What experts are saying the top business finance trends will be for the upcoming year may sound familiar.
They’re worth highlighting because companies that are able to adapt to these finance trends are most likely to be well-positioned for success in the years to come.
Finance trend #1: Digital transformation and automation
Naturally, managing cash flow and cost analysis and reduction will be top priorities for CFOs in the coming year. But so will adopting new technologies and digital transformation, Tipalti Vice President of Finance Alex Cedro said during a recent IOFM webinar.
“CFOs are really keyed in on those areas that can really sustain and drive the business, going forward. And in (order) to do that, you need automation. … (Finance teams need) those capabilities to be able to have visibility into where the cash is going, where the spend is, and to be able to forecast quarters out, months out,” he said.
Technology will continue to streamline the repetitive tasks in Finance – including consolidating entities and closing the books – freeing up team members for higher-level moves like financial modeling and strategic data analysis.
An investment in training and development may be necessary to help staffers become skilled in financial modeling and strategic data analysis. Nearly half of finance leaders (49%) told AvidXchange that digital upskilling and reskilling were part of their plans.
Look for cloud-based financial management systems to increase in popularity, enabling collaboration across teams and providing real-time access to data. A key reason to be doing more on the cloud: Survey data from MineralTree’s eighth annual State of A/P Report indicates that 72% of all A/P departments will be either fully remote or working a hybrid schedule a year from now.
“A/P automation will not only allow remote or hybrid teams to be more efficient, but will also allow the business to scale without having to add additional headcount,” said MineralTree Vice President of Sales Sera Chowdhury during the on-demand ResourcefulFinancePro webinar “2023 State of A/P: Key Learnings for 2024.”
Less face-to-face contact with remote and hybrid workforces also means it’ll be essential to have tech tools for tracking employee spending and ensuring compliance with company policies to prevent maverick spend.
Finance trend #2: The coming of age for AI
This could be the year that AI makes such a difference across more sectors and companies that it’s impossible to ignore. Your finance pros may need upskilling or reskilling to keep up.
Cloud financial management software provider Sage foresees AI-powered financial planning and analysis tools becoming integrated into accounting automation platforms, linked with more business applications, and playing a crucial role in managing risks and modeling scenarios in 2024.
“If you just come in with one plan, and without any sort of contingency or ‘what-ifs,’ that may be hard … as you’re going through the quarter and you start seeing things that may not be coming out as projected,” Cedro commented.
In addition, look for AI to be deployed more often to automate tasks like fraud detection, investment management, risk assessment and tax compliance checks.
Generative AI‘s star is rising because of its potential to supercharge productivity in Finance and beyond. Generative AI tools can expedite tasks like writing financial reports, refining marketing materials, generating legal documents and more.
Deloitte reportedly is using it to prevent layoffs by evaluating existing staffers’ skills and mapping out possible career paths.
The downside of AI, however, is crooks will also try to use it to steal from your company. The potential for AI-driven phishing attacks is a threat that may necessitate an increased investment in protective measures and insurance against cybercrime.
Finance trend #3: Breakout year for real-time payments
Another prediction Chowdhury has for 2024: “There will be a large shift toward digital payments with the goal of improved vendor relationships.”
Notably, this includes more real-time payments, which are transforming the financial industry and traditional banking models by enabling immediate transaction processing and settlement. Eighty-one percent of AvidXchange survey respondents said they’ve seen an increase in requests from vendors for real-time payments.
“They want to get paid quicker. They want to ensure that, for their offering, they’re able to control their costs as well,” Chowdhury commented.
In addition, banks with a spirit of innovation may start exploring services built on top of instant payment systems, such as account-to-account payments, real-time bill payments and request to pay functionality. These services can provide companies with more efficient and convenient ways to manage their finances.
Finance trend #4: Inflation back under control?
If this rings true, capital expenditures that had been on hold could finally get moved off the back burner.
Finance trend #5: Renewed chatter about blockchain and crypto
We’ll see more cryptocurrency regulation in 2024, according to Sage, but crypto will remain outside the mainstream of investing until regulatory measures are perceived as effective and firmly in place.
Meanwhile, the security, transparency and recordkeeping advantages of blockchain technology will gain traction as it’s utilized in contract management, supply chain financing and fraud prevention software applications. For example, imagine a “smart contract” that automatically enforces agreements.