7 top technology trends for CFOs that will shape the future: from Artificial Intelligence (AI) to strategic partnerships [Experts weigh in]
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In the last years, we have seen a new range of technology trends for CFOs and financial management. There has been so much discussion about cloud technology, artificial intelligence and the changing role of the CFO. There is little doubt that these topics will remain crucial in the financial world.
However, the experts who contributed to this article also have big expectations regarding some other developments. From artificial intelligence and automated accounting to business intelligence and the consolidation of the CFO as an strategic partner, the following are tech trends you should put on your watchlist, or implement right away.
There have been great expectations for AI over the last few years. In fact, some expected to see voice control and smart assistants like Alexa or Siri exploding in the workplace. However, AI is yet to be fully integrated into financial management. According to Mark Gandy, a consultant providing CFO services to small to medium-sized businesses at G3CFO, the financial field still needs to catch up.
โMarketing makes the most sense for now where AI can be used to spot trends and consumer behaviors. FP&A is where I hope to see AI being tested,โ says Gandy. Along those lines, some experts think that software robotics will be one of the preferred channels to test AI. For instance, Chris Bevelander, CFO and COO of DocWolves, believes that AI โapplied in writing robot reportsโ will be one of the most important tech trends in financial management.
Similarly, Heikki Siltanen, group business controller at at the Nordic construction company NCC, argues that robotics will become increasingly popular. Sale efforts of service providers, as well as the financial convenience that robots provide to large corporations, will boost that trend. โCFOs are required to make fast decisions regarding the adoption of new technologies. The experimentation with them has become the normโ, adds Siltanen.
One of the โnaturalโ outcomes of AI development is automation.
For instance, Ralph Wilson, CFO for marketing operations consultancy ICP and former Head of Finance for BBC Worldwide, expects to see โmore user-friendly and more automated accounting systemsโ in the next few years. He also thinks that โautomated purchase and sales ledger transaction processing between clients and suppliersโ will play a big role.
For Ignacio Rubio, CFO of the online media company T2O Media, technology for process automation will have the strongest impact in financial management. โCRM and financials software are more powerful, and large media platforms are increasingly automated to simplify all types of transactions (collections, payments, accounting, blocking of certain banking transactions, etc.). These automations allow for the streamlining of internal processes and focus on providing greater value in the organization.โ
Bevelander and Siltanen also think that automation will be key in the future. While Bevelander believes that โintegration and large scale application of automatic processing of digital invoices and further digitizing invoicesโ will have a major impact on financial management, Siltanen sees โmore automation in AR/AP and bookkeeping.โ
For some, the adoption of this technology will change the face of the financial field. John Orlando, executive vice president and CFO of the budgeting company Centage, highlights one of the benefits. Thanks to the adoption of these kinds of automated tools, finance departments will โbecome more focused on developing and evaluating key strategies,โ argues Orlando.
Not long ago, Jeffrey Thomson, president and CEO of the Institute of Management Accountants (IMA), made several predictions about what CFOs can expect in the future. One was that, โfinance will become increasingly dependent on automation and analytics to deliver real-time, clear, actionable and forward-looking insights.โ According to the experts we spoke with, this trend will define financial management for years to come.
In this regard, Jose Li, CEO and Founder of the Fort Lauderdale-based company 71lbs.com, told us how โaccess to vast sources of information on the cloud and in real-timeโ has shaped the way CFOs operate. Furthermore, he thinks that the โability to view unit economics (e.g. CAC, LTV) in real timeโ could be the most important CFO tech trend in the years to come. In fact, donโt be surprised if real-time insights become the most discussed subject in financial management.
CFOs will have new and improved tools to help them standardize and provide quick access to data. As a result, data visualization will represent โa big advantage and a great tool in the decision making process for financial processes, in particularโ argues Vanessa Goscinny, former finance director for the Open Society Foundations in Haiti.
Similarly, Miguel Losada, former finance director for the product development company Inspiralia, foresees a new reality full of possibilities for CFOs. The ability to manage data โin short periods of time is going to be unimaginable. Making financial decisions under simulation scenarios could place us in another kind of reality completely different from the current one,โ says Losada.
Furthermore, Losada imagines big data playing a major role in financial security. โBig data offers opportunities that will allow us to know our clients and providers much better,โ argues Losada. He also sees it as a helping hand when it comes to meeting criminal compliance challenges.
Besides big data, Losada reports that data management will be affected by the popularity of business intelligence. In fact, he thinks that business intelligence for finance will gain importance thanks to its ability to integrate different kinds of software within an organization. Bevelander shares that point of view, and expects โbusiness intelligence for powerful data analysis of large amounts of customer behavior dataโ to be one of the top three technology trends in financial management in the near future.
