2020 has proven to be a milestone year so far, for a vast variety of reasons. How will management accounting fare this year?
The world is changing faster than we realize, shaped by the twin forces of economic vagaries and technological movements. Aside from manufacturing, accounting and finance will also see much change. Functions, roles, and responsibilities will no longer remain as we knew them, and management accountants have to look ahead and buckle up.
It is more than apparent that professionals in this space must upskill and boost their competencies for what lies ahead. Here are suggestions on what they could do in four key areas:
Coming Of Age
The flood of competition, dynamic customer expectations and technological movements, and regulatory disruptions have meant that even successful companies cannot sit still. The year requires management accountants to serve as business partners and strategic advisors. “By earning a seat at the table, management accountants can enable their CEO and cross-functional partners to address current and future challenges and disruptions head-on,” says J Stephen McNally, CMA, CPA, CFO of the PTI Family of Companies, a global leader in sustainable packaging innovation.
Strategizing And Taking Decisions
Current and past on-the-job duties could soon be obliterated by the onward march of automation. Aside from a need to master data analytics and technology, there will be a requirement to extend a contribution in other important areas, such as partnering the leadership team or playing a role in decision-making and strategy. World events are a key force in this move, and management accountants must get a sense of potential risks facing the business, looking to manage risks and thereby facilitating strategic decisions. “With so many global and national uncertainties, such as unresolved trade deals, and our presidential election, advance planning for potential changes is critical,” feels Cate Long, CMA, former VP at a global software firm and an executive advisor to startups.
This will of course mean that the management accountant must become better at financial forecasting too. Economic uncertainty and market volatility have made it imperative for management accountants to be on top of the emerging trends that shape industries and the profession as a whole. “By shifting focus toward the future instead of the past, modeling various scenarios and financial impacts of the developments we observe in our business, and proactively communicating the findings to our stakeholders in a simple and actionable way, we as finance professionals can facilitate more agile decision making and create a competitive advantage for our organizations,” says Olya Kovnatska, CMA, financial planning and analysis manager at United Rentals, Inc., the largest equipment rental company in the world.
Adapting To The Global Economy
Global borders have ceased to exist – or are at least no more etched in stone. Businesses operate across borders in 2020, and management accountants must be able to do the same. According to Esteban Quiros, CMA, global FP&A manager for Procter & Gamble, “As more companies grow and operate across countries, it is essential to have the capability to operate effectively on a global landscape.” What this will require is mastering critical fiscal and compliance requirements, operating differences and market dynamics.
Working With Data And Technology
Technology remains the biggest force shaping business, and thereby, the management accounting profession. With repetitive, transactional tasks increasingly falling to automation, there will be a wealth of data mined through big data and machine learning, which Quiros feels could be a great source of analysis and insights.
Data has been gathered for years now, but the skill of mining it and using it successfully and productively is of prime importance now. The growth in the data analytics domain will definitely have an impact on management accountants. According to Fatema El-Wakeel, CMA, finance business partner for data analytics at Jaguar Land Rover, “Technology has enabled management accountants to deliver on-the-the job more efficiently and effectively, which will be needed for [the profession] to advance in 2020.”
There is no escaping the forces of market movements, and the management accountant must adapt to tasks beyond just watching over the books of the company. Outlooks must become global, and he or she needs to adapt quickly to the fast-paced dynamics of business, along with working across functions.
