CIO: Succession in the Digital Age
In today’s rapidly changing digital world, how do you groom IT professionals in accounting firms? What should you look for in skills and leadership capabilities? These are challenging questions, but with the right mindsets, firms can leverage their technology to a greater competitive advantage.
The leadership requirement has not changed in the past 20 years, even though the toolsets and skill sets have changed exponentially. Therefore, mindset is critical in naming a successor and developing talent with a higher level of technology savvy.
CIOs must have competence in the following five areas in order to succeed in the accounting profession:
1. Leadership, vision and a strategic plan;
2. Financial and business savvy;
3. Talent development — HR;
4. Communications, marketing and sales; and,
5. Business processes.
You will quickly notice that technical skills are not at the top of the list. They are simply table stakes and great leaders identify and develop their team and successors. The accounting profession is a team sport and not for rugged individualists. The same holds for technology leaders. CIOs must be able to develop skills internally, as well as source skills externally.
Where do you find technology talent and how do you develop them into firm leaders? Mindset plays a significant role. Let’s first look at mindset and then at sources for technology talent.
First, technology is a strategic asset and not overhead. Technology should be planned, managed and executed as a strategic asset. Second, technology should focus on innovation-transformation and not just optimization of current processes and services. Finally, technology needs a seat at the management table in order to prioritize, plan and deliver the desired return on investment.
In many firms, service-line partners have given away much of the value created by technology through hourly billing and billing practices designed to protect a book of business. Mindset will also provide additional opportunities and ensure the firm’s future-readiness.
Technology talent is difficult to find and is becoming more expensive, and many firms have adopted the strategy of trying to do more with fewer technology resources. Some have outsourced, and frankly, together all of these strategies can be combined to provide progressive firms better technology and a competitive advantage. For a look at the pros and cons of technology resources, see the table below.
Types of tech talent
|Resource ||Pros ||Cons |
|Internal leadership ||Provides vision, trust and communication. ||Expensive, but worth it in today’s market; difficult to develop and retain under many firms’ existing compensation models. |
|Internally develop talent ||Learn and know the culture. May build trust. Develop skills for the future while optimizing existing IT infrastructure. ||Takes time — many years. Risk loss if opportunities are not available to advance. May not have access to all the required skills. |
|Bring talent from outside the profession || |
Hire experienced IT professionals.
|Lack of understanding and experience with core vendors. Expensive, and a highly competitive market. |
|Outsource ||Scale faster. Specific technical skills. ||Lack of vision and strategy. |
|Peers ||Understand the profession and are a good second opinion. ||Often not a priority and requires an investment of time. |
A combination of those resources seems to be the formula for success, with great leadership the differentiator. People, planning and processes are all required to ensure a return on your technology investments. It is much easier to attract and retain talent (technology included) with the following firm strategy and governance in place:
1. A technology leader with a seat at the management table.
2. An IT roadmap integrated with the firm’s vision and strategic plan. A technology task force can be an accelerator if leveraged properly.
3. A culture where IT is viewed and managed as a strategic asset, not overhead.
4. Access to external resources and peers with scheduled meetings.
5. Innovative projects and a rewarding career path.
Each firm is different in their timing, priorities and wants. Transformation is at the top of the freedom list — even above money, time and relationships.
Most CPAs want to remain successful and relevant, and technology is an integral part of firm and client success. Think — plan— grow!