Collins | Transitioning To Tomorrow’s Workforce

One of my first bosses was fond of saying: “Whatever it was that got you here won’t be enough to keep you here.” He was talking about the nature of competition; that another company was always working to offer new products to lure away the customers we had worked so hard to acquire.

The same phrase can also be used to describe the nature of business operations. Certainly, no company relying on a quill pen-wielding clerk tracking accounts in a bound paper ledger can expect to compete with today’s digital businesses.

Current developments including ATSC 3.0, demand for personalized advertising experiences and the move to cloud-based management solutions mean that media company personnel have changing responsibilities. These are all examples of what it is being called the “Fourth Industrial Revolution” which is reshaping businesses, commerce and culture across the globe.

Last week I joined MFM members and guests for an MFM Localism event at Turner’s Atlanta offices to hear about the “Finance Workforce of the Future.” Scott Moyer, managing director at PwC, used the firm’s “Workforce of the Future” report as the basis for his remarks.

Automated And Digitized Business Operations

As Moyer noted in his presentation, the finance function, like most others, is becoming increasingly digitized. When this occurs, functions such as planning, operations, business transactions, financial reporting, and performance analysis require dramatic shifts in employee headcounts and skills.

Using a series of charts, Moyer illustrated how he expects today’s workforce pyramid to be completely inverted in the future. For example, most employees in finance department have traditionally held jobs related to transaction processing, such as billing and accounts receivable. From a headcount perspective, this category has represented the base of an organization structure.

As with other departments, many of these manual accounting tasks are becoming automated. For example, one of my former colleagues, someone I also caught up with while I was in Atlanta, mentioned that software has made the manual tracking of music clips used in live sports telecasts a thing of the past.

Finance jobs in the middle tier of the pyramid are devoted to compliance functions, such as SEC and tax filings. The smallest number of finance jobs in today’s workforce, representing the top portion of the pyramid, are engaged in activities requiring insight and action.

PwC says the opposite will be true for tomorrow’s workforce. Employees engaged in transaction processing will represent the smallest percentage of the finance workforce. Conversely, the number of jobs involved in providing insight and action will swell to represent the largest portion.

Workforce Trends

Moyer see some drastic changes resulting from this inversion process. They include the elimination of jobs that have been offshored and a workforce reduction of as much as 75% for transaction-processing jobs.

We are already beginning to experience some of this shift. Trends Moyer cited in his presentation include:

• 40% of the workforce is not employed in traditional fulltime 9 to 5 jobs.
• 85% of the new jobs created between 2007 and 2017 were alternative or non-traditional.
• There were 91 million 1099-MISC tax forms issued by the IRS in 2016, reflecting the growing use of independent contractors.
• Companies experience a 30% savings in their payroll costs when they hire freelancers.
• A 34% rise in on-demand workers such as Uber drivers, Instacart delivery and TaskRabbit.
• By 2025, 35% of the next-generation finance and accounting workforce will not hold traditional finance and accounting degrees.

Not So Fast

However, many finance chiefs report they do not anticipate reducing their current staff levels this drastically. A recent article in CFO Magazine cites research that suggests automation won’t necessarily reduce finance staffs.

The study, based on a survey of 1,730 financial executives, found only 3% of U.S. respondents, respectively, said they expect to pare their finance and accounting teams. More than half of the U.S. survey takers (59%) said they would maintain their existing staff levels, and 17% said they anticipate expanding their finance and accounting staffs to address digital transformation requirements.

One area on which both the CFO Magazine survey and PwC’s research agrees is the need for employees with transformational expertise. Workforce experts report that traditional university programs aren’t delivering finance employees who have the “skills sets suitable” for oversight in the digital age. Instead, as Christopher Westfall, VP of content strategy for Financial Executives International observes, they continue to “teach the same things they’ve been teaching for many years.”

A Greater Role For RPA

As they migrate to the ATSC 3.0 broadcast standard, TV stations represent a microcosm of the workforce shifts that are taking place within station groups and media organizations. Competing effectively as a multichannel, multiplatform and revenue-diverse organization increasingly relies upon technology-driven solutions such as cloud-based management, blockchain and automation.

Experts also predict more universal deployment of RPA — robotic process automation. PwC’s Moyer says one application will involve “intelligent process automation,” which combines RPA with artificial intelligence, BPM (business process management) and analytic technologies “to identify patterns, learn over time and optimize workflows.”

Rohit Rathore, CEO of RiteSys Automation, has been working with media organizations on implementing automation systems such as RPA for their business operations and IT functions. He provides a good overview of RPA’s potential role in a viewpoint piece he prepared for MFM’s member magazine, The Financial Manager (TFM).

Echoing PwC’s finding on the workforce impact of automation, Rathore reports “RPA has the potential to yield an 80% cost reduction, a 90% increase in productivity and 100% accuracy. A single software bot may cost around 10% of what a company pays for the annual salary of a person that could handle the same tasks.”

However, to date, not all organizations have achieved these anticipated results. Rathore says: “The problems have related to a lack of planning, diluted executive sponsorship and absence of operations discipline during the implementation of RPA.”

His article, which appears in TFM’s September/October 2018 issue, goes on to provide some helpful tips on how to overcome these obstacles. A copy of the magazine will be available for viewing on the MFM website for a few more weeks before it is moved into the “members only” archives.

Examining The Broader Applications

While much of the focus of Moyer’s presentation to the Atlanta group was focused on the finance workforce of the future, digital transformation is changing staffing and skills requirements for every department and business function. As PwC’s “Workforce of the Future” report observes, “automation and ‘thinking machines’ are replacing human tasks, changing the skills that organizations are looking for in their people.”

How to address these workforce challenges and opportunities will be a big topic for the industry’s senior finance executives when they gather for MFM’s CFO Summit, March 7-8 in Fort Lauderdale, Fla. It is also likely to represent a subject explored in numerous sessions at MFM’s Media Finance Focus 2019 conference in New Orleans next May.

As we know from history, industrial revolutions aren’t limited to commerce. They affect many facets of a consumer-driven economy. As you begin to anticipate and address these changes in your organization, please let us know how MFM can help you respond in a manner that prepares you for the disruption.

PwC’s Moyer predicts that future business and finance teams will add value through planning and analysis. MFM’s mission includes providing its members with the education and resources to become more valuable employees.

Mary M. Collins is president and CEO of the Media Financial Management Association and its BCCA subsidiary, the media industry’s credit association. She can be reached at [email protected] and via the association’s LinkedIn, Twitter or Facebook sites.