Accountants facing digital disruption should be brushing up on their “soft skills” to raise their job market appeal.
By Ben Power
Search giant Google was founded by two computer scientists, Sergey Brin and Larry Page, and algorithms drive its search business.
But in 2013 Google decided to analyse its hiring practices. As reported by the Washington Post, the company’s “Project Oxygen” crunched data on all its hiring, firing and promotion practices.
The findings, partially released to the public at the end of 2017, shocked the tech giant’s leadership. The seven top characteristics of Google’s successful employees were all “soft skills”, and included empathy, critical thinking, connecting complex ideas, coaching and communicating. The set of skills collectively known as STEM – science, technology, engineering and mathematics – came dead last.
Google’s research is a timely reminder that, for professions like accounting, technical skills are not enough to compete in the digital era. A key edge will be the ability to build and develop softer skills like empathy and creativity.
The soft surge
“The accountant of 2030 is likely to be highly creative, very digitally savvy, but bring high degrees of empathy and creativity to what they do,” says Aaron McEwan, Gartner’s HR practice leader for Australia and New Zealand.
That creates new challenges: how best to develop soft skills, which ones to focus on, and, importantly, how to measure success in skills that involve nuance and human interaction and emotions.
Google’s findings are not entirely new. For some time there has been a growing recognition that “soft” non-technical skills such as communication, emotional intelligence and creativity help talent and organisations outperform.
Academics, including David J. Deming, a Harvard professor and co-editor of the Journal of Human Resources, are highlighting the importance of soft skills. Deming says in a 2017 paper for the National Bureau of Economic Research (NBER), The Value of Soft Skills in the Labor Market, that the evidence is overwhelming that soft skills “are important drivers of success in school and in adult life”.
A 2017 report by Deloitte Access Economics, Soft skills for business success, noted that having staff with more soft skills boosts productivity and could increase revenue for the average Australian business by more than A$90,000.
One of the report’s co-authors, Jessica Mizrahi, says demand for soft skills is surging. She notes that 10 of the 16 “crucial proficiencies for education in the 21st century” identified by the World Economic Forum are non-technical.
The Deloitte report forecasts that soft skill-intensive occupations will account for two-thirds of all jobs by 2030, compared to half of all jobs in 2000. The number of jobs in soft skill-intensive occupations is also expected to grow at 2.5 times the rate of jobs in other occupations.
The trend towards soft skills is already happening. Though successive US administrations have urged youngsters into science and tech-focussed careers, Deming notes that STEM’s share of US occupations fell between 2000 and 2012, while social skill-intensive jobs grew some 12 percentage points as a share of all US jobs between 1980 and 2012.
Don’t be a machine
The central impetus for the rise of soft skills, as Deming highlights, is that as routine tasks become automated, skills and tasks that can’t be done by machines increase in value. The likes of empathy and insight, particularly, become vital to maintain a competitive edge.
“Businesses increasingly rely on critical thinking, emotional judgement, and problem-solving skills in their staff to not just understand what technology is saying, but analyse why it is saying it, and what ought to be done,” the Deloitte report says.
Gartner’s McEwan says that data is becoming the lifeblood of organisations. “But that data on its own isn’t particularly helpful,” he says. “People don’t need more data, they need more insight.”
“What the organisation is really looking for from accountants or finance staff is to give insights into the business that can help improve decisions about how to run the business more effectively.”
McEwan says that more organisations in a low-growth economy are also turning to innovation and creativity to drive growth. He notes that research shows that changes in customer expectations are driving volatility and disruption, not technology. “As we try to better understand customers and what they care about, that requires empathy,” he says.
Matt Graham, PwC’s managing partner for assurance, agrees that data isn’t enough, and a true edge is the ability “to put yourself in somebody else’s shoes and understand issues on their mind”.
Training for soft skills
Based on hiring practices, accountants seem to be recognising the importance of soft skills. US-based Recruiter Robert Half Finance & Accounting surveyed more than 2200 CFOs in 2017 and found that 54% of them valued hard and soft skills equally when filling open positions. And 10% actually gave more weight to soft skills.
There are myriad soft skills like communication skills, critical thinking and problem solving. But Mizrahi says there are others, including ethics, that also need to be developed.
“Accountants are trusted advisors to so many businesses – both big and small – and they have access to mission critical information,” she says. “Having the courage to talk about the problems and solutions and even sometimes having the courage to say ‘I think you’re doing the wrong thing’ is really critical for the profession.”
