Businesses and the accountancy profession will need to be better prepared to anticipate and respond to the unprecedented challenges of a volatile global economy while seeking and capitalizing on opportunities, according to a new report from the Association of Chartered Certified Accountants' (ACCA) Accountancy Futures Academy (AFA).
Based on insights from members of the AFA as well as members of the Institute of Management Accountants (IMA) and ACCA's other global forums and experts, the authors outlined ten strategic imperatives that businesses and the accountancy profession need to undertake to ensure they can perform effectively in an environment of uncertainty and rapid change.
Five Imperatives for Business
1. Assume and plan for volatility. With uncertainty as the new normal, businesses have to factor in turbulence as a very real possibility and develop strategies for a range of different economic and market scenarios.
2. Build your radar. Systematic, organization-wide approaches are required for scanning the future external environment. Preparing for a wide range of possibilities, tolerance of uncertainty, curiosity, and "seeing round corners" are becoming critical development priorities for managers and leaders alike.
3. Pursue technology leadership. The pace and disruptive potential of information and communications technology (ICT) development has placed technology at the heart of strategy and operations of businesses of almost every size. New mind-sets and approaches to technology management are required to exploit and extract full value from the next decade of advances.
4. Prepare for true globalization. Development of a truly global operating model is becoming a priority. A clear emphasis is required on leveraging technology effectively. Equally important is developing the capability of management to work with, adapt to, and get the best out of a multi-location, multicultural, and age-diverse workforce.
5. Develop a curious, experimental, and adaptable mind-set. A critical success factor in an increasingly complex and fast-changing environment is building a "curious" culture. This implies nurturing an environment that is open to external ideas in which participants are encouraged to forge a network of strong working relationships across the entire business ecosystem.
Five Imperatives for the Accountancy Profession
1. Embrace an enlarged strategic and commercial role. As businesses adapt to a turbulent environment, opportunities are emerging for accountants to assume a far greater organizational remit. The potential exists to leverage the capabilities of the accountant across all aspects of corporate decision making, from strategy formulation to defining new business models.
2. Establish trust and ethical leadership. The profession needs to be seen to be addressing clear public concerns. According to the research conducted for the report, there is a perception that it could do more to highlight and prevent everything from small-scale financial irregularities to the major systemic failures that helped cause the global financial crisis and ensuing economic uncertainty.
3. Focus on a holistic view of complexity, risk, and performance. There is growing consensus on the need for reporting to provide a firm-wide view of organizational health, performance, and prospects. Such a holistic perspective must acknowledge the complexity of modern business and encompass financial and non-financial indicators of a firm's financial status and potential.
4. Develop a global orientation. The pace of global expansion of firms, from developed and developing markets alike, is placing the spotlight on accountancy's ability to master the technical, language, and cultural challenges of cross-border operations.
5. Reinvent the talent pool. The diverse range of demands and impacts on the profession is forcing a rethink of everything from training and development to the type of people being recruited. Characteristics such as entrepreneurial spirit, curiosity, creativity, and strategic thinking skills, could assume far more significance in the selection of tomorrow's accountants.
"The research emphasizes that we are entering an increasingly uncertain world where almost every aspect of the economy, business, and the accountancy profession will be in a state of flux," said Raef Lawson, Ph.D., CMA, CPA, IMA vice president of research. "The drivers presented in this report highlight critical issues that will shape the global landscape."
Ewan Willars, ACCA director of policy, said, "The fact that these drivers of change have been identified by those working in accountancy clearly demonstrates the profession is willing and able to engage in long-term strategic thinking. The key question is what do we do with these powerful insights? It is now up to the profession to ensure it meets the public's needs for the highest standards of integrity, while taking a broader leadership role in both business and society."
Source: October 2, 2012, IMA/ACCA Press Release and 100 Drivers of Change for the Global Accountancy Profession Report