The war for talent is real! How can your audit department get ahead? Stacey Schabel, VP & Chief Audit Executive at Jackson and North American Internal Audit Director at Prudential Assurance, and Sarah Saunders, AVP of Internal Audit at Jackson, share 5 ways to transform your audit team to attract, develop, and retain the best talent and add significant value to your organization.
With technology and enterprise operations changing at an ever-increasing rate, internal audit can no longer rely solely on traditional approaches to recruiting, development, and project management. To provide the right assurance over an organization in today’s volatile conditions, internal audit teams must diversify their member expertise to speak to new risk areas, rethink their departmental structure to facilitate agility, and provide new assurance products to meet the organization’s evolving needs. In this article, we share 5 ways to make your internal audit department a more high-performing, dynamic, interesting, and attractive place for talented people to grow.
1. Develop a Broad Talent Pipeline to Build a Diverse Team of Area Experts
To give internal audit the agility to respond quickly to evolving business risks, it’s crucial to assemble a team with diverse subject matter expertise. A traditional approach to recruiting audit department talent might limit itself to Big 4 public accounting external hires. By moving beyond this singular view of an auditor’s background, you’ll bring in a mix of people with the acumen and business expertise to effectively audit different areas of the business.
Look for internal hires across the organization who bring valuable knowledge about business operations that can be supplemented with audit training. Broaden your pipeline to include external hires with technical expertise in key risk areas like IT and financial risk. A diverse team is a rich environment for development, and will be prepared to respond effectively to evolving business risks.
2. Motivate and Uplevel Current Talent
Of course, building a successful team isn’t just about pipeline — it’s also about retaining and motivating individuals by making your department an inspiring place to grow professionally. A transformed and transformative audit department will take auditors who bring strong audit skillsets, and create opportunities for them to develop their business and technical expertise.
As you build a team with a diverse array of skillsets performing interesting projects, you’ll find that internal audit becomes a place people look forward to working in — and a feeder of talent into the organization. There are clear challenges that accompany being seen as a source of top talent, but you’ll find that it’s also easier to recruit people to join a high-functioning team whose members’ talent is being utilized to the fullest.
3. Create an Agile Departmental Structure
Our audit department at Jackson recently restructured to become more agile by creating areas of focus within internal audit. In each focus area, we worked with our HR department to create internal subject matter expert roles filled by high-level individuals who are given time to hone their technical expertise in their target area.
Now, rather than hire consultants to get that expertise, the team benefits from having internal SMEs who engage with our peer companies, learn best practices, keep up on thought leadership, and bring all that value back to the business. For each audit project, the department has the flexibility to assemble a team with individuals from different focus areas who bring the right skills for that project. As the organization and external conditions change, this agile structure enables internal audit to provide coverage for new and emerging risks.
4. Provide Insight and Foresight with an Evolving Selection of Assurance Products
To keep up with changes to the risk landscape and how the business is operating, internal audit should move beyond providing assessments in hindsight to develop additional audit products and reports that provide insight and foresight over key organizational risks. Along with more traditional full and limited scope audits, consider creating value-add assurance products that provide real-time perspective to help the organization implement new strategies more efficiently and effectively. Three examples that have been popular with our stakeholders:
- Real-Time Engagement: Internal audit works alongside key stakeholders as key change initiatives are occurring within the business to ensure that the right assurance is being communicated to the committees and management.
- Program Assurance: A product designed to look at key activities, controls, and program management activities that support the achievement of a key transformation. For instance, when new regulations come down the line, internal audit provides real-time, independent assurance that the people and processes are in place to satisfy compliance.
- Defined Procedures: Internal audit provides a view on targeted risk areas with defined procedures such as regulatory requests or a business requests.
Along with adding more value to the organization, upscaling the insight and foresight that your audit department provides creates more challenging and engaging projects for your team members work on — key for attracting, retaining, and motivating talent.
5. Target the Characteristics of a High-Functioning Audit Team
A great way to start creating a more high-functioning department is to focus on upleveling key characteristics across your team. We’ve listed six characteristics that are deeply interrelated, and you’ll find that making progress on one tends to have ripple effects to others.
- Honest Communication: Being forthright and authentic in your communication — about, for instance, how pay aligns with the industry or other topics people tend to avoid — can inspire team members by showing that the leadership is looking out for their best interests.
- Clear Expectations: An important element of our team’s transformation came from making the transparent decision to raise the bar as a department. Setting clear expectations for quality of work will help retain valuable employees who already hold themselves to a high standard, and who may grow frustrated when they consistently contribute more than others.
- Authentic Leadership: Be approachable, authentic, and honest — and this doesn’t just apply to the head of audit. This applies to how team members lead on projects, with people development, and when audit takes on a leadership role within the business in anticipating and safeguarding against organizational risk.
- Opportunities for Growth: Empowering someone’s growth requires that a leader understand what makes a person tick — what excites them and where they want to go. By investing the time to learn about each individual’s interests and goals, you’ll be able to identify engaging projects that will help your team members develop their full potential.
- Challenging Projects: This goes hand in hand with professional development — if your team doesn’t have any interesting audits coming up, you’ve got a problem! Challenging projects are often linked with providing more value to the business, so search out opportunities for internal audit to engage with strategic initiatives.
- Collaboration: To increase collaboration, we made it a yearly goal with measurable outcomes that drives our team’s performance review and pay. Along with creating a better-functioning department, investing in collaboration also provides excellent leadership development experience to prepare auditors to work with many different types of personalities across the organization.
These characteristics aren’t something to set and forget. You’ve got to continually assess whether your team has the characteristics to hold itself accountable to a higher standard, and if some are lacking, develop an enhancement plan to cultivate them.
Audit team transformation won’t take place overnight. You’ll need to evaluate how much transformation your team needs, and put a plan in place to raise the bar for team standards. By expanding your pipeline, upleveling current talent, facilitating departmental agility, developing interesting value-add assurance projects, and targeting key team characteristics, you’ll work toward building a department of high performers who are excelling in their careers, in the team, and are adding value to the organization. When you assemble a diverse team of skilled members and grow their talent to be valuable for the overall business, you’ll be in a strong position to win the talent war!