Growing Numbers of Accountants Choosing Contract Work

Posted over 3 years ago

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Topic: Why are there growing numbers of accountants choosing to work on contract at senior levels in Tokyo.

We are talking to Jivago Matsuoka, the Managing Director for Advisory Group K.K. Jivago has been in the consulting, recruitment and contract staffing business in Tokyo since 2006. He launched the advisory services business at Advisory Group and is widely recognized for pioneering the growth of high-end contract and professional staffing services in Finance & Accounting. Jivago started his career as an accountant and transferred into banking and portfolio management, and then into consulting and recruitment in Tokyo.


Q1: Why are the numbers of personnel working on contract increasing in Tokyo?

There are a number of reasons, which I can outline today. Since Advisory Group started providing senior accountancy staff on contract, we have steadily increased the number of our contractors, principally Accounting Managers, Controllers and CFOs. We call them consultants. These are senior, qualified people, who are available to work for our client companies on a contract basis. The length of contract is individually tailored to the needs of each company. We are always keen to hear from candidates who are reviewing a change and wanting to work as contractors and companies who seek more information on contractor skills and to understand why this trend is growing.


Q2: Do you have issues of training when contractors change client companies?

No, because our staff are senior and very experienced. The very fact that they have already worked in a number of sectors, gives them more experience than others in their peer group. They also adapt quickly. We also offer a special deal in the first week, without cost, that I shall mention in a moment.

If you were to ask me, do we have any issues then yes, it is being able to predict when a company needs a contractor. To forecast this we visit companies and try to foresee when a company may need an extra resource. This helps us and them. We can plan to make sure a contractor is available. For the company, they have the assurance there is somebody competent and ready to start and hit the ground running.  

Many of our client companies tell us they see the benefits of using contract staff. It is also often the case that a fresh pair of eyes can spot an element that needs to change AND it is easier for someone who is "outside" the organisation to 1) identify the shortfall 2) Be less hesitant to say something. It can be harder for those "inside" the organisation. It is understandable they may be hesitant to highlight the issue and recommend a change.


Q3: What causes variations in the demand for contractors?

There are of course industry and sector variations with changes in sales revenues and turnovers. But there are also other reasons for variations in demand. The reasons we hear vary depending on whose opinion you seek and for confidentiality reasons I cannot go into detail. Also, a manager from overseas is often more aware of the concept and benefits of contractor services. Whereas despite the long-term and growing trends overseas, it is still new for some managers here who have only lived and worked in Japan. For some it can seem a radical and new concept, based actually on some out of date and wrong information.


Q4: Can you explain to managers how contracting has changed?

Indeed, this is so important. We need to explain this in more detail. There is a need for more awareness and understanding. There may still be some managers who remain sceptical, for example managers who think the contractor is a second-class candidate who cannot find a permanent job. This is certainly not the case. Nothing could be further from the reality. Our contractors are people who are very confident about their skills and they are experienced and senior. They have taken a career decision - preferring to work for a number of companies - on contract. 

One recently said to me "if I take a permanent role, I have to be sure the company will retain me long term. OR what if I realise that I have made a mistake and the company is not right for me? I have seen colleagues in contract roles advance faster than me. I want to gain new skills and grow my experience and the best way is to move from one challenge to the next. Back in the permanent role, when problems were solved, it all went back to the lack lustre routine, then what? As a contractor I can move to the next challenge. I want the challenge".

This is not unusual with top performers. These are people who can easily find permanent roles but they prefer contract work; they are confident and have an excellent track record. Some of the best workers in the market are contractors.  


Q5: What are you offering your client companies?

The value proposition we have is to present hands-on, mature and professional professionals, for example accounting managers, FP&A analysts, controllers and CFOs. These are people who are looking for challenging assignments. They also provide a value for money solution as the client company has no recruitment, training or any of the other permanent staff costs. Then when the assignment is finished and the company no longer requires the consultant, the consultant can move on to the next assignment.  


Q6: Do you see differences in contractor demand here and overseas? 

Absolutely yes. Tokyo is still catching up. For example in just one agency in London last week, an agency specialising in Accounting & Finance recruitment, they had 33 permanent vacancies and 66 contractor vacancies. What has happened? Why? What has caused this shift?

