Last year, we heard several things regarding technology trends for CFOs and financial management. There were, indeed, lots of discussions about cloud technology, artificial intelligence and the changing role of the CFO. There is little doubt that some of those topics will remain crucial this year.
However, the experts who contributed to this article have big expectations regarding very specific developments. From artificial intelligence and automated accounting to business intelligence and the consolidation of the CFO as an strategic partner, the following are the tech trends you should put on your watchlist or implement right away.
6 Technology Trends for CFOS in 2018: What’s at stake?
1. A real test for Artificial Intelligence (AI)
There were big expectations for AI in 2017. In fact, some people expected to see voice control and smart assistants like Alexa or Siri exploding in the workplace. However, AI hasn’t been fully integrated into financial management yet. According to Mark Gandy, a consultant providing CFO services for small to medium-sized businesses at G3CFO, the financial field still needs to catch up with that.
“Marketing 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 through 2018” says Mr. Gandy. Along those lines, some experts think that software robotics will be one of the preferred channels to test AI in 2108. For instance, Chris Bevelander, CFO and COO of the company DocWolves, believes that AI “applied in writing robot reports” will be one of this year’s most important tech trends in financial management.
There is no doubt that AI will be a big deal in 2018. A recent survey of 235 business executives carried out by Narrative Science found that 38% of companies are already using AI and 62% will use AI technologies by 2018.
2. Automated accounting and transactions gain momentum
One of the ‘natural’ outcomes that comes with the development of AI is automation. Some experts think that 2018 will be the year where automated accounting will flourish. For instance, Ralph Wilson, Group Finance Director for reach4entertainment enterprises and former Head of Finance for BBC Worldwide, expects to see “more user-friendly and more automated accounting systems” this year. He also thinks that “automated purchase and sales ledger transaction processing between clients and suppliers” will play a big role in the upcoming months.
Similarly, Chris Bevelander believes that “integration and large scale application of automatic processing of digital invoices and further digitising invoices” will have a major impact in financial management. In fact, the adoption of this kind of technology will change the face of the financial field. According to John Orlando, Executive Vice President and CFO of the budgeting company Centage, one of the benefits that comes with the adoption of these kinds of automated tools is that finance departments will “become more focused on developing and evaluating key strategies.”
3. Real-time insights (will) become essential
Last year, Jeff Thomson, an expert in CFO matters, wrote an article in Forbes Magazine predicting several things for 2017. One of his predictions was the following: “finance will become increasingly dependent on automation and analytics to deliver real-time, clear actionable and forward-looking insights.” According to the group of experts who contributed to this article, this is one of those trends that will maintain its appeal throughout all of 2018.
To this regard, Jose Li, CEO and Founder of the Fort Lauderdale-based company 71lbs.com, reported us how “access to vast sources of information on the cloud and in real-time” has shaped the way CFOs operate today. Furthermore, he thinks that the “ability to view unit economics (e.g. CAC, LTV) in real time” could be the most important CFO tech trend of 2018. In fact, don’t be surprised if real-time insights becomes the most discussed subject during the upcoming months.
4. Better decisions through data management and business intelligence
In 2018, CFOs will have new and improved tools that will help them to standardise and provide quick access to data. As a result of that, data visualisation will represent “a big advantage and a great tool in the decision making process for financial processes, in particular” argues Vanessa Goscinny, Finance Director for the Open Society Foundations in Haiti.
Similarly, Miguel Losada, Finance Director for the product development company Inspiralia, foresees a new reality where CFOs will be face with all kinds of possibilities. The ability to manage data “in 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” said Losada.
Furthermore, Losada sees big data as something that will play a major role in terms of financial security. “Big data offers opportunities that will allow us to know much better our clients and providers,” argues Losada, who sees big data as a helping hand when it comes to meet criminal compliance challenges.
Besides big data, Losada also reported us that data management will be affected by the popularity of business intelligence. In fact, he thinks that business intelligence for finance will gain importance in 2018 thanks to its ability to integrate different kinds of software within the organization. Chris Bevelander, who also shares that point of view, expects “business intelligence for powerful data analysis of large amounts of customer behavior data” to be one of the top three technology trends in financial management for 2018.
