Industry 4.0 And The Consequences For Accounting & Finance Part V: What Can You Do About it?
Written by Andrew Codd on February 9, 2018
The opportunity for those in finance careers to be full of fun, meaning and contribution has never been greater, yet in the same breath we have all this digital disruption being caused around us by the fourth industrial revolution.
And so to the final part of our Industry 4.0 series and thinking about ‘how we should respond’ there is an important lesson from earlier industrial revolutions we can build and move on from:
“the extent to which societies & businesses embrace technological innovation is a major determinant of how they will progress.”
A numbers example
Compare for example Detroit, USA in 1990 (then a major centre of traditional industries) with Silicon Valley today. In 1990, the three biggest companies in Detroit had a combined market capitalization of $36 billion, revenues of $250 billion, and 1.2 million employees.
25 years later, the three biggest companies in Silicon Valley had a considerably higher market capitalization of $1.7 trillion (50x larger); generated roughly the same revenues ($ 329 billion), but with about 6 times fewer employees (205,000).
Nuts eh? The result being that these traditional companies are no longer as highly valued nor as relevant as they once were, whereas the Silicon Valley companies show us that we should embrace digital platforms and what these can positively do for our profession, the decline in the Detroit companies signal to us what not to do: ignoring changing consumer tastes and preferences as well as failing to innovate by disregarding what’s no longer relevant and figuring out what works best in serving customers in a more sustainable way.
How to remain relevant
I estimate there 5+ million qualified and student accountants across the world, we’ve grown because it’s a testament to our profession continually developing. But like the difference between Detroit and Silicon Valley we need to embrace new platforms, technological innovations, better ways to doing things to continue to develop our knowledge, add value and make a positive impact to our organisations & stakeholders so that we continue to remain relevant. Ask yourself when you finish you work today:
- Have you set aside time this week to develop your knowledge around these new technologies & platforms?
- Have you checked in with managers & stakeholders that you are adding value to them and positively impacting them so that you continue to remain relevant?
- Who do I know or need to know who can help me figure out what I need to be doing?
It’s particularly the last question we’re trying to help answer by creating the Strength in the Numbers Show to provide ‘the who’ via videos, podcasts, blogs and quality resources like well-linked show notes, forums, and training tools so you can start building your strategies on how to respond to and chart a course through the impacts of Industry 4.0 for your careers and your organisations.
The future view of Finance
If we get it right I like to picture and think that accounting & finance is at the core of these organisations whilst also being one of the few functions to also get the privilege to see that fuller picture of what’s going on from a commercial & financial viewpoint across our whole business. And because of that level of insight we also get opportunities to influence business leaders on where the company is moving forward and on where we can make a meaningful contribution, this excites me. And similarly I also believe our Strength in the Numbers Show can provide a vantage point from where we can assess how best to leverage our traditional strengths in compliance and controllership to continue to remain relevant to our organisations, by helping them overcome the challenges of today and also make the most of the opportunities available now so that they are more successful tomorrow because we have been successful in adding value to them and are thinking about how to best continue doing so into the future.
The reality of the disruptions we’ve been discussing these past few weeks is the inevitability of the impact it will have on us and how we can’t expect and wait for our schools, accounting bodies, governments, & businesses to do something about it because the fact is that we are not powerless to act ourselves in the face of it, we can choose to do something about it ourselves. We can figure out a vision of the future where accounting & finance comprises a profession where people wanting to have fun, rewarding and successful careers can access the necessary practical and technical skills to do so, so that they can also make a meaningful contribution to their employing organisations and communities. It’s about uniting around our strength in the numbers and the value we can add to our organisations so that we continue to keep up with and continue to add to our strength in numbers into the future.
So What else can you do?
In this series of articles I’ve tried to balance for what I’m seeing, hearing and sensing out there so that you can make more informed choices, that is, help you to better understand and know what to do, how to do it, what skills, abilities & knowledge to develop to remain relevant, so that you and the rest of our community can have fun, rewarding and meaningful careers that becoming an accountant or finance professional should stand for.