Will companies decrease their finance and accounting staffs in response to automation-driven productivity gains? Or will they instead assign workers to activities that are more value-additive than the rote ones taken over by machines?
Many observers have suggested the latter is more likely. However, skeptics — accustomed to seeing companies seize almost any opportunity to cut costs — abound.
In a survey of 1,730 financial executives (96% of them from the United States or Canada), only 3% and 6% of U.S. and Canadian respondents, respectively, said they expect to pare their finance and accounting teams as a result of digital transformation.
More than half of the survey takers (59%, in the case of U.S. executives) said they will maintain their existing staff levels. What’s really eye-opening, though, is that 17% of U.S. executives and 22% of those in Canada said they anticipate actually expanding their finance and accounting staffs because of proliferating technology.
The findings surprised Christopher Westfall, vice president of content strategy for Financial Executives International, for which FERF serves as research affiliate.
“The answer we consistently got is that they can’t cut any more people,” says Westfall. “New automation is coming at such a clip that they need their people to oversee the automated tasks.”
Exacerbating the situation is the difficulty of finding people with skill sets suitable for such oversight. University finance and accounting programs, rather than helping students develop such skills, continue to “teach the same things they’ve been teaching for many years,” according to Westfall.
At the same time, the most highly skilled finance staffers are needed for other priorities. “As business demands change or rise due to digital transformation,” the survey report notes, “many financial executives now have the flexibility to put their best people on those projects.”
Despite all the changes, the median cost of employing internal finance and accounting staff — including salaries, bonuses, and benefits — held steady for a fourth consecutive year in 2017, at 2% of revenue for U.S. companies.
FERF and Robert Half have been producing the annual report, titled “Benchmarking Accounting and Finance Functions,” since 2010.