5. Further (and better) integration through cloud technology
According to Vanessa Goscinny, “cloud based applications and devices, will continue to strongly influence the way organizations work,” something she sees quite relevant in terms of collaborative working and access to data and other information from anywhere in real time.
Thanks to this on-going cloud trend, Chris Bevelander also believes that 2018 will further reinforce the mobility feature that defines the virtual office. Likewise, he also expects “more integration of systems allowing more people in the organization to have more available information.”
As far as financial management goes, cloud-based solutions (vs all-in-one software) are here to stay for the long run. As a matter of fact, making a reference to a research published by Bain, Roy Golden, CFO at Zerto, recently stated in cfo.com that the global cloud market is expected to grow to $ 390 billion by 2020.
“Cloud computing is one of the biggest tech trends in a generation… and one of the biggest areas of impact is how it presents a new landscape for chief financial officers to work within”
6. A more strategic focus for a digital CFO
According to Michele Zangri, Vice-President of Operations and CFO for Unit 4 in North America, “modern technology has played a big hand if no the entire hand” in the evolution of finance roles. With all the on-going digital disruption in AI, automation, real-time data and cloud technology, the role of the chief financial officer will inevitable continue to evolve throughout 2018.
This year, we will continue to see that evolution with more CFOs engaging in a whole variety of tasks highly influenced by new technology. “We 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” advanced Miguel Losada.
Adopting new technology to carry out all these new tasks will be an important ingredient of this trend. However, the crucial part of it relies on the new focus that the CFO will gain within the overall organization. According to Ralph Wilson, the development of more automated accounting systems will result in a new focus “away from the mechanics of producing reports, and more towards value-add commercial work.”
In 2018, CFOs will be more involved with the strategic aspects of their companies. As stated by Miguel Losada, todays’ digital CFO is aware and understands the strategy of the company, becoming not only a figure capable of enabling corporate change but also a key piece in the achievements of the goals of the company. This strategic role will significantly increase in the next twelve months.
Additional trends: offshore, security and…blockchains!
Apart from these 6 trends,, there are some others that are worth mentioning. Ralph Wilson, for example, argues that core accounting functions will be moving from business units to centralized offshore specialist providers. He also thinks that 2018 will be guided by the adoption of new modern reporting packages that will improve “user-friendly KPI and dashboard reporting.”
The need for security related applications and hardware is another issue that will play a major role in financial management this year. “Because data can be accessed from anywhere, they have to be secured, specially when it comes to sensitive financial information,” argues Vanessa Goscinny, who thinks security concerns will shape a big chunk of the technological focus in financial management during 2018. It’s the CFO responsibility to work along with IT experts in their teams to understand all the security requisites that must be requisites, you can see a real example of web technology security taken seriously.
Besides access to unit economics in real-time, Jose Li also stresses the importance of comparing and benchmarking technology. “Comparing and benchmarking information with your current financials, or with competitor’s financials, gives a different dimension not seen before”, argues Li. Benchmarking and comparison technology will play a big role this year.
Finally, Mark Gandy hopes to see the integration of blockchain and virtual reality into financial management. In fact, he hopes 2018 is the year where blockchain will be integrated throughout major ERP platforms. He also wonders about how virtual reality can be integrated into the top finance organizations globally. “I see new and emerging innovations throughout the sales process. Finance? Not sure. Let’s see what happens in 2018”, concludes Gandy.
Tech Trends for the Next Gen CFO: Going for the long run
If we look carefully, there are two things that bond together all the trends we mentioned before. First of all, linearity. How can you talk about AI without touching automation or real-time insights? Likewise, it would be difficult to have a discussion about the changing role of the CFO without mentioning, at least briefly, the impact that cloud technology has had 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 they will probably be trendy this year or even five years from now. As stated by Vanessa Goscinny, “these trends have been developing for some time now and most of them will only be stronger in the future”. In other words, we are facing a group of CFO tech 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 didn’t say that you see as a potential trend for this year? We would be happy to hear your thoughts about it and include them in upcoming articles.
Photo by G. Crescoli on Unsplash