Check out the interview about the Mind the gap survey as we give insight into what the market is considering when recruiting financial executives.
You can listen to this interview podcast here: http://bit.ly/2shgEjV

JESSICA HUBBARD: Today we’re chatting to Grant Robson and Richard Angus from The Finance Team. The Finance Team is a professional consultancy specialising in the provision of experienced financial executives on a part time, interim or project basis. Last year The Finance Team ran a survey entitled mind the gap, gaps in resourcing your finance department. We’re here with Grant and Richard to talk through the survey and see what we can learn from some of the key insights.

GRANT ROBSON: As you mentioned in your introduction, The Finance Team is a professional consultancy, we’re not really a recruitment company as such. We employ our own professionals who we then utilize in the market to provide an interim part-time financial executive solution. So we were very interested to go to the market and find out the elements that we believe are very important in terms of how companies go about making these selections.

There were only five basic questions, to ensure that we were on the right track in terms of our reading of what we think the market finds very important when it comes to placing top notch, experienced financial executives. So that was the rationale behind why we conducted the survey.

JESSICA HUBBARD: Where was this survey run and who were your respondents?

GRANT ROBSON: The survey was run in conjunction with Moneyweb. Moneyweb sent out a link to the survey in the Moneyweb Morning Coffee (recently rebranded as MoneywebNOW) newsletter and then we also conducted the survey at the Finance Indaba in October 2016, which I think drew about 5 000 financial professionals to the event and whoever wanted to come through and do the survey was more than welcome to come through. Readers and listeners of Moneyweb were also invited to come and complete the survey.

JESSICA HUBBARD: So let’s dive into some of the key findings that came out of it, anything particularly surprising or unexpected?

GRANT ROBSON: I think before we even go into the results it’s really important to just note that the majority of the respondents were from SME companies, so smaller companies with turnover of less than R500 million and less than 200 employees, so I think that’s a really important element. You can expect to get different results from larger companies and I think at a later stage we will do another survey targeted at those larger corporates. But for now, it’s mainly smaller companies that answered, there were different categories, which I’ll ask Richard to go through. And because it was open to a large range of individuals, we then limited the results of the survey to those who we believe are the ones who make the call in terms of who gets employed in the company. Richard, if you can just go through that quickly.

RICHARD ANGUS: In terms of those roles, we looked at the chief executive role, the chief financial officer, then also the group financial manager role because they’re often charged with filling holes in a bigger organisation and then also financial managers themselves, because they often have to plug gaps in their team or across associated people and other teams. Then we also had a very small percentage, as Grant indicated earlier, of human resource managers, we only had about 4% of them, just due to the nature of the survey and where it took place.

Interestingly, of the people who responded, 44% were in the chief executive officer role, so we are talking to people who are actually the key decision-makers. So we’re talking about the people who are actually making the calls for their own businesses and for that mid-corporate size – staff below 200 and turnover below R500 million.

JESSICA HUBBARD: What were the five questions that you were asking?

GRANT ROBSON: Let’s go through the five questions and we can do a bit of commentary on each one as we go through them. The first question was:

On average, how long does it take to fill a vacancy in your finance department?
The majority of respondents, close to 70%, suggested that it’s less than 60 days. That wouldn’t be very surprising from a smaller SME company, so if you look at that result and you look at the larger corporates it’s actually more than 60 days. So a very straightforward question and the basic answer to that is the larger the organisation the longer it tends to take to employ good financial people.

JESSICA HUBBARD: Which is intuitive, you would have expected that.

RICHARD ANGUS: If we look at question two:

Do you have an HR department that you delegate the sourcing of candidates to?
That had a surprising response because we actually didn’t expect this, 60% of the respondents said yes, they have an HR department. We actually thought that in the world of 60/40 that probably only 40% would say they have HR departments, 60% actually have the skillset inside their companies. We believe that’s driven fundamentally by two elements, the first is the complexity of the legislative framework in terms of employment law, processes and so on, so compliance is obviously important. Then the reality is that companies are also moving in nature, we’re moving away from manufacturing and heavy industry into more service oriented and technology-oriented environments and that is more people-intensive, so people are now becoming more significant in the world of an entity and a company. The chances are that they are going to spend more time employing people than they are making capital investment decisions in bulk equipment or something like that. So HR is increasing in its stature and importance in the company.

