During the pandemic, more so than in the distant past, we have seen how well management theory works ‘in the wild’. Andrew Harding, FCMA, CGMA, chief executive – management accounting at The Association of International Certified Professional Accountants, representing AICPA & CIMA, writes
As Covid took hold, I saw lots of articles speculating on how the way we work would change – see my own article for The Accountant on this from last year!
What our members have told us is that 2021 has seen the consolidation of changes which companies took after Covid first forced us to rethink our work; things like building technology networks which better support home working, rethinking supply chains, or offering more flexible working conditions.
My view is that these changes will be permanent, it has mitigated risks and built resilience. The longer this so-called ‘new way of working’ goes on, the more embedded it becomes, the more difficult it will be to return to how we used to do things.
As for what we will see in the next 12 months? I am hesitating about being too bullish for obvious reasons, but I think now that the fundamentals of how we work are broadly in place, the way we manage teams will change. Now we have been displaced from our offices, there will be a gradual evolution of people management rather than an overnight sea-change. I think – and hope – that we will see businesses start to look more seriously at building further resilience into their organisations and staff. That will start with the management of recruitment and continue into the area of operations.
Research and consultancy company Gartner believes that post-Covid, organisations’ recruitment should focus more on skills than on roles, which it says will boost resilience. For me resilience, both personal and organisational, is the most important non-technical professional quality. This makes sense when you consider how many organisations have had to either change their business model entirely, or at least accelerate changes which may have been in the wings.
At the Association for example, we sped up the introduction of ‘remote proctored’ exams to ensure our students’ learning did not lose momentum. We weathered that particular storm and found ourselves three years ahead of our plans for evolving exams.
Ability to pivot
That resilience, shown as an ability to pivot, is a key weapon to protect against obsolescence and it requires smart management. When employees have critical skills – such as in digital technologies – they are more agile, and it opens up options for them career-wise as they can move into a wider range of roles. It also makes the organisation more resilient.
As we know, measuring the right things and then using the data to inform your strategy are key. Committing to building a resilient organisation means you need to build a way of measuring resilient skills in your organisation, and where necessary supporting employees to add those to their skillset. Acquiring these skills could perhaps form part of your performance management programme.
There is another reason why we must up our management game for 2022: productivity. Business leaders are obsessed with maximising productivity – rightly so, because done correctly, higher productivity can improve not only the bottom line but our quality of life.
In a report we published at the end of 2021, we heard members blame poor management practices – among other things – for the UK’s productivity woes. It is in our grasp as management accountants to look seriously at this finding and make the case for evolving how we manage people and processes in our business. We have the tools and the expertise, plus in the current economic environment, we certainly have the incentives to review and reform what we can to improve productivity.
To help you, in a related report, Reimagining performance management, we produced a summary of best practices, recommended by members, to start the conversation. Here’s a selection of them:
Hold monthly functional resource group meetings between finance and HR leaders to discuss vacancies, opportunities, development needs, upcoming resignations and capability building;
Have regular quality conversations based on four key performance questions:
- How is my role significant to the business? How can it be?
- How am I doing?
- How can I improve?
- What’s my future?
Integrate risks from externalities into relevant performance management processes and classify risks from externalities as reputational risks. Incorporate material externalities into business values and expected behaviours. One area which we must take the lead in is setting environmental, social and governance performance measures and including these in management information so that boards are focused on this in their decision-making.
During one of my regular catch ups-with finance leaders, one indicated that at the moment, progress is more valued than perfection. As we continue to feel our way forward, I could not agree more.