With the halfway point of 2017 rapidly approaching, we can look at what trends are on the horizon for CFOs for the remainder of this year and into 2018.
Many of the biggest trends focus around technology. That shouldn’t come as a big surprise. After all, it’s the increasing pace of data and automation that are becoming both major business drivers and disruptors at the same time.
In fact, a recent survey by Deloitte highlights just how many opportunities and challenges technology will bring:
“Sixty-three percent say that technology advances will change the products/services provided by their industry, and nearly as many (55%) say that technology advances will change how their industry operates.”
So we know changing technology is on the radar for the rest of 2017 (and beyond), but what else?
That’s a question many CFOs and budget managers are asking.
In this post I want to share some emerging trends that will dominate for the foreseeable future. The CFOs that are aware of and have a plan in place to capitalize on these trends will likely be ahead of the game as we enter 2018.
Productivity and workforce concerns are typically high on the list of things an organization needs to pay attention to. Unfortunately, many still struggle with both. As the workforce’s income demands increase, businesses look toward automation as a tool to increase productivity.
Automation is becoming more common due to technological advances. Digital tools for data collection, business budgeting, inventory and sales are commonly seen as the most effective way now to keep track of the overall health of an organization.
As more digital tools are used by businesses, departments can look to which processes can be automated. There are a few benefits to this, not the least of which is more room for business strategy. Having some core business processes automated can provide an opportunity for the finance department to become more focused on developing and evaluating key strategies.
Today many organizations cite agility as a key priority. They want to be able to face uncertainty and pivot quickly when potential challenges or opportunities arise. The agile organization is one that can mitigate risks over the long term.
Two areas where that focus on agility comes up again and again in 2017 is around budgeting and forecasting. These are two areas that CFOs and budget managers constantly cite in need of improvement. Yet many organizations still struggle with creating a budgeting and forecasting process that allows for better agility.
This is why many businesses are turning to rolling financial forecasts. Many CFOs and budget managers find this approach better prepares them to act on obstacles and opportunities. Rolling forecasts rely on using updated information (a quarter old or less) that more closely reflects current business conditions, thus helping to reduce risk.
The trend of the CFO playing a key role on the management team has been a strong one the last few years and will likely continue.
That means CFOs need to know more than just the income statement. They’re being called upon to understand all aspects of the business and be strong contributors to overall strategy. That includes aspects that aren’t directly related to just finance but to the overall organizational strategy.
Many organizations are also asking the CFO to look at non-financial data as key performance indicators (KPIs). This trend will continue as more businesses are better able to gather data from more areas, e.g., customer satisfaction rates. These non-financial KPIs can provide all sorts of valuable insights for financial forecasting and decision making.
Looking to the Future
As we roll towards 2018, there’s little doubt more trends will emerge.
However, one thing is for certain: the CFO will see the position adapted into one that needs to be able to embrace technology, agility and ever-increasing streams of big data.
The organizations that make the shift now will reap the benefits in the future.
Businesses of every description rely on the Budget Maestro™ family of software solutions by Centage Corporation to improve the efficiency and effectiveness of their business budgeting and planning, financial forecasting, financial consolidation and reporting processes. For more information, take a tour of Budget Maestro, contact Centage, or call 800-366-5111 now.