Accenture recently announced results of a survey that reported "75 percent of CFOs in permanent positions believe they are not very well positioned to meet the needs of tomorrow's digital business, requiring significant change in how they work.....firms are becoming data and analytics fuelled...the finance organisation [department] is best positioned as the source of analytical insight because it can connect market and operational data to financial outcomes...yet too many CFOs remain stuck in the role of Chief Bean Counter as compliance, control and accounting activities rule the day".  

CFOs realise they need to change, to adapt, to learn. Company Directors know that these people are key and increasing even more in importance as they can, with new technologies, see the pulse of the organisation in real time. For example bookkeeping in the cloud, new reports, formats, drill downs, and how results are presented - often leading to an "aha" moment, even for experienced senior directors. The phrase, “adapt or die”, sadly remains very true.

We all know that the rate of change is itself also increasing. Directors and Managers must keep themselves informed. No surprise then that CFOs have taken this on board and made the decision, for their career, to become contractors - they are in the top league.


Q7: For what other reasons has contracting gained the spotlight in other countries?  

There are a huge number of contractors in other countries. Every Japanese company wants to increase profits and so they share similar objectives to companies overseas. But they may not have seen the trend and the advantages unless they have worked overseas or spoken to colleagues with overseas experience. Firms based overseas hire contractors. We heard from one CFO, hired on a permanent basis to implement change in an organisation. He then asked himself, half way into year one, what will happen to my role when the change management is complete? He also asked himself can I find a new requirement, a new aim, or am I back to bean counting?  

Interestingly, during the first year when the Board had approved his changes he needed contract staff on a short-term contract to run the new technology and train the existing staff. As he said, "it was as if we had to service an aircraft while it was still in the air! We could not stop manufacturing and billing while all was changing in house, AND there were no in-house resources. I brought in contractors, staff gained new skills, added to their CV, no one was worried that they would lose their jobs because contractors were working with them. We were open with the details that the new people were on contract and would leave when the project was complete". 

This is exactly what happened. Incidentally it was all implemented in house 3 months sooner than an external vendor said they could complete the migration and 30% lower cost! 


Q8: What are the other benefits to the client company?

Sometimes companies think they have the resources they need. But if they take an unbiased view of the skills available, they realise they have a shortfall. But the possibility of raising budget for a new hire and the ripples that this can create with long term staff, can cause problems, so the predictable outcome - do nothing and muddle on. 

But the involvement with a short-term external contractor shines new light and a new solution. This is someone who is now inside the organisation - who, yes is new to the company but with exposure to methods and technologies used in competitive firms. A contractor who has probably met a similar or exactly the same challenge in other firms, as a contractor. Often they may have rolled out the solution many times in different firms over the last few years for a number of organisations. They are THE experts to complete the task. Once the task is completed the contract can be ended. Sometimes we have heard that if completed by a member of staff, perhaps after time consuming training and learning on the job, that person may feel over qualified for his old role and is selected by a competitor so he moves to another job. 


Q9: How do you cover security of information?

Most will know that all in the accountancy field are trained with awareness for the needs of security and confidentiality. We have never had a problem with this. Remember also that our contractors' reputations rely on their discretion and high degree of professionalism. They are also fully informed at the highest levels, and up to date, on all aspects of IT security, compliance and Intellectual Property.  


Q10: Do you have a list of skill sets available?

We should perhaps make a list of all the skills we have available when detailing all our contractors. It would be a long list! We do have a company diagnosis checklist, so if a company has issues they can visit our website and see examples of areas where we can help. Of course, any inquiries are treated in the strictest confidence, and we would be pleased to hear of new requirements.


Q11: What industries do you work with?

We cover all sorts of industries. The consultants are accounting and finance professionals that is our existing focus. We are in the business of providing skilled people for the accounting & finance sector in all industries. Our contractors are flexible, adaptable and are quick to learn. For example, if they have worked in the pharmaceutical sector they can, for example, adapt very quickly to healthcare.


Q12: So what was the special deal you mentioned at the start of our talk?

I can confirm that a company can try the consultant for one week. If the company does not wish to continue, they are not charged for the contractor. They can just sign up for one week and if they do not think the consultant can contribute, we will not continue the contract, and no charge is made.