Don’t be caught making saddles when you should be making car seats. That was the key message restated by several innovation experts at the CA(SA) of the Future conference.
Words: Monique Verduyn
Digital transformation is reshaping
industries across the globe. Klaus
Schwab, executive chairman of the
World Economic Forum, wrote that
the Fourth Industrial Revolution
(4IR) – which is unleashing social,
political, cultural, and economic
upheavals – builds on the widespread
availability of digital technologies
that were the result of the digital
revolution. It will be driven, he
said, by the convergence of digital,
biological, and physical innovations.
Every aspect of life is being affected
by the digital revolution, and the
chartered accountancy profession is
At the recent CA(SA) of the Future
conference, experts from various
fields gathered to share with the
audience what we can expect of the
future of work and how to prepare
for it, why humans are wanted in the Fourth Industrial Revolution and why fully rounded CAs(SA) are needed.
HOW SKILL SETS CHANGE
In 1890, a New Yorker took more than 290 horse-drawn carriage rides a year. By the early 1910s, the number of automobiles had surpassed the number of buggies in Manhattan. Few had foreseen that a pivotal time of technological transformation was underway, but at least the citizens of the Big Apple had some time to get used to the effects of change.
Things are different today, according Willem van der Post CA(SA), exponential technology expert, and the CEO of xTech Capital and founder of the xTech Institute. ‘The MBA-type education has equipped people with roadmap thinking that enables them to get from point A to point B, and CAs(SA) have been taught to think retrospectively. Unfortunately, the future requires fundamentally different skill sets to ensure we do not suffer the same fate as those who were manufacturing saddles instead of cars seats at the turn of the last century.
It is not easy to let go of the old, the understood and the familiar, but it is essential.’ Van der Post said the theory that computing doubles in power every two years is becoming obsolete as technology is now doubling in capability, capacity and speed as quickly as every nine months. ‘How do you prepare a curriculum for the future when the skills acquired may already be obsolete by the time the ink dries on the certificate?’
At last count, he added, he identified 18 exponential technologies, including nanotech, quantum computing, artificial intelligence, machine learning, extended reality, robotics, digital biology, blockchain, cryptocurrency the Internet of things, and 3D printing, to name a few. ‘As CAs(SA) we are equipped to do audits, check tax compliance and provide reports, but how are we positioning ourselves for a future that is unknowable?’
Jeremy Gardiner, director at Investec Asset Management, took the delegates on a whistle-stop tour of global and local economic conditions and looked at some of the key trends that are affecting South Africa. ‘The fate of the world lies in the hands of Donal Trump and Boris Johnson, and what happens to the rand and our economy is determined by international events,’ he warned. Gardiner pointed out that in 1994, a year before Amazon.com arrived, the world of online retail was viewed with scepticism, confusion and outright dismissiveness. ‘Since then we have seen the birth of the sharing economy when it comes to carsm accommodation and even fashion, thanks to millennials – a generation that values experience and access over ownership. WhatsApp users are sending 65 billion messages per day and 29 million WhatsApp messages are sent per minute. Facebook knows more about you than your friends, family or even your spouse, and the organisation has information on 2,5 billion active users.’ Disruptive forces are sweeping the global economy, he added. Automation and the digital economy are boosting productivity for some, while eroding old sources of advantage for others. Trump’s strategy is to get re-elected, he added, which requires him to stimulate the US economy and that’s good news for emerging markets like ours, but we need to be ready to seize opportunities offered by the digital revolution.
IF MACHINES ARE GETTING SMARTER, SO SHOULD WE
All this talk of change can be unnerving. ‘Vulnerability is the birthplace of innovation, creativity and change,’ said research professor and author Brené Brown in one of her now-famous TED talks. Many of the world’s great innovations were born decades before they eventually swept through society, and often occurred sequentially. But now, they happen simultaneously and at a much faster pace.
Kirsten Leeuw, founder of Dcoded, a strategy and insights engine that exists to foster insight, innovation and impact in Africa, called on delegates to embrace 4IR as a new chapter in human development. ‘Our ability to learn must be greater than the speed of change,’ she noted, referencing the ten mega shifts that are taking place in the world:
‘These mega shifts represent a huge evolutionary step for society, and their impact will have profound implications,’ Leeuw said. ‘It’s a Volatile, Uncertain, Complex and Ambiguous environment. VUCA is the best way to describe today’s business world. It is a totally new context, where old laws don’t apply. Settling into the discomfort of progress is the only way to keep your wisdom relevant. What are you reading, what are learning and what are you going to do about it?’
