development programs to emphasize skills that are transferable across many functional roles such as analysis, innovation, transformation management and process design engineering. This helps create a versatile workforce that is able to shift easily among roles and functions, and even into the business, to fill evolving needs.

  1. Acquire talent

Similarly, organizations will also need to develop new multifaceted acquisition strategies that include recruiting and use of third-party service providers to find the skills required to execute enterprise and functional objectives. As companies prepare for the next-generation workforce entering the market, they will begin to pull from and rely more on higher education to fill new roles for the future.

  1. Drive talent performance

The new integrated talent management model should include greater focus on retaining people and skills to preserve and maximize the organization’s investment in training and developing employees. To bolster performance as well as recruiting, organizations may need to re-envision their employer value propositions and career development models to engage and motivate digital workers.

The cybersecurity challenge

According to Andy Barratt, UK MD at cybersecurity consultancy, Coalfire, cybersecurity needs to be top of the list for corporate treasurers as their role becomes more digitally focused.

“As companies continue to digitise, the risk of cyberattacks increases in both likelihood and sophistication,” he says. “For corporate treasurers, this risk is amplified as their access to highly sensitive data and ability to move large financial sums makes them an attractive target to cyber criminals. Indeed, a recent survey of corporate treasury and finance professionals found that cybersecurity was their most feared operational challenge.

“Their license to move substantial sums of money around in order to manage corporate interests means they’re not subject to the same restrictions imposed on other parts of a business. It’s this operational freedom that cyber criminals are able to take advantage of.

“With this in mind, the need to be diligent when it comes to implementing proper cybersecurity practices is more pressing for corporate treasurers. Awareness of the potential threats is therefore vital.”

Barratt says that one way a cybercriminal might attempt to take advantage of a corporate treasurer’s position, for example, is through phishing scams. This is where hackers pose as a trustworthy entity – often via email – in an attempt to obtain usernames, passwords or other security details. If a corporate treasurer unwittingly handed over their access credentials in this way, a cybercriminal could use the treasurer’s digital persona to operate freely for a worryingly long period of time before raising any alarms.

“Basic cyber principles like managing access privileges, advocating the use of robust password protection and implementing two-factor authentication are some of the most easily achievable first steps a business can take towards protecting itself from these kinds of threats,” he suggests.

“However, it’s not just malicious interference that presents a problem for cybersecurity. Our own research shows that human error continues to be a company’s biggest security weakness. By failing to implement proper cyber training, a business could inadvertently be creating a new form of threat from within.

“That’s why it’s essential that businesses provide all staff, from the boardroom to the shop floor, with the necessary cyber knowledge in order to spot potential threats and know how to act when they happen.”

The time is now

The corporate finance function – including treasury – has reached a critical moment. As the demands on the job grow and the strategic positioning of treasury develops, there’s a need to pivot quickly to technology in order to automate and add value. This, in turn, requires a ‘next-generation’ talent profile with the relevant skills.

As the Hackett Group report says, given the pace of change, finance functions that are not taking action now to advance their talent management strategy and facilitate development of essential digital skills will find themselves struggling to deliver on evolving enterprise objectives.

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