5 growing trends for 2024 that your finance team needs to be aware of
While it’s important to build organizational resilience to help manage the unpredictable, there is also value in preparing for the predictable, what we know is likely to come, and how we can control the effects of these trends.
This is perhaps of most use to the office of the CFO or finance, who need to inform organizational strategy with the predictive insights they gain from digital tools.
Beyond the internal trends of finances, a finance department will also require wider awareness of general macroeconomic trends, increased use of certain digital tools, and more, to inform their financial and organizational strategies for 2024.
This said, these are only predictions and will depend on various factors, including economic conditions, industry-specific dynamics, and global events.
In this blog, we are going to discuss some trends impacting finance, planning and analysis for 2024, and what you can do to prepare for them.
AI will only increase in use among finance teams
It’s likely no surprise to learn that AI will only grow in its use over the coming years, and into 2024.
The benefits of AI for advanced report generation, and automation of manual data entry and data consolidation tasks, are clear. This can help greatly with predictive forecasting, and budgeting, enabling faster and more accurate financial modeling.
Forrester concurs with the increasing use of AI into the next year, suggesting that “current projects already cite improvements of up to 40% in software development tasks.”
Forrester adds that those who leverage AI technologies into the next year will “free up to 50% more time for employees to engage in creative problem-solving, driving customer-centric innovation and creating unprecedented business value.” AI can help organizations make data-driven decisions to inform strategy.
AI will become key in allowing the office of the CFO to spend more time on predictive and forecasting tasks, informing strategy, and building business intelligence, rather than getting entrenched with data consolidation in legacy systems.
AI and automation will benefit compliance and reporting requirements with advanced reporting capabilities, and the ability to automatically adapt as changes occur, or simply notify FP&A teams.
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Sustainability and ESG Reporting will become more important
From 2024, environmental, social, and governance reporting will become mandatory, and other sustainability reporting requirements will become integral to financial reporting.
An organization's ability to report on these factors, at the least, and their ability to comply with mandates more succinctly as a result, will become huge factors for not just investors but for business partners.
FP&A teams will need to stay updated on regulatory changes and ensure that their financial reports meet all necessary standards.
In 2024 compliance with ESG reporting will become mandatory, factor into investor interest more, and become an obligation for enterprises of all sizes. As a result, a succinct approach to ESG reporting requirements will be required.
Cyber Security and Data Privacy will increase in importance
As more and more organizations move to the Cloud, for good reason, there needs to be an even greater focus on safeguarding data in the Cloud and preventing cyber-attacks. FP&A teams will need to work closely with IT and cybersecurity experts to protect sensitive financial data.
With a shortage of privacy talent, the office of the CFO or finance may need to undertake some of this responsibility themselves as privacy teams are generally underdeveloped.
Those who want to protect their data, particularly their financial data, will need to ensure that privacy and cybersecurity teams are bolstered, and, where talent shortages abound, are provided the necessary technology to optimize productivity among current talent.
The office of the CFO needs to focus on developing talent
There has been a shortage of qualified accountants in recent years, and those still relying on legacy systems will certainly feel the brunt of this more than anyone else.
In 2021 the AICPA found a decrease in the amount of accounting graduates and an increased number of retirees which has had knock-on effects for future years.
As a result, many organizations are having trouble finding qualified accountants, which presents automation as a potential solution. Many organizations find that their accounting needs are not being met and this can hold back growth.
Those who embraced digital transformation will recognize the benefits of AI automation in optimizing current finance teams. By embracing digital tools and automation, you can manage your current resources with more confidence knowing your day-to-day tasks are being dealt with efficiently.
As we move forward into 2024, the modern office of the CFO must ensure that talent is developed alongside the implementation of technology.
Many of the modern talent that already exists may expect certain digital tools to be in place, but organizations will benefit greatly from ensuring new and current talent have the skills to use Cloud-based FP&A tools.
Moreover, FP&A teams must work alongside a digitally mature HR operation to develop talent and ensure talent is retained and nurtured with relevant compensation and total reward packages.
International dealings will require strategic insight
Global economic uncertainties, compounded by global supply chain issues, will likely prevail into the next year. FP&A teams must work with a digitally mature procurement function to ensure that supplier relations are strong enough to withstand disruption.
Moreover, FP&A teams must combine with a procurement function to ensure that risk is managed with success. This cross-functional response to potential disruption will require integrated data.
Those organizations that seek international expansion and market diversification will require a similar level of strategic insight from their FP&A teams to ensure these decisions are led by data across both financial and procurement functions.
Final Thoughts
It’s clear the trends that could occur in the coming year will likely require integrated data, cross-functional collaboration, and digital mature teams.
Those still relying on legacy systems in 2024 will likely struggle to both keep up with the competition and will lack the digital maturity to satisfy the issues we have outlined.
Unit4 can provide the digital transformation your organization needs to navigate the coming year with our Cloud-based integrated ERP, which can provide digital FP&A, HCM, ERP, and Procurement solutions that are engineered with these trends in mind.
You can hear more about our adaptable and extensible ERP suite on our website and learn how we can help you become a digitally mature and data-driven enterprise for 2024.
