As business organizations face complex challenges, the skills and competencies of their finance professionals need to be up to the task. The traditional role of the accountant — someone who reports short-term financials — is no longer sufficient for a business world challenged by disruptive technology, the need for good storytelling, geopolitical risks, and emerging regulatory frameworks.
But within the finance function, a role already exists that addresses, holistically, how numerous issues impact an organization’s sustainable business performance: the management accountant. It’s a role that is certain to expand in scope and importance in years to come.
With virtually every business decision being one that impacts the financial statements, management accountants influence the entire value of the organization. In addition to budgeting, forecasting, performance management, and internal control, management accountants exert influence on decisions involving strategy, operations, and technology.
Broadly, that is what a management accountant does. Organizations that don’t recognize the value of management accountants or don’t recruit the right talent for the role are facing a skills gap. They need professionals who can not only report the numbers but also offer new insights and “tell a story” about the data to move the organization forward.
So, what are the more specific capabilities that management accountants bring to their organizations, and what particular competencies, responsibilities, and functions do they entail?
Management accountants are analysts who can successfully determine what the numbers “mean” for the company and are always seeking discoveries in the data. They’re “data explorers” if you will, answering the standard questions of management but also delivering new insights through analytics and visualization. Those insights should be about the organization’s supply chain, including the cost of service, innovation, insights into consumer behavior. Management accountants today are increasingly expected to deliver insight and foresight. There is a distinct difference between a management accountant and the traditional “bean counter,” who is vulnerable to having his or her competencies performed by robotic process automation (RPA) systems.
Management accountants use the competencies of budgeting and forecasting to help senior leaders make the best financial and business decisions. By working closely with CEOs and other executives, management accountants play an instrumental role in crafting and executing long-term strategy. The in-depth knowledge they bring to the table (and the boardroom) can mean the difference between success or failure for new initiatives, product and service launches, or expansion into new markets. In the 21st century, when so many different factors can impact an organization’s finances, management accountants must be integral to the senior decision-making process. In effect, they offer technical accounting depth with business operations breadth.
As leaders of an organization’s finance function, management accountants must be able to manage and lead teams successfully. Many management accountants are skilled at leading teams, monitoring their progress, and identifying which people are best for which jobs. These are all core skills that management accountants can be expected to perform. In addition, they can develop strategies and execute detailed plans, often across multiple departments and divisions of an organization.
The management accountant sits at the intersection of finance, technology, analysis, strategy, and leadership, helping to determine what drives profits and losses rather than just reporting on them. He or she takes a step further than reporting, helping the C-Suite devise strategies for long-term growth and adaptation to changing markets.
A management accountant is an asset to an organization struggling to understand the best path to stability and growth or straining to translate lofty “big picture” goals into concrete financial and operational actions. For finance professionals who want to make a real impact on organizations, this is an ideal role. And for organizations in need of informed financial decision-making that directly influences sustainable business value and growth, the management accountant is essential.
Jeff Thomson, CMA, CSCA, CAE, is president and CEO of IMA® (Institute of Management Accountants).