Fall is just around the corner, and as a chief financial officer, it’s not too soon to start thinking about the challenges your business will face in 2016.
Today’s business world is moving at light speed, and maintaining the status quo is no longer enough to compete. Old viewpoints and strategies are often not enough to handle new threats or to capitalize on new opportunities. If you find yourself saying, “But we’ve always done it this way,” you might need to examine your business practices with a fresh eye. I think it’s essential to build a nimble team with members who have the knowledge and experience to respond to this new environment. For many CFO’s building that team will be your single largest issue in 2016.
Of course, the historic responsibilities of a CFO remain, but with new challenges. You will manage regulatory risk, as always, but with an eye to increased scrutiny of your organization’s employment practices, privacy and security, third party vendor management and federal, state and local tax regulations, to name a few. Maintaining compliance in the face of ever increasing complexity has direct implications to your bottom line and highlights the importance of building a knowledgeable team to manage these risks.
You’ll also be asked to identify and address newly emerging risks associated with information technology and cybersecurity. I know you don’t have unlimited funds to protect your data, so a risk assessment becomes critical to identify the most important, and perhaps most vulnerable, areas of your organization. Once you know where to allocate your resources, adjusting your budget becomes much easier. You may also find that your 2015 budget is simply not large enough to adequately address new threats, especially if you are adding services, outsourcing data or data analysis, or allowing greater flexibility with mobile devices and access to your network. Your risk increases with each of these business decisions, and you must budget appropriately to minimize it.
The HORNE team has written several blogs recently that discuss IT and cybersecurity topics in much greater detail, so I won’t go into the specifics here. Instead, I want to discuss what I think will be your greatest challenge in the coming year – building and retaining a high-performing team.
You can’t do this job alone. You must identify, recruit and hire talented employees. And you have to keep them. The good news is that they are available; the talent pool is deep. The bad news is that the incentives that attracted young baby boomers to your business are not necessarily the incentives that will attract and retain the generations that follow. The employees of the future will work differently than those of the past.
The Millennials, adults between the ages of 18 and 34, may be the most surveyed population cohort ever. They are certainly the largest. This year, they will become a majority of both the workforce and the population in the U.S. They are the future of your business.
What they’ve revealed in all the surveys they’ve taken is a desire for a good salary in a job that allows a balance between their work and personal lives. They don’t necessarily rate traditional salary and benefits as their primary motivation for staying in a job, and want their work to matter in the larger world. They value flexibility in their schedules and work environments, and are comfortable using new technologies to work from home or on a variety of connected devices. They also value opportunities to develop their skills and participate in management decisions.
I know several businesses that have been slow to allow employees to work from home or to access the company network remotely, even thought they’ve had the technology for years. Others are hesitant to allow employees to use their own devices to connect remotely. Although I understand the impulse to protect the network and manage teams face-to-face, I don’t think those strategies will serve your organization well in the long run.
Finding talented people with the right skills, only to lose them to a competing organization, is frustrating and expensive. If your organization doesn’t support flexibility and balance, your job for 2016 may be to work on your culture or to meet increasing demands with fewer staff members as your employees leave for better offers. Culture change is a delicate process, but you may find that the Boomers and GenX workers on your team may enjoy the same flexibility that the Millennials prefer.
Establishing new expectations and judging performance on new criteria can be done, and done well, and I would suggest that both are critical to attracting and retaining the talent you need to accomplish your goals. The pace of change and ever increasing complexity are leading many middle market companies to outsource certain functions to third parties. Whether on an interim or long-term basis, HORNE has the depth and expertise that can strengthen your team, and can work with you for as long as you need us. You only pay for the services you need, whether that’s assisting you in assessing and prioritizing risk, a quick answer from our research team, assistance with your regulatory compliance, or a temporary internal audit team.
Whatever your immediate needs are, however, I hope you’ll spend some time as 2016 approaches thinking about building a robust, energetic, and knowledgeable team. I believe it’s vital to your success.
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