Calling All Cost Accountants: Should Your Job Description Include Creativity?

Aug 29, 2013

I attended a presentation at the National IMA conference in 2013 by Josh Linkner titled “Unleashing your Creativity”. Clearly he did not know what he was trying to attempt when addressing a HUGE room full of accountants. You know the stereotype: accountants are boring and definitely not creative! One of his course objectives was to educate us on how “to apply focused creativity to specific business problems of all sizes and shapes and avoid costly mistakes of flawed idea selection and measurement.”

He had some fascinating stories, but I found the following quote left me with the most to ponder: “Sometimes you have to turn it upside down to get it right side up”. I took that to mean dump it all out and start from scratch. In cost accounting, this is drastic, but it is often what it takes.

creativityI recently performed an operations review for a new client related to their accounting function and as a pleasant by-product, I discovered they were using excel spreadsheets (SHOCKER!) to cost their products and for quoting/estimating purposes. This is nothing unusual, however, as I got further into the details of the spreadsheets, I discovered that the data they were using was pretty much useless. It was based on information from 2011 and it was neither complete nor accurate. In addition, everything in the model was based on manual input and the potential for errors was astronomical. These were just some of the glaring issues, the calculations themselves were not even necessarily logical or correct.

For many other reasons, my reputation remains intact and the individual performing the task is no longer with the Company. We approached others within the company and explained the predicament. In a nutshell, we do not have any worthy costing data and we need to be able to accurately price new work for 3-5 jobs each day. Can you do it? Quickly?

Ten days later, it was done. An individual within the Company completely scrapped the model that was being used and started from scratch. In addition, further investigation is being done into why the software was not being utilized and how that can be corrected for the long-term.

This individual was able to apply her specific creativity to the business problem well outside of her “comfort range”. In doing so, she was able to avoid the flawed ideas of her predecessor and create a model for management that is simple, logical, and provides what is needed BASED ON ACCURATE DATA. It does not have to be a million dollar project, it just needs to be led by the right people! So in answer to the opening question, YES, your job description should included creativity.

Categories: Cost Accounting