The economy will continue to fluctuate next year, and that’ll be driven by interest rates, according to a webinar on 2023 Finance trends from Controllers Council.
Many of your peers agree that it’ll be a roller coaster ride because they’re not sure what’s going to happen next:
- 21% of the webinar’s attendees named braving economic uncertainty as a top priority in 2023 for their business.
- 27% of Finance pros polled in an IOFM webinar said helping their business navigate economic uncertainty will be one of next year’s biggest challenges and 34% said their departments have taken measures to prepare for a potential economic slowdown.
- A PwC Pulse Survey revealed 62% of your peers believe inflation will remain high into next year.
- A survey by Grant Thornton found that 64% of finance leaders think rate hikes will lead to a recession because rising interest rates tend to put downward pressure on the stock market.
Based on that, a hot trend among finance leaders will be deploying prudent spending strategies with reviews and approvals to keep more cash on hand, especially with interest rates making the cost of capital much higher.
Another 2023 finance trend prediction: Your peers will be exploring new workforce benefits, such as reconfiguring their office spaces and providing employees resources and technology that enable them to be more efficient and productive.
2023 Finance trend: transformation
Doing things the way they’ve historically been done at your organization may not be enough to stay competitive in 2023.
For example, digitally transforming the Finance department is expected to be top of mind for your peers in the new year. Experts predict that technologies, such as automation of A/R, expense management and financial close management, will continue to have a significant impact on the organizations that leverage them.
Adding new tech may create a need for another kind of transformation – talent upskilling, including how to work with the artificial intelligence (AI) and machine learning software you’ve put in charge of the mundane manual tasks that staffers used to do. This can enable your Finance team to take on more strategic advisory roles (e.g., A/P performing more data analysis and less data entry as paper-based processes become digitized) and collaborate on projects with other departments across the organization, as well as external stakeholders.
When the Controllers Council webinar attendees were asked how their businesses were achieving their “finance agility” goals:
- almost half (48%) said continuous learning
- 27% said taking on new strategic assignments
- 21% said expanding role requirements, and
- 4% said something else.
Companies will likely look to their CFO to come up with the framework for the necessary research, training and support to get an upskilling initiative going.
2023 Finance trend: emerging technology
Another prediction for 2023: As more applications move to the cloud, Finance will need to embrace intelligent, data-centric fintech applications with built-in contextual intelligence. This includes smart systems technologies – revolutionary tool sets with advanced machine learning software capable of making autonomous decisions and performing a variety of business tasks.
The ResourcefulFinancePro webinar “A Look Back and Forward – A Finance Retrospective and a Crystal Ball Reading” named applications that are quickly moving from the theoretical to reality:
- conversational AI that can, for example, automate shared inboxes used for communicating with customers
- machines that understand human spoken communication
- “intent and sentiment interpretation and action taking”
- threat analysis and remediation that not only responds to cyberattacks, but also geo-political threats to your business, natural disasters and economic scenarios like supply chain disruption, and
- optical character recognition with computer vision enhancement for automating document processing.
You might also start hearing about businesses turning to hyperautomation – a strategy of rapidly identifying, vetting and automating as many business and IT processes as possible – to promote resilience in times of economic uncertainty.
What’s going to happen in A/P?
An IOFM webinar on 2023 Finance trends in A/P made these predictions:
- A/P managers will need to address evolving to new operating models, including automation, AI and/or tech-enabled managed services, to maintain productivity during times of high turnover.
- Touch-free P2P processing will gain traction because it means fewer errors and exceptions, faster cycle times and lower costs.
- There’ll be more automation of companies’ vendor management processes. It reduces the time spent tracking down missing vendor information and the risk of IRS fines for mishandling vendor info. In addition, this tech increases visibility into spend yields and monitors supplier compliance.
- More organizations are going to be extending their payment terms via supply chain financing. A supply chain financing network enables suppliers to get paid faster while letting buyers hold onto their cash longer, protecting the goodwill of the buyer-supplier relationship.
Mark Brousseau, president of Brousseau & Associates and a thought leader on A/P, A/R, payments and document automation, made these suggestions to A/P managers during the webinar:
- Come up with a plan to make posting of invoices to your enterprise resource planning system touch-free. (It’ll probably require an automation solution.)
- Seek out tools that streamline supplier management, and
- Re-evaluate your supplier payment terms. “Don’t leave this to somebody in treasury or cash management,” Brousseau commented.
