When it Comes to Finance, the Future Really is Now
2020, 2021, 2023, 2025, 202’x’
In terms of years, they’re right here, right now – or just about to be.
In terms of predictive milestones, they’re also high usage rate harbingers for the future of finance if you study your valued reports and analysts.
While the year 2020 really did a number – disruption-wise – to the regular ole’ garden variety wave of disruption within corporate financial operations, the recent predictions we’re expected to face in these next few years would seem to hold true.
“Finance goes real-time,” one of the eight bold predictions from the 2018 report from Deloitte on the future of finance by 2025. “Periodic reporting will no longer drive operations and decisions – if it ever did.”
These days, we’re already in a world shaped by the availability of real-time financial reporting.
Another bit of foreshadowing in the Deloitte report is on operating models of business. The report acknowledges the coming emergence of new service-delivery models “as robots and algorithms join a more diverse finance workforce – think about the integration of freelancers, gig workers, and crowds. Companies will assess the benefits of automation against onshore and offshore operations.”
Offered up a little later and a lot sooner, by bold prediction standards, International Data Corporation (IDC), the global advisory service, in 2019 was bullish on the digital transformation trend, envisioning spending on the enabling technologies and services to reach $2.3 trillion by the year 2023. These findings were part of the firm’s ongoing digital transformation spending guide.
The COVID pandemic, of course, threw a bit of a wrench into that forecast. Consider: IDC’s mid-year estimate for 2020 spending to reach its $1.3 trillion target was based on about 10% year-over-year growth compared to nearly 18% growth the prior year. Regardless, digital transformation “remains one of the few bright spots in a year characterized by dramatic reductions in overall technology spending,” noted a Businesswire report in May 2020.
A 2017 survey from PricewaterhouseCoopers (PwC) didn’t hang a specific year on its future forecasting piece but did lean in heavily on emerging technologies in the finance world.
“CFOs must reach across the enterprise to act as a catalyst for innovation but many are hampered by fragmented, decentralized systems,” according to the accounting firm’s Global Digital IQ Survey. In the report based on that survey, nearly half (48%) of the responding CFOs acknowledged outdated technology as an emerging barrier to successful digital initiatives.
The same survey stated 40% of the CFO respondents highlighting data and technology integration as their biggest future challenge.
Those challenges may help to bolster the forecast in that 2019 IDC report of digital transformation technology investment spending to surpass $7 trillion between then and 2023.
“In the current competitive business world, digital transformation is the topmost strategic priority for every organization,” said Ashutosh Bisht, senior research manager for IDC’s Customer Insights & Analysis Group, in the report. “Nevertheless, the concept is confusing and intricate. Digital transformation involves managing the existing business and building for the future at the same time, something like changing the engine of the plane while in flight.”
Midway through 2020, and before the pandemic-forced world flip, Gartner highlighted a tidy 10 trends for CFOs to pay attention to as the future of finance, which remains noteworthy. Among those points: A forecasted fourth era for enterprise resource planning (ERP) which, for finance leaders, means being ready for standard global processes across organizations with real-time data and intelligent platforms.
Finance organizations, according to Gartner, will need to respond faster than ever before to continuous cloud-updated ERP and treat it as an organizational rather than an IT asset.
Gartner also brought attention to the growing use of global business services.
“Shared services as a concept has moved far beyond finance transaction processing and now includes value-added services in finance and beyond,” per the report. “Focus away from just cost reduction toward value delivery.”
As trends indicate, the predictive year associated with these forecasters is somewhat irrelevant, as the multitude of sameness in the discussion topics shows.
Various trusted sources are all saying variations on the same themes.
As noted in the Deloitte report, “in the years ahead, cloud-based ERP, automation, and cognitive innovation will continue apace, creating opportunities to radically simplify processes and free up people.”
The report notes the implication of finance somehow disappearing under “the crush of digital transformation” is wrong-headed thinking.
While finance may operationally become leaner headcount-wise, in areas including order-to-cash, Deloitte’s study suggests, the expectation for business finance will only grow exponentially when factoring in the possibilities for business partnering, reporting, planning, budgeting and forecasting.
Contact us today to learn how RecVue’s order-to-cash solutions can help you envision the immediate future and accelerate your organization’s digital transformation.