As Prophix CEO Alok Ajmera reflects on 2021, dynamic financial planning and intelligent automation emerge among key trends to watch for this year
MISSISSAUGA, Ontario – With issues ranging from supply chain disruptions to cybersecurity threats and continued business uncertainties due to the pandemic, 2021 was a difficult year for CFOs across the globe. These challenges were exacerbated by a significant shortfall in digital transformation, as determined through recent studies, that hindered the ability of finance teams to anticipate and respond to business changes. This next year, however, represents an exciting moment for finance executives who are now more than a calendar year removed from the uncertainty of the COVID-19 pandemic and are ready to meet challenges head-on.
Alok Ajmera, CEO of Prophix Software, reflects on the shortfalls of 2021 and identifies emerging industry trends to watch for this year: “Last year, our ‘Agility in Planning, Budgeting and Forecasting’ survey findings done in conjunction with FSN Research identified most finance departments still face challenges in their digital transformation with sizable gaps in abilities and outcomes in nearly every survey category – ranging from speed to insight to forecasting accuracy, to the ability to conduct scenario planning. Our benchmark report underscored the need for digital transformation to help fundamentally change the role of finance from reactive to proactive, better anticipate change, and take a stronger role as a business advisor. By leveraging more advanced tools within corporate performance management software, including artificial intelligence capabilities and intelligent automation, finance executives can be better prepared for what comes next.”
Ajmera shares 5 predictions for finance teams looking to close the digital transformation gap in 2022:
- Dynamic Financial Planning Will Be The Antidote To Continued Business Disruption
From supply chain shortages to rising inflation, businesses most likely will continue to deal with various disruptions in 2022 – and dynamic financial planning tools such as cloud-based “if/then” scenario planning software will emerge as the sure proof solution for businesses to remain nimble and quick footed in their strategic decision making.
- Strategic Finance and Operational Planning Will Go Hand-in-Hand in 2022
To unite FP&A strategy with operational planning to meet long-term goals, companies will focus on obtainable financial and organizational targets, ensure their budget supports organizational plans, make use of financial planning software to optimize strategic planning, and more.
- A focus on “Intelligent Automation,” Not “Hyperautomation”
While a compelling concept, hyperautomation will not be the silver bullet for CFOs seeking to streamline their reporting processes in the year ahead. Instead, finance executives will apply “intelligent automation” technologies to specific areas of the business to reduce manual work, increase speed of decision making, and improve data accuracy for reporting processes.
- Zero-Based Budgeting Makes A Comeback
Zero-based budgeting (ZBB) is gaining in popularity, and it is not the slash-and-burn tactic it once was. Instead, with the help of automation, cloud platforms and AI, ZBB allows businesses to roll out budget changes quickly while increasing a company’s nimbleness in other aspects of FP&A – from capturing operational efficiencies and stimulating growth to boosting performance. Expect to see an increased adoption of ZBB in the coming year.
- The Era of AI-Powered Corporate Finance Is Here
CFOs have been slow to adopt advanced technologies such as AI due to a number of factors, including tightened pandemic budgets, lagging digital transformation efforts, and a lack of prioritization. As businesses emerge from the volatile pandemic period, expect to see CFOs finally taking the plunge into AI-powered finance technologies, kickstarting the next era of super-charged corporate finance.
Looking beyond corporate finance tech functionality in 2022, Ajmera also shares predictions on key industry trends likely to take center stage:
- ESG Will Make It On Businesses’ General Ledgers In 2022
In 2022, there will be no escaping the growing importance of and business focus on ESG (environmental, social and governance). CFOs who fully commit to implementing sustainability strategies in 2022 – including creating a company-wide ESG task force, reporting best practices and tying compensation to sustainability goals – will be able to prevent financial loss and missed profit opportunities, while also boosting their corporate reputation.
- Cybersecurity Takes Priority for CFOs
CFOs are recognizing the need for new solutions to protect private financial data. In 2022, CFOs will be looking for comprehensive security solutions — inclusive of people, processes, and technology — coupled with third party verification and certification to identify, review, and mitigate all risk, to keep their businesses and their budgets safe from cyber threats.
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