CMA®: Working to Close the Skills Gap

IMA® Middle East Conference 2011Tuesday, May 10, 2011

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CMA: Working to Close the Skills Gap

Panelists:

Hassan Sharafeddin, CMA, Chief Financial Officer, Federal Foods LLC

Aneel Iqbal, CMA, Ernst & Young Training Services

Cicek Onder, CMA Candidate, Analyst, Hewlett-Packard

Facilitator: Dennis Whitney, CMA, Senior VP, ICMA

• CFOs complain there is a skills gap among all levels of their finance and accounting teams in the areas of financial planning, analysis, control, and decision support

• The CMA exam and curriculum focus squarely on these critical areas

• Our panel of experts will share their views about the skills gap as well as the importance and relevance of the CMA exam

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Research with CFOs Confirmed

• Finance Teams need to raise their competency level

• Planning and analysis capabilities are needed and in short supply

• There is a challenge identifying “advanced” or high potential finance and accounting staff

• University business curriculums do not develop in enough depth the skills most needed on the job

• Planning, analysis, control, and decision support – the focus of the CMA exam

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CFO Global Research Study Sources

o The New Value Integrator, Insights from the Global Chief Financial Officer Study - IBM, 2010

o Being the Best, Insights from Leading Finance Functions -KPMG and The Economist Intelligence Unit, 2006

o Balancing Risk and Performance with an Integrated Finance Organization - IBM, The Wharton School and Economist Intelligence Unit, 2007

o The Changing Role of the Finance Organization in a Multi-Polar World - Accenture, 2008

o IMA Research Studies

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Research Insights

The New Value Integrator, Insights from the Global Chief Financial Officer Study, IBM, 2010

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Research Insights

The New Value Integrator, Insights from the Global Chief Financial Officer Study, IBM, 2010

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A Few Relevant Quotes:

The New Value Integrator: Based on conversations with 1,900 CFOs worldwide

“Our job is to focus the enterprise on making timely, risk-based decisions by providing access to the right business-relevant information and insight-drivenanalytics.” – CFO, Kimberly Clark

“Finance must enhance its advisory role and add greater value. Control and accuracy are absolutely important, but we need less data crunching and more analysis and insight.” – CFO, Westpac Banking

“Business analytics is one of our most critical Finance initiatives. We need to have the right people and tools and stay very close to the business.“ – CFO, Office Depot

The New Value Integrator, Insights from the Global Chief Financial Officer Study, IBM, 2010

CFO Dissatisfaction … We Must Do Better

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Critical Business Issue: CFO Team Not Achieving Aspirations

• Processes• People• Education, CertificationCurrent Reality:

•Transaction – Heavy•Counter of Wealth•Some Influence

Aspirations:•Partnering & Consulting•Creator of Wealth•Maximum Influence

GlobalizationStakeholder Sophistication Compliance

Supply

Demand

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What CFOs Are Saying …. Required Skill Sets

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FROM: TO ALSO INCLUDE:Budgeting Integrated Planning, Budgeting, Forecasting

Excel Forecasting Predictive Analytics/Business Intelligence

Financial Risk Identification Broader Enterprise Risk Management

Product Profitability Customer Profitability/Lifetime Value

Primarily financial metrics which are lagging indicators

Balanced metrics – the 3 P’s (Profits, People and Planet) – which include leading indicators

Soft skills nice to have Soft skills required to become a credible analytical influencer – LEADERSHIP!

Analytical capability helpful Data analytics a competitive advantage

What CFOs Are Saying …. Bottom Lines

• Aspire to move from counter of wealth and compliance cop to creator of wealth and influencers of strategy

• This requires a whole new set of management accounting and finance function skill sets

• Sourcing these new skill sets is problematic and therefore they tend to be “home grown” especially in larger enterprises

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The CFO as Value Integrator

• It’s no longer “good enough” to excel at core finance activities

• The finance operation needs to advise on strategic and operational issues too

• The “integrator” role involves integrating information to achieve efficiency and business insight

• The Value Integrator’s mission should be to help the company think as an overall business instead of individual areas

• The CFO is a “trusted business advisor”

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Business Insight and Analysis

REAR VIEW MIRROR MAGNIFYING GLASS CRYSTAL BALL

What happened? What exactly is the problem? What will happen next?

