Finance transformation: the impact on talent
While finance transformation has helped companies to increase the efficiency and optimize the performance of their finance function, it has also had major implications for talent development – and not all of them have been positive.
As explored in Ernst & Young’s recent report, Finance forte, many CFOs are worried about the future talent pipeline within their function. In a survey carried out for the report, 73% of respondents agree that very few people in their current finance organization have the broad skills required to succeed as Group CFO.
In our work with clients, we have found that there are several key approaches that companies need to take from a talent management perspective in order to address the human capital challenges that finance transformation raises. These are described in the full article.
The article also includes an interview with Adam Wiltshire, CFO for Gas Distribution at National Grid. Like many large companies, the international electricity and gas company National Grid has been focusing on ways to make its finance function more efficient and effective.
It’s our job to set clear expectations for people so that they understand that they can only build the necessary range of skills for a senior position if they have experience across the different activities.Adam Wiltshire
CFO, National Grid Gas Distribution
In practice, this has meant restructuring the finance function into three distinct areas: a business partnering team that serves as a strategic advisor to the lines of business; stewardship activities, which includes specialist functions such as tax, treasury and corporate finance; and a shared service center, of which a significant proportion has been offshored to India.
This three-pronged model for the finance function has been in place at National Grid for around five years, and one of the challenges has been ensuring that members of the finance team gain experience across the distinct functional areas, as well as in commercial roles in the business. “If I was recruiting someone today who was identified as a rising star, then I would want them to have spent time in each of the three functional areas, as well as gaining some direct experience in the business,” says Wiltshire.
By giving finance professionals exposure to a variety of functional and regional roles, and providing a clear career path that fits with the individual’s capabilities and strengths, companies will stand a much stronger chance of positioning their finance function for sustainable success.
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