Generation Z and the Future of Finance

7th Sep 2021
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Gen Z are beginning to enter the workforce in larger numbers as they complete their education. Having experienced the significant disruption to their own lives during the pandemic, Gen Z are likely to be vigilant to the emotions of others in the workplace with the latest technology to boot.

CFOs and Finance Directors will benefit from this greater level of empathy and adaptability from Gen Z. These are qualities that are critical components of emotional intelligence which have also become expected from CFOs and Finance Directors as their roles evolved overnight during the pandemic.

However, every generation communicates differently. When Baby Boomers entered the finance function in the workplace, they were accustomed to using typewriters and calculators to deliver on figures without the presence of the Internet. Millennials, however, experienced the birth and growth of the Internet, and adapted to manually inputting data into Excel spreadsheets on office-based computers.

The impact of Gen Z entering the world of finance will be profound and certainly shake things up. Radically different than Millennials, this generation will have an entirely unique perspective on technology, their careers and the definition of success in life and in the workforce. For CFOs and Finance Directors, the time to think about this is now. Gen Z will be arriving in the workforce before you know it.

Who is Gen Z?

Gen Z are people who were born between 1996 and the early 2000s. This means that a large percentage of this generation are either currently studying or are just entering the workforce. They bring with them new ideas and methods for getting work done for their employers.

These new ways of working and thinking are closely linked to the social, economic and political climates present during their childhoods. Raised during The Great Recession with consistent access to the Internet and seeing the growth of online social networking to stay connected has contributed to a technology-first expectation when entering the workplace.

However, the workplace today is made up of an array of generations. Baby Boomers are known are the post-World War II generation born between 1946 and 1964, Gen X represents people born between 1965 and 1980 and Gen Y, often known as Millennials, cover the birth years of 1981–1997.

Age and experience aside, where these generations differ most is when it comes to their attitudes, expectations and values. These extend to expectations in the workplace in how they approach their day-to-day work, communication, and the software tools they are accustomed to.

Why should CFOs prepare for Gen Z now?

Gen Z are going to have far different expectations than previous generations when it comes to team collaboration, access to financial data in real-time, and delivering the numbers accurately on time, every time. This up-and-coming generation of workers are going to want information coming directly to them – not only on their laptops but on their mobile devices.

As already established, every generation in the workplace communicates differently. For CFOs and Finance Directors, this will mean crafting internal communication strategies via Cloud technology to appeal to all the different generations in the finance team. One size doesn’t fit all, which is why it’s going to be important to deliver real-time data to team members from a single, accessible source of truth.

How can CFOs support Gen Z employees?

Understanding the preferences, behaviours and expectations of Gen Z entering the workforce is paramount. CFOs and Finance Directors will need to take a step back to reassess how the workplace itself is changing and evolving.

Although the sudden shift to working from home for employees was a result of the pandemic, the advocacy for greater flexibility based on changing age demographics and technology improvements were always in the works

The pandemic accelerated the need for CFOs and Finance Director to become more of a strategic adviser, assuming much the responsibilities associated with the role of a COO. A significant part of this transition has been achieved through the adoption of Cloud accounting software to summon up accurate, real-time financial data to meet new levels of business demand.

The new realities produced by these forces of change present the future of finance in the making. It’s going to require a different mindset from CFOs and Finance Directors. Real and tangible focus should be placed on evolving manual processes in finance through automation, an increased level of empathy, boosting workplace productivity through work-life balance and using technology to become better connected. Without these considerations, entire industries and businesses will rise and fall in the wake of Gen Z.

Create value for new and existing employees

The driving force behind Gen Z will be building a sense of community, work benefits and career advancements. However, this also extends as a motivator for previous generations as the way of working continues to evolve. To keep your new and existing finance team members engaged and satisfied at work, the introduction of benefits such as paid time off, mental-health days, or activities that create a sense of community will be essential.