JESSICA HUBBARD: It shows that people are finally placing value on their staff.

RICHARD ANGUS: It’s the age-old story that your people are the most important asset.

GRANT ROBSON: We certainly see it, we effectively employ our own associates at The Finance Team and without good people we just don’t have a business, we don’t have people out there representing the brand correctly and providing a great service. Probably 40% of our time that we spend on a daily basis is going into evaluating who we are going to bring on board to represent our brand and I don’t think there’s any other great company out there that doesn’t think the same way.

JESSICA HUBBARD: Let’s move onto the third question:

When sourcing candidates for vacant finance roles, what is the best source of candidates?
This is a fascinating question.

GRANT ROBSON: It is, the majority of respondents, close to 36%, still go through placement agencies, which is not surprising. In fact, we would have actually expected that to be a higher number, so 36% for us was a bit on the low side.

What we did find quite interesting is we look at internal applicants (19%), direct applications on an unsolicited basis (19%), responses for adverts on traditional media and job sites (17%) and then responses to adverts on social media (9%) – if we had done the same survey five years ago, that might have been 1% and it’s gone up to 9%, 10% now.

So there’s no doubt that companies, HR professionals are plugging into social media sites like LinkedIn, Facebook and other media that’s out there and that’s really becoming a good source for companies.
What I personally find interesting, and people out there who might be listening and interested in approaching a company that they want to work for, 19% was direct external applications on an unsolicited basis. That’s people who have taken the time to write an email to the HR department or the head of HR or the CEO or the CFO to say: I really like your business, this is who I am and can I have a shot. Twenty percent of placements are being made in that way, which I find quite fascinating.

JESSICA HUBBARD: Yes, I suppose it also shows you are proactive and hungry if you do that.

GRANT ROBSON: It does and I think that’s one of the tick boxes that you want to tick when you take people on board.

JESSICA HUBBARD: How do you see the social media element playing out in the coming years, is this going to be a very prominent element in recruiting going forward?

GRANT ROBSON: Absolutely, I think if you look at the traditional recruitment companies that are out there, a lot of them are taking strain because this element is becoming much more of a player in the market. So this cutting out the middle man, if you want to call it that, through the likes of LinkedIn and other social media is definitely having a huge impact on recruitment companies out there. It can only get bigger and bigger, I think if we look again in another two or three years it will probably be closer to 20%. It does tell an interesting story as to where this industry is going.

JESSICA HUBBARD: Let’s look at question four, which is very revealing for me:

What are your three most important considerations when recruiting financial staff?
RICHARD ANGUS: I think it goes without saying that those elements of candidate experience, qualifications and the ability to evaluate somebody’s track record are critical elements and those came out on the forefront of that.

Interestingly, we had planted one category into this survey that we were very interested to understand, given the context of South Africa, and that was the question of a candidate’s employment equity profile and that continues to be topical. There have been recent comments about whether employment equity is actually reaching traction. When you look at the results overall, we actually see that profile only being critical at a 9% level when you look across the survey, which we initially were extremely worried about and we thought that told us a story about where people see that. If you compare that against Canada, experience and qualifications are at 23% and 18% respectively, then the 9% for employment equity [in South Africa] is fairly low. However, we then dissected the data a little bit and we looked at companies over the 200 staff level and at that point two elements emerged immediately – cultural fit with 19% and employment equity status at 15% were the two most important categories and they were selected every single time by the respondents in that category.

JESSICA HUBBARD: Was the cultural fit something that surprised you?

RICHARD ANGUS: Not at all because as the organisation gets bigger, making sure you have cultural fit in a large organisation is a critical part of performance but what it does talk to is the fact that cultural fit drives connection and values within an organisation but employment equity status is critical for larger companies. If you look at the BBBEE codes in terms of when employment equity becomes relevant in an organisation, I think these results now mirror those elements quite nicely. If somebody were to say to me, is employment equity important in the workplace, the answer is absolutely yes. You can see in the survey that companies with more than 200 staff members are actively seeing it as one of the most critical parts of their valuation criteria. The fact that it and cultural fit are so close together, tells you that it’s almost as important for them to say what is your employment equity profile and will you actually fit well in my organisation. I was quite surprised by that it does tell a very positive story and obviously the track record on the ground is what counts but this definitely talks to intent that people do consider this very strongly.