Along those lines, Jorge Garcia, VP Finance โ CFO of Tiendas D1, Colombiaโs largest hard discounter, highlights the impact that big data will have in the future, especially when it comes to Business Intelligence. โBusiness Intelligence apps based on big data will allow us to properly identify opportunities and new trends in the market,โ affirms Garcia.
According to Goscinny, โcloud based applications and devices will continue to strongly influence the way organizations work,โ which she sees as relevant in terms of collaborative working and access to data from anywhere in real time.
Garcia also believes that the integration of cloud computing, big data and AI will play a crucial role in financial management. That kind of integration, โwill allow CFOs and top executives to have access to reliable and tailor-made information that will significantly improve the decision-making process,โ says Garcia.
Thanks to the ongoing cloud trend, Bevelander predicts that the mobility that defines the virtual office will further be reinforced. Likewise, he expects โmore integration of systems allowing more people in the organization to have more available information.โ
โTechnology has forced CFOs to expand their expertise beyond accounting and finance,โ affirms Siltanen. According to Michele Zangri, vice president of operations and CFO for Unit 4 in North America, โmodern technology has played a big hand if not the entire handโ in the evolution of finance roles. With all the ongoing digital disruption in AI, automation, real-time data and cloud technology, the role of the CFO will inevitably continue to evolve.
Part of that evolution includes CFOs engaging in tasks that are highly influenced by new technology. โWe will have to learn how to analyze data in real-time, how to detect future risks for our companies, where to find data, and especially how to add value to that data,โ adds Losada.
Adopting the technology necessary to carry out these tasks will be an essential ingredient of this trend. However, we are not just talking about financial technology. In fact, Jorge Garcia argues for the importance of adopting technology that goes beyond the financial sphere. The modern CFO needs โto have a broad knowledge of the impact that technology has on business, clients, shareholders, entities, stakeholders, the environment and society as a whole.โ
This includes a new focus that the CFO will need to gain within the organization overall. A new focus โaway from the mechanics of producing reports, and more towards value-add commercial work,โ states Ralph Wilson.
From now on, CFOs will be more involved in the strategic aspects of their companies. As stated by Losada, todayโs digital CFO is aware and understands the strategy of the company. The modern CFO not only enables corporate change, but also helps the company to achieve its goals. This strategic role will significantly increase in the years to come.
Security has become a top priority, which means weโll see more CFOs investing heavily in technology aimed at protecting their businesses. Considering the vulnerability of the current environment, developments in cybersecurity will be crucial. โPreventing attacks on your business is key to guaranteeing and offering security to customers. Protecting your data is essential in current times, where there are more and more cases of greater cyber attacks,โ explains Rubio.
The need for security related applications and hardware will play a major role in financial management. โBecause data can be accessed from anywhere, they have to be secured, especially when it comes to sensitive financial information,โ argues Goscinny. She strongly believes that security will shape the technological focus of financial management in the coming years. Itโs the CFOโs responsibility to work alongside IT experts in their teams to understand all of the security requisites. Here you can see a real example of web technology security taken seriously.
Apart from these seven trends, there are others worth mentioning. Ralph Wilson, for example, argues that core accounting functions will be moving from business units to centralized offshore specialist providers. He also feels that the adoption of new modern reporting packages will improve โuser-friendly KPI and dashboard reporting.โ
Besides access to unit economics in real-time, Jose Li stresses the importance of comparing and benchmarking technology. โComparing and benchmarking information with your current financials, or with competitorโs financials, gives a different dimension not seen beforeโ, argues Li. Benchmarking and comparison technology will be instrumental in the next few years.
Finally, Gandy hopes to see the integration of blockchain and virtual reality into financial management. He also wonders how virtual reality can be integrated into top finance organizations globally. โI see new and emerging innovations throughout the sales process. Finance? Not sure. Letโs see what happensโ, concludes Gandy.
If we look carefully, two things connect all of the previously mentioned trends. First, linearity. How can you talk about AI without touching on automation or real-time insights? How can you discuss the changing role of the CFO without saying anything about cloud technology in financial management?
Second, evolution (vs. sudden disruption). All of these trends are extensions of things that have been occurring for some time. AI, automation and cloud technology are trendy now, and will probably continue into the future. โThese trends have been developing for some time now and most of them will only be stronger in the future,โ states Goscinny. In other words, we are facing trends that will affect financial management in the long run.
So there you have it. Are you a CFO or finance-related professional? Do you agree with the trends outlined by these experts? Is there anything we didnโt say that you see as a potential trend for the future? We would be happy to hear your thoughts and include them in upcoming articles.
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Photo by G. Crescoli on Unsplash
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