Leeuw pointed to Accenture’s Technology Vision 2019, which reported that companies wanting to compete and differentiate themselves in the postdigital era will need to adopt a new set of emerging technologies. The key set of new tech is DARQ: distributed ledger technology (DLT), artificial intelligence (AI), extended reality (XR) and quantum computing.
According to the report, ‘Collectively, the DARQ technologies will also power the innovation and opportunity uniquely associated with the coming postdigital era. As the business landscape transitions into a combination of digital natives and businesses well into their digital transformations, DARQ is the key that will open unimagined new pathways into the future.’ Digital transformation offers enterprises a whole new world of possibilities. One thing is clear: customers, employees and business partners expect more than ever. ‘In 1970, the Volvo Traffic Accident Research Team was formed,’ Leeuw said. ‘It has gathered and analysed data for decades, leading to many of the innovative systems Volvo has in its cars today. Most importantly, Volvo no longer positions itself as a motor vehicle company; instead, its value proposition is demand mobility solutions that are flexible, easy to use and personalised. Asset size and number of employees are no longer indicators of success. Instead, data is the new global currency and turning data into intelligence is the key to the future, which is exactly what Volvo did.’
BUT THE FUTURE OF WORK IS STILL HUMAN
Leeuw stressed that the human ability to learn is humanity’s most important differentiator and that technologies like artificial intelligence are freeing people up to do more. One example is the application of artificial intelligence in agriculture. Advances such as irrigation, mechanisation, synthetic fertilisers, and genetic engineering allowed humans to grow more food with less work, but AI is already allowing growers to be even more efficient by taking the guesswork out of farming.
THE VALUE OF BLOCKCHAIN
Blockchain is one of the top emerging technologies driving innovation in financial services. Because the network has no central authority, it is the definition of a democratised system. Simply, blockchain is a timestamped series of immutable record of data that is managed by a cluster of computers not owned by any single entity. Each of these blocks of data (block) are secured and bound to each other using cryptographic principles (chain).
Investec blockchain specialist Chris Becker described blockchain as an accounting technology for money. Becker noted that in 1971 the pound sterling and the US dollar lost their gold backing, turning money into nothing more than ‘a promise to pay something’, with the trust to protect its value placed in a committee. Blockchain operates on similar principles.
Because it is a shared and immutable ledger, the information is open for anyone to see, making it transparent and holding everyone involved accountable for their actions. ‘Blockchain is a consensus machine, an internet protocol for value transfer. It frees auditors to do higher value work, enables the near real-time settlement of transactions, reducing risk of nonpayment, and it retains a secure record of proof that the transaction occurred.’
BUILDING THE WORKFORCE OF THE FUTURE
Dr Juan Swartz CA(SA), co-founder and chief science and technology officer of 4th Talent, aims to help people flourish in a digital world. With 4IR rapidly changing the future of work, agile businesses need to rapidly adapt, and employees need to rapidly reskill. The impact of 4IR, he noted, included:
• Automation of ‘tagged’ tasks, irrespective of complexity
• Human role augmentation
• Human-machine collaboration on tasks
• Process allocation between human and machine
• Agile workforce
• Personalised learning
• Competency-based education
‘Building critical skills and competencies is the number one priority for organisations,’ Swartz said. ‘By using predictive talent analytics, we can address talent-related implications for the workforce of the future. They key is to bring together experts in adult learning, psychology, organisational behaviour, HR and talent management, behavioural economics, change management, predictive modelling and technology, to develop solutions to help organisations identify, develop and deploy talent.’
To create a truly agile workforce, he noted, required new and different methods. ‘An AI solution automatically determines your competency gaps and can intelligently compile a hyperpersonalised curriculum for each individual, allowing them to decide when, where, and how to learn. This approach enables a life-long, selfdirected and agile approach to learning. In the evolving world of the CA(SA) this is of value because we will contribute to discussion of how the business is preforming and growing, and not about its accounts.’
Earlier this year, the University of Johannesburg (UJ) and SAICA launched the 4IR for Accountants programme, providing an introduction to 4IR by exploring key topics include artificial intelligence, machine learning, natural language processing, blockchain and ethics. Speaking on 4IR at the conference, Professor Tshilidzi Marwala, vice-chancellor and principal of UJ, explained that when human traders are replaced by artificially intelligent traders factors such as emotion are subtracted from the markets. ‘Decisions are made purely based on data, and markets therefore become more rational, and rational markets become efficient.’ He noted, however, that people tend to have doubts when thinking of disruptive technologies, primarily because they fear being replaced by intelligent machines. ‘By not embracing change, the accounting profession risks being left behind. Global connectivity (because of IoT), smart machines (embedded in AI technologies) and new ways of communicating should not be feared as they open up enormous possibilities to tap into and exploit big data possibilities.