GRANT ROBSON: If I can just add another point there, if you look at these larger companies the employment equity status choice and it was the first choice of all the respondents, so it just shows you, as we’ve just said, as there are question marks around the importance of employment equity, in these larger companies it’s the most important criteria.

JESSICA HUBBARD: It’s key insight for companies looking ahead. Let’s move onto the final question:

Whilst recruiting for financial staff, how do you mind the gap in the interim?
Can we perhaps talk to businesses of all sizes, so SMEs and larger corporates?

GRANT ROBSON: The overwhelming winner on this one was relying on existing staff to cover the critical issues that arise. These last two questions were probably the most important for us because this is really in the area that we play in, we provide part time and interim executives. So we were very keen to see that when this gap arises what are people currently doing, so 50% are just relying on existing staff. Now, how sustainable is that? You’re going to put these people under a huge amount of pressure, what happens to the quality of the information when you do these sorts of things, so there’s a lot to read into that. We then had the response of second a staff member from somewhere else in the organisation at 13%, and then source a contractor from a recruitment or personnel agency was around 16% and only 8% said they would come to a company like us, so we’re going to have to change…

JESSICA HUBBARD: Lots of marketing to do [laughing].

GRANT ROBSON: We’re going to have to change that perception. The other response of leave the work until a new person is appointed I’m happy to say was only at around 4%, so not a lot of people are doing that, thank goodness. Then at 9%, which is quite high, is source a suitable qualified candidate from an audit firm. Again, bearing in mind that these are smaller companies. With larger corporates, you’re not going to find the use of audit firms helping out internally and at executive levels, in fact there was not one answer that would use an audit practice and really because the Companies Act doesn’t allow for that.

RICHARD ANGUS: I think for me, the one thing that’s very clear from this whole survey is the fact that the selection of the people in your business is a critical success factor and you can see here that CEOs are responding but you also worry when you see that 50% of the work is effectively just going to be passed to the existing staff. It sometimes worries one that the whole expectation gap of how people expect work to happen actually exists in organisations, so CEOs and people at that sort of level think the work is going to happen and they don’t really, and there seems to be a little bit of a disconnect with what actually happens on the ground and the gaps that potentially need to be filled.

For me that’s the one element why our business is important is to enable people to get the work done, to focus on the output and make sure that there’s execution and delivery with experienced people who aren’t going to take six months to get up the curve and so on. If you look at those elements, candidate experience was the highest consideration in the elements of what you would consider the most, 23% of people said I want somebody with experience and that means there’s no time for training. When you’re plugging the hole you want experienced competent people who can step in, fill the gap and from what I can see we want to be able to do that at lower levels in the organisation without the boss knowing that we’re just filling the gap and getting it done. So that was an insight for me.

JESSICA HUBBARD: Certainly very important insights for HR professionals and business leaders across the board. That was Grant Robson and Richard Angus from The Finance Team.

RICHARD ANGUS: Thanks for having us and a big thanks to Moneyweb for collaborating with The Finance Team on the survey.

“Time flies over us, but leaves its shadow behind.” – Nathaniel Hawthorne

The American author’s words have a universal gravitas to them. How often do you hear the refrain: “This year has just flown by!”

In a lot of ways, time seems to move more quickly today than it did 100 years ago. That’s based not on the clock hand making its circuit more rapidly, but on the fact that we are expected to get more done.

The tools at our disposal mean we complete more projects more quickly and accurately. We cover more distance and communicate with more people. At the same time our days are more frantic and more filled: we are under pressure to “achieve” more at the end of every day.

But the same tools that increase our productivity can also chisel away at it. Before you know it, you’ve spent 30 minutes time-wasting on social media. Or, you’ve had a two hour whatsapp conversation that could have taken half the time if you’d just picked up the phone and called the person.

