Daniel Middleton is a Consultant at Argyll Scott, specialising in Accounting and Finance recruitment.
In business, and in life, many of us make our decisions logically. We base our choices on quantifiable factors; whether that is details from a profit and loss statement, or balance sheet, or what type of mortgage we take, or where we do our weekly shop. Within the world of finance, logical decision making is even more pertinent. After years of training in a ‘fact based’ environment, it becomes second nature to look at choices in a logical manner. Bearing that in mind, it is not surprising that ‘soft skills’ have historically been overlooked within finance and accounting, whereas ‘hard skills’ such as qualifications and technical ability have been at the forefront of decision making when hiring a new team member.
For the sake of this blog, let’s define soft and hard skills and how this ties in with our emotional quotient (EQ) vs our intellectual quotient (IQ). Simplistically, soft skills is a term associated with an individual's "EQ" (Emotional Intelligence Quotient), the collection of personality traits, social awareness, communication skills and management/leadership skills. The whole concept revolves around how we build relationships with other people.
Hard skills, on the other hand, are often tied in with our IQ and ability to learn. Hard skills are teachable abilities or skill sets that are easy to quantify. Typical examples of hard skills within finance are qualifications and technical ability.
Historically, it could be argued that soft skills are not important in finance; but that was in a time where accountants had limited interaction with operational staff and business leaders. Finance and accounting has changed over the past couple of decades. The influence a finance function has on corporate decision making is now much greater and at the forefront of the function’s purpose. For that reason, we have seen a huge increase in the number of management accounting or business partnering positions within finance – in these roles, soft skills are fundamental.
There are several CFO’s of listed companies that are not qualified accountants. These incredibly successful individuals may not be the most technical accountants, in fact, some of the ‘quantifiable hard skills’ that finance leaders look for will not be on the CV’s of these CFO’s. I would wager though, that they are exceptionally well versed in influencing others and utilising their soft skills. Could one argue then, that soft skills and our EQ is as important as our quantifiable hard skills? Possibly. What is certain though, is that you can teach a relatively sound accountant a new IFRS regulation a lot more easily than you can teach them how to interact with people and build relationships!
Unsurprisingly – I work in recruitment, where soft skills are key. I also have a maths and business degree, so what on earth is going on in my EQ vs IQ battle, who knows. But, if you are hiring, or looking to move roles yourself, it is worth considering the value of soft skills. EQ vs IQ – I don’t believe there is a cut and dry winner; but overlook and de-value soft skills at your own peril.
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