How many, how often? Why is this happening? What if the trends continue?

What actions are needed? What are the risks/opportunities?

REAR VIEW CURRENT VIEW FORWARD-LOOKING VIEW

Balance sheet, P&L and cash flow statements

Customer, product & market profitability

Cash forecasting

Revenue & cost variance analysis

Spend optimization Scenario-based planning & forecasting

Working capital analysis Strategic investment & decision support

Market, customer & channel pricing

Volatility & risk-based predictive & behavioral modeling

Sales & supply chain effectiveness

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The New Value Integrator, Insights from the Global Chief Financial Officer Study, IBM 2010

CMAs Serving As Trusted Business Advisors

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CMA

Decision Analysis

Risk Management

Internal Controls

Planning & Analysis

Strategic Cost Management

Financial Leadership

Hassan Sharafeddin, CMA

Why the CMA?

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WHY CMA?

• As management accountants, we look at the present, keeping the past in mind, we plan for the future. We do not assess past performance and stop there.

Present & Future Focus

IMA research tools

Continued Educational resources

Career Booster

& Much more…

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WHY CMA?

• CMA = more MONEY?Definitely!Middle East Salary Survey 2010

Present & Future Focus

IMA research tools

Continued Educational resources

Career Booster

& Much more…

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The CMA Certification•The CMA (Certified Management Accountant) is the advanced professional certification specifically designed to measure the accounting and financial management skills that drive business performance. Leading employers—from multinational corporations to private firms, academic institutions, and not for-profit organizations—seek out CMAs to fill positions requiring critical accounting and financial management skills.

•How important is certification in regards to compensation?

•CMAs earn 122% more in average salary and 117% more in total compensation (including salary and other compensation) than their noncertified peers. This means that on average, earning a CMA will more than double your salary.*

•This translates to a total of up to $2.6 million in extra lifetime earnings for someone in their early 20’s.*

•IMA members continue to provide incredible value to the organizations where they work.

Source: IMA Website

Cicek Onder

Building your Career with IMA and the CMA

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Building Confidence

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Technical Skills

Analytical Skills

Competence

Trusted Advisor

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Expanding Career Options

Broader Background

Strategic Thinking

Next Level in Career

Leadership Development, Social Responsibility and Networking

IMA Chapters are a great opportunity for:

• Developing leadership skills

• Information and experience sharing

• Improving business acumen

• Developing soft skills

• Teamwork

• Networking

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Aneel Iqbal, CMA

Benefits of the CMA

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Potential Benefits to Individuals

• pride in accomplishment

• official recognition of the recipient’s knowledge

• enhanced career advancement opportunities

• impetus to improve work and communication skills

• increased job security

• the ability to qualify for work using specialized software or in sensitive governmental or corporate areas

• qualification to hold office in particular professional societies

• enhanced prestige or visibility in his or her job and professional community

• the potential for financial remuneration

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Potential Benefits to Corporations

• an independent metric with which to screen job applicants

• a knowledgeable work force

• encouragement of continuing education for employees

• enhanced employee understanding of matters and concepts beyond their immediate job descriptions

• the availability of objective criteria with which to award raises and promotions

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Some relevant Quotes

• In a meritocratic tradition people do not resent being influenced by people whom they regard as the experts… Because this power source is the most socially acceptable it is also the most sought after.” (Handy)

• “(we) forget what we memorize. Content knowledge becomes dated and often not transferrable across different types of jobs….Critical skills rarely become obsolete and are usually transferrable across assignments and careers.” (Albrecht and Sack 2000)

• …(There is) a lack of a shared vocabulary between education and work.” (Leveson 2000)

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Why are Saudi corporations opting for CMA

• Emphasis on core skills

• No obsolescence of skill set with change in laws and regulations

• Universal applicability

• Managerial Focus Vs Technician Approach

• Time and Cost Effective

• Flexible

• Fewer requirements “of Assumed Knowledge”

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