With that unique modern ambiguity in mind, here are five tips that can ensure finance professionals they’re using their moments productively.

Finance professional time-saver tip 1: Start working within five minutes of turning on your computer. It’s amazing how quickly time can get away from you when you’re ‘settling down’. Clicking on that youtube link your colleague sent you could lead to spending 45 minutes watching ‘hilarious dog videos’. Or, your morning trip to the office coffee area could result in a lengthy gossip session with a colleague.

Finance professional time-saver tip 2: Create an ‘turn off’ period: Every day (if possible) create a block of time when you go ‘off the grid’. During this time, close your email and switch off your cell phone. Watch your productivity soar!

Finance professional time-saver tip 3: Conduct a ‘time audit’ for one week. As a finance professional, auditing should be right up your alley. Spend a week keeping track of where your time is going. Pinpoint where you’re spending time on a regular day. Notice where you’re spending time over the weekend. Adjust your schedule accordingly.

Finance professional time-saver tip 4: Apply the 50% rule. Jo Mathews writes in the Entrepreneur magazine: “Plan to spend at least 50% of your time engaged in the thoughts, activities and conversations that produce most of your results.” So, take some time out at the beginning of your day to decipher where your big ‘returns’ will be. Plan your time accordingly.

Finance professional time-saver tip 5: Mini-breaks. Yes, we’re suggesting that in order to save time during the day, you must ensure that you take enough breaks. A mindful five- or ten-minute break every 90 minutes will keep you focused and productive for longer than a several-hour slog.

And if you’re despairing of the fact that there simply aren’t enough hours in a finance professional’s day, we’d like to pass on some sage advice.

“The good news is that real time is mental. It exists between your ears,” says Mathews. “You create it. Anything you create, you can manage. It’s time to remove any self-sabotage or self-limitation you have around ‘not having enough time,’ or today not being ‘the right time’ to start a business or manage your current business properly.

“There are only three ways to spend time: thoughts, conversations and actions,” says Mathews. “While you cannot eliminate interruptions, you do get a say on how much time you will spend on them and how much time you will spend on the thoughts, conversations and actions that will lead you to success.”

What would you do in your business if you had more time?

It’s a thought that business owners daydream about. Many business owners have, in their quest to create more time for themselves, been lured by the idea of outsourcing. The Businessdictionary.com defines outsourcing in the following way:

“The contracting or sub-contracting of noncore activities to free up cash, personnel, time and facilities for activities in which a company holds a competitive advantage.”

What is the most productive way in which you and your staff members could be spending their time, if they didn’t have to spend an obligatory portion doing admin and other non-core activities? Would you be selling, strategizing, chasing a growth target?

If you have answers to any of these questions, then you might consider outsourcing finance in your company. Doing so could save (or earn) you money.

“Companies having strengths in other areas may contract out [certain aspects] of their business to concentrate on what they do best and thus reduce average unit cost”, says businessdictionary.com.

The outsourcing sector is becoming more and more prolific. At the same time, it is becoming more complex than ever before. According to globalizationx.com, several factors are playing into this. They include globalization, the consolidation of companies, supply chains and functions, and conversely, the diversification of various industries.

“Traditional outsourcing models are crumbling more quickly than we could have anticipated,” says globalisationx. Gone are the days of appointing a large, disconnected and separate institution to fulfill in-house accounting duties. Instead, companies are outsourcing finance to niche finance houses which specialize in responding to particular financial needs. The overall trends of outsourcing finance are also evolving at the same time. Some of the current outsourcing trends, according to globalisationx, are as follows:

The Managed services model: This model is one popular way of outsourcing finance. The outsourced service is managed and monitored by an external source, or alternately by a manager in-house. This approach allows the alignment of business strategies with the goal of the outsourced service. “As firms mature their outsourcing strategies, they are evolving their relationships with service providers beyond the traditional client-vendor relationship to that of a business partnership,” says globalisationx.