There is a real opportunity here for accountant to move upstream into strategic decision-making roles. Instead of being seen as “bean counters”, through data mining, analysis and insights into data, accountants can become the first to spot new opportunities and predict future patterns of behaviour. Looking beyond historical data could be expected to land accountants in a different landscape, where there are opportunities to scan the environment for emerging trends and formulating business opportunities.’
Mandi Olivier, senior executive for professional development, at SAICA agreed that we are experiencing a period of radical change. ‘Technology is disrupting the world of the CA(SA). The old laws don’t apply.’ The ability to adapt to this rapid change, she continued, will arguably be one of the most important attributes that CAs will need as many of the functions currently performed by CAs will soon be performed by sophisticated technology, ultimately changing the skills that will be needed by CAs(SA) in the future. For example, mundane work like data entry tasks, repetitive bookkeeping, memorising accounting standards and being able to record journal entries for transactions will be automated, leaving accounting professionals to focus on more strategic roles, like process improvement, cost control, and capital optimisation. SAICA’s CA2025 competency framework has been designed to take into account the skills that will be needed by CAs(SA) of the future, embracing notions such as being ethical in a broader context which includes making decisions that are morally correct; having a broader stakeholder view which includes making decisions which will not negatively impact on the general public (who rely on financial information and expert advice from CAs); having a medium- to longterm view of an organisation and therefore a longer-term and more sustainable view of the entity’s role; and embracing the importance of professional values and attitudes as well as enabling skills in line with the technical skills required.
‘There is no question that accounting is evolving, and professionals will have to learn new technical and non-technical skills to keep up with business needs in an extremely disruptive era,’ she said.
ARE YOU TECHNOLOGY ADJACENT?
But what happens when the pace of change is so rapid that people fear they simply cannot keep up? It’s a question that tech entrepreneur
Mushambi Mutuma explores in his book Tech adjacent: the exponential guide to leveraging technology for business success. The book looks at how to develop an understanding of the principles of tech and its pace, hearing the footsteps of where it might be going, knowing how disruption and innovation work tangibly and, most importantly, leveraging it for individual exponential success. ‘I encourage people to think about being adjacent to technology, by which I mean working in proximity with it in order to try to keep up. Technology has always allowed for evolution and innovation and what’s happening now is no different from what has been going on for centuries; it’s about how we make things simpler, better and different. It’s key to bear in mind that tech is also hereditary and is always based on a predecessor, which helps to demystify it.’
Stressing that innovation is not failproof, Mutuma spoke of Leonardo da Vinci’s principle of ‘dimostrazione’, an Italian term defined as a commitment to test knowledge through experience, persistence, and a willingness to learn from mistakes. This is the process by which people change the world, he said. ‘Technology’s job is to allow you to focus on what you do best: guiding and advising your clients and being trusted purveyors of growth. Be being adjacent to technology, we make our jobs easier and we solve human problems faster.’
THE NEW WORK ORDER
Tramayne Monaghan CA(SA), chief innovation officer of Tencent Africa, says he remembers feeling constrained by his qualification. Through his career journey he overcame that, developing a passion for innovation along the way. ‘If you have a job you can explain to your mom, leave,’ was his advice to the audience.
He highlighted the value of this approach by listing several jobs that did not exist ten years ago, including SEO specialist, app developer, crypto miner, driverless car engineer, podcast producer, professional gamer and Zumba instructor. What about the jobs that do not exist yet but will in a decade from now? ‘Think smart home handyman, human-technology integration specialist, wholeness mentor, end-of-life coach and chief productivity officer,’ he said. Turning to the CA(SA) of the future, Monaghan said he foresees three key qualities:
• Humane: Empathy and focusing on human capital without losing sight of technology
• Advisor: Be knowledgeable and trusted, build relationships
• Fluid: Innovate around problems, systems and people
A combination of customer value and innovation will determine the success of the future CA(SA),’ he said. ‘To quote Neil deGrasse Tyson, ‘Are you a good problem solver? Are you moral? Are you a hard worker? Are you a good leader? Do you have insights into the field?’
These are the questions that matter.’