Digital transformation and leadership skills to boost dynamic business

Good leaders must embrace remote work, automation, and the Cloud, says Grant Thornton senior partner.

Hooi Kok Mun is the Senior Partner at Grant Thornton Malaysia who oversees the Audit & Assurance Department, focusing on delivering professional advice and services to all clients.

With more than three decades of expertise in assurance, listing, and business advisory work under his belt, Hooi is tasked with handling both international and Bursa Malaysia Securities-listed local companies in major industries such as property development, manufacturing, aquaculture, utilities, hotel, construction, and finance. He has also been involved in internal audits, due diligence reviews, and corporate exercises related to profit/cash flow forecasting and preparing Accountants Reports.

Apart from professional audit work, Hooi was an appointee of the Ministry of Finance as the Management Executive Committee where he administered a government troubled pipe company. He was also an appointed member of the Practice Review Program by the Malaysian Institute of Accountants (MIA) and the Issue Committee of the Malaysian Accounting Standards Board (MASB) and Audit and Assurance Standards Board (AASB). He currently represents MIA on the panel of audit licence interview.

As a judge in the Malaysia Management Excellence Awards, Hooi believes that digital transformation, business continuity capabilities, and empathetic leaders will usher companies toward greater success in the future.

In your opinion as an audit leader and an awards judge, how does digital transformation support management excellence and vice versa?

Digital transformation is very important given the rapid development and the speed of how business is conducted nowadays. With the ever-evolving market and customer expectations, businesses need to adapt and transform existing traditional and non-digital business processes and services to stay ahead of the game.  

The need for digital transformation is ever more apparent especially in the recent Covid-19 pandemic where almost all jurisdictions were locked down in order to prevent the virus from spreading. Now that we are into the second year of the epidemic, we have seen many businesses fail and yet some survived or even did better than their competitors. Businesses who thrive are the ones that have embraced digital transformations and remote working arrangements in their business and their operations managed to continue despite the on-going disruptions.

Digital transformation is also in line with the current pool of talents. The Millennials and Gen-Z are not only the largest demographic in the multi-generational workforce, they are also the first to grow up surrounded by digital technology—high-speed internet, smartphones, social media, mobile applications and many more. 

Having traditional work processes automated in the workplace eliminates the mundane nature of the tedious processes and brings about greater improvement to the employees that will increase motivation and productivity.

What do you see as today’s business challenges and how can leaders/management help their companies overcome these challenges and recover?

There are many challenges that businesses face today. Amongst them are;

1. Uncertain Future
2. Financial Management
3. Performance Monitoring
4. Regulation & Compliance
5. Talent Management

With all the disruptions caused by the COVID-19 pandemic, every business in the country and even the world will need to think of business continuity. Businesses need to build a robust digital transformation plan that facilitates business continuity. Leaders need to prioritise and identify which part of the business that they can automate. They should review what measures and systems can be put in place and assess whether they are sustainable on a new scale and for new ways of working that allow secure and efficient operations.

It is worth rethinking their information communication technology (ICT) investments considering agility and scale. When businesses think of capital investment in ICT, one of the many areas they should consider is having cloud infrastructure. A cloud-based ICT landscape will help businesses create a dynamic IT ecosystem that enables business continuity during and after the pandemic. 

Other investments to consider would be such collaboration platforms that support virtual working space where teams from various locations are able to collaborate and deliver. Besides that, they can also think of automation tools to enhance process efficiency and accuracy.

On the human aspect of handling various challenges faced by business, I believe that having a Crisis Management team is crucial. The team should consist of representatives from key departments or groups and meet frequently to discuss and prioritise problems. This is a ‘Hot planning’ group, consisting of leaders who think out of the box, that can react and find solutions to business problems as they emerge without tying up the whole management team. 

In these fast-changing times, what new skills should leaders/management acquire to steer their companies toward excellence?

Leaders should possess strong leadership skills premised on leading rather than instructing. Like the saying goes - A leader is one who knows the way, goes the way and shows the way. 

In this day and age, a leader must also be ready to embrace new technology and methods, and be prepared to move out from his or her “comfort zone”. With such rapid changes in the world, leaders who are resistant to change will only lose out. Be receptive, open to changes and along the way, accept constructive criticism and work on areas that are lacking. Indeed, learning is a lifelong journey.

As we all know, the pandemic has disrupted and challenged us in many ways. Our people have been placed under unprecedented stresses, affecting their emotions and mental health. With this, leaders have faced imperatives to be empathetic in their roles. Empathy is a valued leadership trait and leaders from Grant Thornton’s 2021 International Business Report (IBR) cited it among the most important leadership traits. 

As an empathetic leader, be aware of how your people are feeling as a result of the unprecedented changes, what they are going through and actively support them. When we understand and take care of our people, it benefits the company as a whole - talents are retained, team performance and productivity increases. 

What do you think are the skills and values that will be relevant to future audit, accounting and finance professionals?

Most definitely Information Technology skills. Artificial Intelligence is already being used in audit and also prediction technology. This is definitely the way forward for the future of audit. Many times when we conduct an audit, we are only auditing that company but we forget to look at the other factors affecting the business. In essence, we are auditing the tree while being ignorant of the jungle surrounding it. With artificial intelligence, we are able to observe the big picture which enhances the quality of our advice to our clients.

The possibilities and complexities brought on by the internet of things (IoT), cloud computing and big data, only served to excite the future of audit. But technology cannot replace professional judgement and scepticism in the audit reporting process. 

While we need to leverage technology more, there’s always going to be a human component in audit. Technology will allow us to extract specific at-risk transactions which we can then check in greater detail.

The fintech industry emerged in recent decades. What aspects of finance and accounting do you think will digitally evolve in the near future?

I see all aspects of traditional finance and accounting transactions/reporting to evolve. New sets of internal controls will be set up and new operating systems will be in place. A lot of the conventional and traditional way of processing will be phased out as we can see with the various banking transactions where customers are being encouraged to engage in e-banking.

How is financial technology impacting the delivery of regulatory requirements? Has it helped companies comply more easily or is it more burdensome?

It is seen as burdensome initially but eventually it will just be part of the system. This also would depend on what information regulators are asking for and how often they make new requests.