I've spent my entire career trying to wake firm leaders up to the importance of talent management strategies. For the past decade, I've campaigned on behalf of the next generation, seeking to persuade established leaders to build firms that next gen talent want to someday own. After all, talent has been—to me, at least—the ultimate strategic enabler. If you have bright, passionate people in place, you can address any market trend, respond to any client shift, and exceed the expectations of others. If you had asked me even six months ago, I would say that, strategically, talent trumps all.
But now, I feel compelled to change my tune and issue a warning, too. Because I truly believe that you must place technology at the top of your strategic initiatives list for 2017–18 (at least). If you don't, then all of the brilliant talent strategies in the world won't sustain you. How come? In this article, we'll explore five reasons that technology has become an even higher strategic priority than talent and five ways to address that paradigm.
Technology is of the utmost importance because:
- Disintermediation will occur. Whether it's the IRS automating simple 1040s and eliminating the "middle man," blockchain technologies reducing the need for transaction confirmations or data assurance, or online transactions automatically posting to ledgers, continued automation is placing pressure on traditional compliance services. Check out this Quartz Media illustration showing which jobs are projected to be most at risk from robot labor. On the far right side—with a likelihood of being replaced by robots in the 90th+ percentile—you'll find accountants and auditors, tax preparers, and bookkeepers. Technology is poised to eliminate the profession's lower level data-entry and number-crunching functions, making it a must for firms to elevate their offerings.
- Efficiency is no longer optional. When you start experiencing a reduction in perceived value for your compliance services, it will be critical that you deliver them with maximum efficiency for as long as they are still relevant. And with the shrinking labor pool driving up labor costs, being able to do more with fewer people—and not burn out your talented team—is a must. To deliver your firm's services efficiently, you must increase automation, including using scan and auto-populate programs for tax, data extraction technologies, benchmarking and big data in audit, cloud and workflow tools in client accounting, and workflow and scheduling solutions across the board. Many of these solutions already exist and can be leveraged by firms of all sizes.
- Data is paramount. Data creation has increased exponentially in recent years, with IBM reporting that 90% of all of the world's data has been created in the past two years alone. Wow! Individuals, entities, governments, educational institutions, and others need help extracting, deciphering, and acting on the information they're collecting in their systems—including their finance and accounting systems. Next generation clients are beginning to expect their trusted advisers to be able to do more than just pull data into a form; they want their advisers to be adept at data extraction, analytics, and intelligence and to deliver insights they can use to make smarter, better decisions. Check out this Intel commercial that illustrates my point.
- Clients expect it. The world is becoming increasingly digital. Today's clients are becoming less interested in the traditional seasonal service delivery format of meet, prepare, and deliver. Instead, they're more interested in a continuous, year-round stream of information exchange, communication, and advice from their trusted adviser. They also are beginning to expect a more digital experience. Because of the marriage of machine learning (where a system learns and remembers your preferences based on your uses) and automation, digital communication platforms are supporting more personalized client experiences and will soon become the norm.
- Next gen talent won't work for us without it. Now, we come full circle. Today, people want to be part of a firm that supports flexible work from anywhere, anytime, so they can integrate their work more seamlessly with their personal lives. They expect the firm's systems to effortlessly support work away from the office with as much speed and efficiency as work done in the office. In addition, future leaders want to work for a leading-edge organization that delivers innovative, efficient, and relevant services. If we don't invest in technology, talent won't be attracted or stay engaged.
So, with the mounting pressure to quickly elevate technology to a core strategy, here are five practical ways to get more in the IT game now:
- Have the right technology resources in place. Be sure your IT leader is an "enabler" and an executor, not a negator or deflector. Seek outside support to augment areas, including outsourcing, where your IT abilities are deficient. Be sure you aren't understaffing in this area. Investment here is a must! Read more strategies for overcoming IT roadblocks here.
- Make sure firm leaders feel "on the hook" for driving IT change in their assigned areas. Task your service-line leaders and operational leaders to identify at least two new technology efficiencies or enhanced capabilities to implement in their areas between now and the end of 2018. Many firm leaders are waiting for someone—maybe IT staff or consultants—to suggest the changes they should make. As the leaders of our firms or functional areas, our job is to follow trends and understand the role technology plays in adding new value, tying our clients or people more closely to us, and in stripping out unnecessary work and hours that are likely at risk to disintermediation anyway.
- Invest in a data analyst. Hire a true data analyst (full-time, part-time, or consultant) and have his or her first project be delivering insights to you from your own data. Your tax database is a wealth of interesting client demographics that can point to the need for additional services. Your billing software promises many more important insights. Learn how valuable data analysis can be firsthand and be prepared then to demonstrate that same value to your clients.
- Form an IT committee and staff it heavily with next gen leaders. Encourage them to get input from clients and internal department heads on their needs and wants. Give this committee a significant voice in your IT priorities and put your energetic, tech-savvy, change-minded next gen participants to work implementing technology change. You'll be surprised by how engaged they become and how quickly progress can be made. Small firms may not need a committee, but can engage a team member to explore a passion for technology, efficiency, and process improvement to bring forth ideas.
- Accept good instead of perfect. Technology change is rarely perfect, and hiccups are to be expected. Pilot everything to work out the kinks before going full force and be careful that you don't spend so much time analyzing, debating, and perfecting that you miss the window to compete.
I grew up in technology and was just starting out when the personal computer transformed business. Since then, technology has progressed, but it hasn't seemed as big or impactful as it is now. Technology is going to change just about everything about the way we transact our business, produce our deliverables, and maintain our relationships. And it's happening fast. If technology isn't at the very top of your firm's priority list, please reprioritize or risk losing it all.
Jennifer Wilson is a partner and co-founder of ConvergenceCoaching LLC, a leadership and management consulting and coaching firm that helps leaders achieve success. Learn more about the company and its services at convergencecoaching.com.