Crunch time series for CFOs: Finance 2025 revisited

Finance will continue to automate, but the focus will shift from operational finance to financial insights.

The finance factory will focus increasingly on using big data, analytics, and predictive modeling 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.

Finance will, as predicted, focus more on service, analytics, and business insights, all of which mandate new capabilities.

To bolster its capabilities, Finance will offload some responsibilities to captive locations, centers 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.

Although real-time financial data will still be a ways off, quarterly reporting will gradually lose its relevance for investors and management, both of whom now require more timely information to make decisions.

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.

Finance will remain uneasy about the use of self-service data, but it will embrace self-service as a way to rationalize reporting.

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 visualization 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.

Cost reduction has historically been the impetus for changing finance operating models. But that focus will evolve as new models look to expand Finance’s core capabilities and enhance what it can deliver in partnership with other functions.

With a widely dispersed workforce, Finance will gain access to global talent pools and specialized resources. Finance also will make greater use of freelancers and gig workers. As businesses prize new capabilities, some CFOs will adopt the “center-office” model, which emphasizes end-to-end processes, capabilities on demand, and coordination of external partner networks. In doing so, they’ll absorb responsibilities historically managed elsewhere.

Through acquisitions and functional enhancements, ERP vendors have largely staved off competition from specialized applications and microservices.

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 centers to front-office drivers of business value.

Standardized, high-quality data will become even more important, as data is the foundation for business insights, automation, and touchless operations.

Having bad data flow into automated AI systems won’t create efficiencies or result in practical business insights. To realize 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.

Finance will hire more people who can configure and customize digital tools to generate insights, and work will increasingly be done remotely as hybrid workplaces become common.

Finance organizations 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.