Closing the Gap: How to Beat the Competency Crisis in Accounting

The CPA profession is facing a “competency crisis” that leaves most young professionals largely unprepared to meet the challenges posed by a changing and complex world.
A number of recent reports have hinted at this emerging crisis, citing a significant gap between the skills young professionals need to succeed and those they actually possess. The reports also have suggested some possible solutions and uncovered a number of opportunities for educators, employers, and employees themselves to improve the “workforce readiness” of today’s CPA.
The most recent of these reports was compiled by the Maryland Association of CPAs and the Business Learning Institute. As part of a strategy session facilitated by the MACPA and the BLI, the managing partners of 14 local, regional, and national CPA firms ranked what they believe are the most important skills for entry-level staff members.

They chose the following:
1. Communication
2. Writing skills / memos
3. Critical and strategic thinking
4. Advanced Excel skills
5. Time management / organization
6. Prioritization
7. Collaboration

Competencies for Accounting and Finance Professionals – 2016 Edition from Tom Hood, CPA,CITP,CGMA

That list mirrors the results of a number of other recent reports, all of which point to a widening skills gap that leaves both young professionals and their employers scrambling to stay relevant amid today’s massive change and complexity.
— A report by the American Productivity and Quality Center, produced in conjunction with the Institute of Management Accountants, found that the most critical non-technical skills needed by young professionals today are ethics, communication, customer service, adaptability, strategic thinking / execution, process improvement, leadership, and collaboration.
— In a May 19, 2015 article titled “The Plain-Vanilla Accountant Goes Out of Style,” Wall Street Journal reporter Kimberly Johnson writes that “leadership, forecasting, strategic thinking, cost management, and financial reporting are the skills where the gaps between demand and supply are the widest.” Citing the APQC / IMA report, Johnson adds, “(Eighty-one) percent of those polled said planning, budgeting and forecasting skills were ‘quite a bit’ or ‘extremely’ necessary for their organization to succeed. Yet the same respondents said only 30 percent of entry-level finance professionals possess those skills. Though 77 percent agreed that leadership ability was a necessity, only 14 percent said their employees had it.”
— Development Dimensions International’s and The Conference Board’s Global Leadership Forecast for 2014-15 outlined the top four skills that leaders must possess to succeed in a world defined volatility, uncertainty, complexity, and ambiguity. Those skills are managing and introducing change, building consensus and commitment, inspiring others toward a challenging future vision, and leading across generations.
— During the 2015 AICPA E.D.G.E. Conference for young professionals, MACPA Executive Director Tom Hood facilitated a session in which attendees ranked the top skills they need to be successful. The top five were communication, inspiring and motivating others, strategic and critical thinking, anticipating and serving evolving needs, and influencing / persuading others.
— “Top Ten Skills in New Hires,” a white paper produced by the Connecticut Society of CPAs, ranked critical / strategic thinking, time management / organization, writing skills / memos, and problem-solving as the top four teachable skills for young professionals.
Report after report clearly identifies the skills that employers say their teams need to help their organizations succeed. Despite that, young professionals say they are sorely lacking in those skills. The most recent Robert Half Readiness Index found that 56 percent of employees say they felt only somewhat prepared for their first accounting or finance job after graduation, while 14 percent said they were not at all prepared.

“Respondents were unready for their first professional jobs in multiple ways,” Accounting Today’s Sean McCabe writes. “Forty-nine percent indicated the knowledge they gained in the classroom didn’t translate to their position. Thirty-three percent said they felt ill-equipped to handle office politics, and 23 percent said they lacked technology skills or software knowledge.”
Plenty of blame for the skills gap is being passed around throughout the profession. Some employers says accounting programs at the nation’s universities have failed to adequately prepare graduates for the workforce. Some college professors blame the K-12 system, saying high school graduates don’t have the skills necessary to navigate college, much less a career. Others blame the young professionals themselves, saying they need to take charge of their own careers and personal development.

The answer might go deeper than that. The real cause might be the exponential pace of change and technology that automates lower-level skills and requires more “soft skills” (or as Hood more accurately calls them, “success skills”) at earlier ages.
The environment in the early CPA career is more demanding of those ‘soft skills,’ especially communication and business acumen or context. Some posit that in the future, all of the ‘back office’ functions will be automated, which will require entry-level workers to do more customer- and client-facing work earlier in their careers. What does this mean as far as the skills they’ll need to do that work?
The answer is found in the reports themselves: CPAs who succeed going forward will have mastered a series of so-called “soft skills” that will improve their ability to do that important client-facing work.
Our schools and universities can certainly do their part by transforming their business and accounting curricula to include skills like leadership, collaboration, and strategic thinking.

Until that happens, though, young professionals must take it upon themselves to learn the key skills that will make them future-ready. Doing so will boost their careers, put them on a fast track to leadership, and help their organizations outmaneuver their competition in a changing and world.

The word is spreading. Training in these “success skills” is available from more sources than ever. Among them is the Business Learning Institute, whose lineup of renowned instructors includes courses in leadership, personal development, strategic thinking, communication, and scores of other competencies (see online catalog).

BLI and the Maryland Association of CPAs joined forces with renowned futurist Daniel Burrus to offer “The Anticipatory Organization: Accounting and Finance Edition.” ™ It’s a revolutionary new learning system created by Burrus that teaches CPAs how to anticipate future trends and take advantage of the game-changing opportunities those trends offer. This new approach to learning was recently recognized as a Top (learning) Product for 2016 by Accounting Today Magazine. It is the first learning approach in the CPA Profession to feature nano-learning (three minute videos) job aids and action learning templates for on the job application. It allows you to learn a series of critical competencies in less time and with on the job application.
Regardless of where the training originates, it’s more important than ever that young professionals gain the skills they need to be future-ready. The future of their organizations — and their very careers — may depend on it.


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