When looking to attract and retain talent, CFOs and Finance Directors must consider what they can offer to Gen Z and extend to previous generations which encourages workplace productivity, healthier lifestyles and greater well-being. It’s time to think beyond traditional employee benefits and begin planning to foster a workplace culture that establishes purpose in individual career development and lifestyle needs.

Building a sense of community in light of the pandemic will be more important than ever. Providing your finance team with a Cloud accounting solution with the ability to interact and communicate with one another will be a vital component in helping promote a positive culture. Creating such an atmosphere will help lessen turnover, ensure employee engagement (and higher revenues), and ultimately result in workers who strive to reach their full potential.

Embrace Cloud technology

Gen Z and a percentage of Millennials grew up using social media platforms which exposed them to constant streams of real-time feedback in the form of likes, comments, and shares. Accompanying this generational shift taking place within finance brings the need for CFOs and Finance Directors to adopt Cloud accounting software.

 As true “digital natives”, these younger generations expect the same level of connectivity and access to real-time data to do their day-to-day tasks. Not only are they experts in social media platforms such as TikTok, Instagram and YouTube, they are also accustomed and comfortable in using high-level software crucial to business continuity in the future.

Already equipped with the knowledge and skills to use such applications, they will expect to use them in their jobs. Organisations using out-dated software, or even spreadsheets, will be deemed as “behind the times” and risk losing out on the emerging talent and skills Gen Z offer.

It makes sense that Gen Z will want to communicate at work the same way they are able to connect and interact with people via social media. Instant access to company updates, resources, career progression, training, feedback, and direct interaction with management and colleagues will be expected. Organisations who are unable to fulfil this level of technology in the workplace should expect less demand from Gen Z to join their business.

Using a Cloud accounting software solution will not only reap benefits for previous generations in the finance team but will fulfil the Gen Z need for real-time access to data to do their jobs, and to stay connected in the workplace.

Skill development

The pandemic saw Gen Z’s learning disrupted overnight. Zoom calls for online lessons and coursework submission were quickly implemented.  These options may had been right for the moment, but the isolated environment and lack of in-person socialising has certainly impacted this generation. As a result, Gen Z may experience a difficult cultural transition when leaving education to join the world of work.

CFOs and Finance Directors will need to demonstrate empathy and patience as Gen Z adjust to their finance team by placing greater focus on intergenerational mentoring and support. Outdated E-learning courses should be reviewed and updated with considerations to ease Gen Z’s transition and help them integrate into the organisation.

Mentoring will also play a crucial role. Using the structure of trackable personal development goals and performance objectives will serve as a strong foundation for Gen Z to understand their purpose and role in the finance team. For older generations, the shift from traditional accounting software and spreadsheets to Cloud accounting software could be an unwelcome change.

To help bridge this gap, the introduction of reverse mentoring programs where Gen Z employees help older generations improve their skills in Cloud technology and social media could proof to be beneficial for both parties through a stronger multigenerational culture. For members of Gen Z, these mutually supportive relationships could enhance their expertise and ease their transition into the workplace.

To maximise the opportunity for successful mentorships, CFOs and Finance Directors should ensure Gen Z understand the benefits of this guidance and use this as an opportunity to dispel any negative perceptions that could weaken engagement by provided the dedicated time and resources. As a result, dedicated skill development will provide faster progress for Gen Z through enhanced and guided learning.

The future of finance is here

No one knows for certain what the future will hold, but CFOs and Finance Directors have a responsibility to be thinking about what’s likely to happen, and how to prepare for the future of finance.

Having a finance department that is ready to embrace workplace productivity and digital ways of working through Cloud accounting software means you will be well placed to attract and retain the future Gen Z talent in the market to your finance team.

Now is the time to use clear vision and strategy to create a roadmap for the future of finance and Gen Z in a digital world. Find out more about our Cloud-based accounting software, and our all-encompassing business management solution (which is also Cloud-based). Learn how we can help you get the right technology and people in place today for the future.