The finance team constitutes the fulcrum of a company for its smooth functioning. Any failing in terms of competencies in finance talent management invariably reflects upon the results of the company. In order to establish a fact-based framework for finance talent management, the Arlington-headquartered CEB with a remit to purvey dependable data and tools and best practice research to senior executives the world over, surveyed nearly 700 finance managers at more than 75 global companies, including in India, on their competency levels. The survey evoked salutary reviews from Wall Street Journal, CFO Innovation Asia, Washington Post and CFO Insight.
Lead author of the pioneering research survey and CEB’s India operation senior director Kruti Bharucha told The Hindu that “the hardest part about managing talent in the context of changing business needs and a complex business environment is to understand which competencies truly matter most and are most important in driving business value”.
“Our survey included around 20 Indian organisations and we surveyed approximately 900 finance staff at these companies. We found that Indian finance teams are very strong technically and have very good functional knowledge but are weak on areas like team management, communication and leadership. Having a strong technical team will help you run a finance operation without glitches (it will help you ensure compliance and proper accounting) but it doesn’t help you build a leadership pipeline of individuals that can be the next set of CFOs or Business Unit Heads,” Ms. Bharucha said.
She said the natural tendency is to hire functional experts and develop more technical skills rather than build the softer skills that the business truly needs and values. “During this research initiative, we also found that most Indian companies, and especially finance departments, tend to overweight the importance of competencies that are focused on execution, like effective project management, able to execute independently, etc. This is fundamentally focused on building and developing the wrong skills in their teams.”
The best companies and the true talent leaders actually give more importance to what we call the ‘Builder, Persuader and Strategist’ competencies: these include areas such as team management, leadership, communication, persuasion, and understanding of business operations. This means that Indian companies have to acquire a new approach to talent management. Rather than continuing with the same strategies of the past, these new ‘softer’ competencies require a different set of approaches to hire and retain the right talent and talent leaders have unique solutions to get the right blend of competencies, Ms. Bharucha explained.
In this context, she noted that talent leader organisations have revamped their hiring methods and introduced new-in-kind assessment methods like case-based interviews that are better at identifying proficiency in these softer skills. “I have also found that talent leaders also get creative in sourcing their candidates. They often explore unconventional candidate pools to source finance talent, instead of recruiting for specific positions from typical candidate sources. This way they get a better fit with the competencies they need rather than go after the traditional accounting profile that may not be a good business partner.”
On developing their staff, she said, talent leaders over-invest in coaching, relying less on classroom-based training sessions and encouraging their managers to provide mentoring and professional advice to their direct reports. The best finance departments place significantly more emphasis on the areas of leadership and business acumen for their entry-level to junior managers compared to other organisations — they build these skills early on in their staff’s careers.
To an issue as to how to overcome skill gap, she said the best approach is for each organisation to diagnose how much of a skill gap they really have and then put in place the right set of solutions that will help them close that gap. For some organizations, they may have legacy staff with outdated skills — the challenge there is to either upgrade this staff or to hire new staff that will possess competencies that are most useful for the business.