McEwan defines digital skills as “soft” and argues that accountants should also focus on developing them. He says they need to become increasingly comfortable with using technology – machine learning and AI – to provide insights.
But how can organisations, people and accountants get better at soft skills? Can you train for soft skills? “You can,” McEwan says. “You can learn those capabilities.”
PwC’s Graham says the key, at the individual level, is practice (see breakout).
But most agree that improving soft skills begins with organisational culture.
Just learning behaviour isn’t going to help, McEwan says. CFOs and heads of finance must create cultures where soft skills are empowered, encouraged and rewarded. He says there is no point sending staff to a six-month innovation course “if when they come back the CFO knocks every idea back”.
Graham agrees that organisational culture is vital. He says that soft skills are at the heart of PwC’s core set of five values – act with integrity, make a difference, care, work together, and reimagine the possible.
“They are at the centre of every interaction we have with our clients and our people. They are our true north when we have got difficult decisions to make, and it creates an environment where everybody recognises how we treat each other and clients.”
Graham says that learning soft skills at PwC typically fits the 70/20/10 ratio. Around 70% is learnt on the job, watching role models; 20% is developed from direct feedback; and 10% is formal training. PwC includes soft skills in its Vantage bespoke learning application.
The measurement challenge
But Mizrahi says one of the biggest challenges for organisations is to become better at measuring soft skills. How will they know that they are improving their talent’s soft skills? Harvard’s Deming notes that the study of soft skills is “hamstrung by poor measurement and lack of definitional clarity”.
Organisations are bringing in external consultants to help. But “we haven’t quite come up with full objective measurement [of soft skills],” Mizrahi says. “That will be an important consideration for a lot of employers going forward.”
“As we learn to value the critical importance of human capital, in most organisations I think we’ll start moving away from people as a cost, to people as an asset, and there is a whole bunch of measurement frameworks we will need to consider,” she says.
After Project Oxygen, the original study that highlighted the importance of soft skills, Google started another study, Project Aristotle, which analysed data on how inventive and productive teams were. It found that the company’s most important and productive ideas didn’t come from its A-teams of top scientists, but from the B-teams of less “smart” staff.
The best teams boasted a range of soft skills: generosity, curiosity, empathy, emotional intelligence and above all emotional safety: the confidence to speak up and make mistakes. Google is now hiring staff from MBA programs, but also artists and humanities majors.
Accounting firms may not yet hire English literature grads for their audit department, but if they – and their employees – want to thrive in the future, they will need to build their soft skills. That challenge is far from soft.
Heading The best skills
arly in his career, Matt Graham, PwC’s managing partner for Assurance, faced a difficult situation. A client whose career was under threat became volatile and angry. But Graham remained calm, settling the client down and walking them through various scenarios. It was then that Graham realised he was developing his soft skills – in this
Graham says soft skills have played a key role in his career success, both in dealing with clients but also leading more than 2000 people in his division at PwC.
He believes the core of soft skills is “the ability to be with other people and focus on their needs and interests and prioritise them over yours”.
Graham advises accountants to focus on three main soft skills:
- Emotional intelligence: Understand the impact of your behaviour on other people. That requires you to sit on the “balcony of the dance” – to step outside yourself and watch how you behave and talk with people.
- Communication skills: Become articulate and insightful, and don’t overdo the technical competence or get locked into minutiae. Rise above, and connect the dots and themes.
- Selflessness: Graham says he believes he is doing his role well when he consistently focuses on the needs of others – his clients, their stakeholders, his partners, and the team he leads.
“But soft skills are really hard skills to master,” he says.
How do accountants improve their soft skills? Graham suggests three steps:
- Understand what your values are. “Be confident and articulate in what those values are for you and use them as a compass to guide your behaviour in all situations, the tough ones and the easy ones,” Graham says.
- Be vulnerable. Being excellent at soft skills means being willing to learn and adapt and understand how you’re impacting other people. “You can only do that if you’re willing to listen to how you’re impacting other people, then act on that feedback and alter your behaviour. You can’t do that if you have got a mask up.”
- Practice. “Every important communication, every difficult discussion you’re about to walk into, you practice that just like you would practice for any other harder skills you’ve got in your toolkit,” Graham says. “The preparation, the training of the muscle is just as critical in these areas. Practice listening; practice asking extra questions; practice public speaking, which are all critical.”
Ben Power is a Sydney-based business and finance writer.
This article was originally published in the October 2018 issue of Acuity.