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Crunch time series for CFOs: Finance 2025 revisited

Let’s reassess our eight finance trend predictions

New finance trends sparked by digital disruption several years ago have only amplified with COVID-19. In 2018, we presented eight predictions on how the finance function will change by 2025. Our new Crunch time report revisits those predictions and where CFO trends and challenges stand today.

Finance faces new realities

COVID-19 sped up business innovation and stress-tested the concept of 100% remote work. Industries are converging, with global M&A activity in the first five months of 2021 reaching a record $2.4 trillion, and companies have raised more capital in the past year than at any time in recent memory. At the close of Q1 2021, nonfinancials in the S&P 500 held more than $2 trillion in cash reserves.

In 2018, as digital disruption was prompting its own new realities, we predicted eight finance trends in our Crunch time report, Finance 2025. Now that we’re halfway there (and everything’s changed), the time feels right to revisit those predictions and see where these trends stand today.

  1. The finance factory will focus increasingly on using big data, analytics and predictive modelling to inform business strategy and decisions. While few finance functions will have a truly touchless back office by 2025, mundane tasks will become easier to automate through ERP systems and other means, freeing up Finance to apply automation to planning, forecasting and other higher-value activities.
  2. The role of Finance: To bolster its capabilities, Finance will offload some responsibilities to captive locations, centres of excellence and outsourcing vendors, putting its support partners on the hook for performing under any circumstances. Technology will also help Finance handle uncertainty and execute on its value proposition as real-time information moves closer to reality and business analyses are generated on autopilot.
  3. Finance cycles: The demands of off-cycle reporting will accelerate as industries converge, new business models are created and the postpandemic economy addresses its supply chain, technology and workforce constraints. Finance will need to provide off-cycle insights while still delivering cyclical reports efficiently. Technology will help it do so, but getting the desired results won’t be a slam dunk.
  4. Self-service: The future of self-service is not about downloading more canned reports. It’s about push technology that knows what you need before you ask and visualisation tools that help you make sense of complex data. It also entails a common experience across delivery channels, enabled by the growing power of desktop systems and smartphones. Chatbots remain on the horizon, but are unlikely to be prevalent in Finance by 2025.
  5. Operating models: With a widely dispersed workforce, Finance will gain access to global talent pools and specialised resources. Finance also will make greater use of freelancers and gig workers. As businesses prize new capabilities, some CFOs will adopt the “centre-office” model, which emphasises end-to-end processes, capabilities on demand and co-ordination of external partner networks. In doing so, they’ll absorb responsibilities historically managed elsewhere.
  6. Enterprise resource planning (ERP): Big vendors will continue embedding advanced capabilities, bringing more data into the ERP footprint while dispatching threats to their business model. They’ll start adding blockchain to mitigate cyber risks, pushing distributed ledger technology deeper into finance operations and lowering its cost of implementation. Cloud-based financial ERPs will move from back-office cost centres to front-office drivers of business value.
  7. Data: Having bad data flow into automated AI systems won’t create efficiencies or result in practical business insights. To realise its digital transformation goals, Finance will need an enterprise data strategy with strong oversight. Finance will also need to sharpen its process and change management skills. Otherwise, workaround solutions will have to grow ever more complex.
  8. Workforce and workplace: Finance organisations will still need traditional finance and accounting skills. But they will also need workers with capabilities drawn from such areas as operations, technology and engineering. To get these workers, Finance will need to sharpen its value proposition and expand its sources of talent. People with business acumen, a service mindset and digital savvy will be in great demand.

Tomorrow’s winning organisations

In taking a fresh look at our 2018 publication, one insight stood out: Doing just one or two things exceptionally well probably won’t cut it. Nor will working in isolation. The future of Finance is all about managing across functions, building the right combination of capabilities and establishing a strong data foundation. That’s what will distinguish tomorrow’s winning organisations.

Excelling in multiple areas can sound like a tall order, but it may be easier than it appears. Gains in any one area can create a multiplier effect, facilitating progress in others. The key is knowing where to place your bets (based on evolving business needs and existing finance capabilities), then managing change holistically. With steady progress, you can get where you need to be.

Deloitte can help

Our Finance Labs explore the “art of the possible” and define your Finance Transformation strategy, bringing to life potential use cases, road map priorities and future-state benefits. Contact us to learn more.

Download the full report

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