Technology

Technology Trends for CFOs to Watch in 2017


by FEI Daily Staff

The office of finance is changing at a rapid pace, and technology is set to have a significant impact on the role over the coming year.

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This year has been a breakthrough year for voice recognition, chatbots and artificial intelligence with companies across the board talking about the potential for these technologies to revolutionize homes, schools and workplaces. Looking ahead, 2017 will see the CFO become laser-focused on the customer experience (and subscription renewals) and settle into new service business models, while at the same time wrestling with the new revenue recognition standards to meet the January 2018 deadline.

As 2016 draws to a close, here are six technology trends for CFOs to watch in 2017:

The services economy will become “THE Economy”

In 2017, more than half of all companies will be based entirely on services-related revenues, and approximately 90 percent of businesses will earn more than half of their revenue from services, which include professional services, subscription-based services, service-level agreements, managed services and usage-based contracts.

The shift to services and the importance of subscription renewals in 2017 will place a greater emphasis on customer experience, making it critical that CFOs become more engaged in customer satisfaction, retention, and renewals, as well as product development. The acceleration of the services economy will begin to reshape the Fortune 500, and businesses that are underprepared for the changing business model will be overtaken by more forward-looking organizations.

CFOs get hands-on with customer experience

As businesses increasingly shift from product and single transaction sales to service and subscription models, CFOs will be thrust out of the back office and into active customer-facing roles. To support this shift, successful software companies will be required to deliver tools that consolidate billing sources, support and automate new revenue models, and provide end-to-end visibility across the customer lifecycle.

Revenue recognition will drive CFO technology adoption

At the same time, the new revenue recognition accounting standards will further drive CFOs dependence on cloud technology. In the same way that FATCA (Foreign Account Tax Compliance Act) drove financial institutions to adopt secure managed file transfer technology, the new revenue recognition standards (IFRS 15 and ASC 606) - which are designed to improve statement comparability and reduce complexity - will prompt the next wave of technology upgrades and drive more companies to migrate to the cloud.

Smart assistants break out of the echo chamber

Voice control will explode in the workplace in 2017, with smart assistants like Cortana, Alexa, and Siri finding new ways to take business action on voice inputs. Thanks to powerful artificial intelligence and voice recognition frameworks, clever developers now have the tools to develop systems that check the status of project deliverables, run reports and respond to business information through simple voice commands, creating ‘digital assistants’ that will inevitably find their place in the enterprise. We’ve already seen a couple of use cases with Atlassian launching a HipChat Alexa integration to enable developers to make changes to code and address issues with websites using voice commands. FinancialForce also showcased an Alexa enterprise resource planning assistant at Dreamforce 2016.

Software will need to do more than just log data

The days of entering data into business applications and then exporting a pdf for insight are over. The bar has been raised and SaaS applications are now expected to have analytics and intelligence baked in to enable real-time, actionable insights. In 2017 business intelligence services will empower CFOs with previously unseen visibility into every dollar recognized and dollar planned, and allow for critical decisions in an informed and predictable manner. New systems will meet user demand for detailed business optics, billing forecasting, and revenue tracking. Business users will also demand their applications automate cumbersome workflows and allow real time answers, collaboration, and data-driven decision making.

Planning for global instability

With the incoming Trump administration and uncertainty around the trade, business leaders must prepare for four years of both domestic and international instability. Politically, many should start planning to ensure preparedness for regulatory uncertainty and protectionism. If your company specifically manufactures abroad, you’ll want to start shoring up trade deals with overseas contracts. CFOs and their finance offices will need to be ready to analyze and prepare for whatever impact political, economic and societal events may have on their organization. This is where business intelligence software and services become a priority, as finance teams need to have predictive algorithms and tools that can better equip them for strategic planning. The right tools will give finance departments real-time information, leading to smart, nuanced and nimble decisions.

The days of managing finances on an Excel spreadsheet are drawing to a close and we stand at the precipice of the cognitive computing, cloud era. It’s an exciting time to be a CFO. The office of finance is changing at a rapid pace, and technology is set to have a significant impact on the role over the coming year. Smart CFOs should be thinking about how these trends will impact their business and how new technology can be applied to improve efficiency and customer visibility, and ensure compliance.

 

Kevin Roberts is Director of Platform Technology at FinancialForce.