And the way in which the success of the outsourcing finance partnership is measured has changed as well. “Effectiveness of sourcing relationships is now increasingly measured by its impact on overall business related outcomes and not just on cost or efficiency improvements.” In other words, how strong is the relationship that binds the company with its outsource partner? How does the relationship help the company to achieve its overall strategy?

Nearshore rather than offshore: Another rising trend in outsourcing finance and other services is to keep it local. Where certain services (think call centre type roles, for example) have typically been farmed out to far-off locations, these are now increasingly being handled by local sourcing partners. The local input gives the company a more authentic feel, and locals have an appreciation for nationally-specific nuances and sensitivities. In the case of outsourcing finance, this is made even more relevant by the need to understand local tax and accounting laws that will affect the planning and operations of the business.

One outsourcing finance solution that is on point with both of these trends comes from The Finance Team. The company has a large network of locally qualified and experienced finance professionals, who are trained to assess and assist your business’s outsourcing finance needs. If your company needs particular financial assistance, The Finance Team can provide it on an ad hoc or temporary basis, according to your requirements.

At the start of a project, ideas are fresh and everyone is excited and focused. As time wears on though, reality sets in. Timelines start to expand beyond what they were initially anticipated. The scope of the project starts to creep wider and wider. And at the same time, the budget starts to expand.

As the person overseeing project accounting, you don’t have overall responsibility for the assignment being a success or failure. However, you do have a responsibility to make sure that the project accounting side of things runs smoothly and efficiently. And that, any project accountant will attest, will in many ways be a large contributor to the overall success of the endeavour.

Unfortunately, project accounting, just like any other part of the project, is prone to errors. Being aware of some of the potential pitfalls before you begin, and how to overcome them, will help you to ensure you don’t fall prey to some of them.

1. Lacking clear focus to your measurement.

The role of project accounting is to plan, measure and control the company’s expenditure on the project. Unless you have a very clear idea of the desired outcomes of the project offhand, it could be easy to identify measurement matrices that are inappropriate.

Curt Finch writes the following for Journyx: “So maybe you have done your research and have determined the key performance indicators you will be using for your project and their desired outcome. But how do you know that you’ve implemented the correct KPIs to begin with? If you were planning a … road trip across country, you wouldn’t use a map that focuses on local points of interest in one particular region. Why? Because it would be too specific and too narrow in focus to be of practical benefit.”

Make sure that you get a clear indication of where the project is headed before you outline your systems of measurement in order to ensure the practical benefit comes through.

2. Getting greedy for data.

Once you’ve worked with the project manager to identify key performance indicators, you’re better placed to decide on which data sets to use for measurement. The key here is to choose your most powerful weapon. Trying to collect too much data will overwhelm and frustrate other employees. Even though it would be great to have details on every part of the project, other project users won’t feel the same. The more info you ask of them, the more they are likely to make mistakes or abandon the tracking tool. Ultimately it will lead to error-ridden data. Finch says:

“Focus on efficient reporting. You will need ample information to track the project’s progress, but try not to create a system that focuses on acquiring every possible scrap of data, to the point that it bogs your employees – and your project – down. Decide what you need to track, and design the system to collect that information as succinctly as possible.”

Finch suggests five useful data sets to consider:

• Billability
• Adherence to estimate
• Percentage of projects that are profitable
• Available resources
• Scope of milestones within timeline

3. Failing to back up your accounting software.

The world of project accounting is made up of accountants. We don’t think like IT people. But sometimes we ought to.

Failure to do so could lead to a project accounting horror story like this: You’ve sweated blood and tears your whole way through a project. You’ve tracked, measured and reported faithfully throughout. In the last week of the project, just as you are pulling all your information together to generate your final reports for the Exco, there is a glitch on the system and all your information is lost. You hadn’t thought to back up your systems since the project began. (If this sounds unbelievable, start asking your project accounting peers if something like this has ever happened to them!)

From the outset, work closely with IT when setting up your systems to understand when and where information will be saved and backed up.

Determining your project focus, streamlining your data sets and making initial plans to back up all your information can help you avoid a few grim project accounting errors. If you could do with some assistance in the field of project accounting, contact The Finance Team. Our experienced team of finance professionals will assist your company for the period of time you need them and no more.