Robotics, machine learning, blockchain- all technologies which cause disruption and spark digital transformation. 2016 could well be described as the year in which technological developments gained a foothold in both boardroom planning and management publications. If the trend gurus are to be believed, there are some big changes on the horizon. But what’s realistic? And what time frame are we talking about? What are the hot topics that should be on every CFO’s strategic agenda in 2017?
1. Further decrease in human interaction – Robotic Accounting
The cabinet and business leaders have agreed that as of January 1st, 2017, all national government suppliers must invoice new purchase agreements electronically. The government has taken a significant step forward with this, which companies will be expected to follow, heralding yet another step towards the comprehensive robotisation of the accounting process. One only needs to look at the 2016 SME survey conducted by Exact to see that this is a substantial issue: the survey shows that 34% of businesses in the Netherlands* are still invoicing by hard copy, i.e. not even in PDF. That is extremely outdated. It is relatively simple to activate a module for this. Electronic invoicing results in considerable efficiency gains both for you and your suppliers; on the incoming side, switching from paper to electronic invoices amounts to a minimum saving of five euros per invoice. In 2017 robotic accounting will further take shape, in which the invoice is no more than an electronic message between ERP environments and processing is driven by triggers and events.
2. Automated confidence
Much has been written about Blockchain in the past year. It has the potential to drastically change the world. But it’s also a buzzword whose meaning and impact people fail to fully understand. This is also due to the fact that the explanation of the term is often of a technical nature. Blockchain is a disruptor of our economy and society, and has the potential to be a real game changer. Blockchain implementations will happen sooner than you think, and it is essential, in 2017, to consider what the consequences will be.
The financing of working capital and ‘triple entry accounting’ are highly specific applications in which Blockchain already plays an important role. For SMEs, the impact on the financing of working capital is interesting. Data that is now captured in corporate and institutional systems is linked and recorded with Blockchain technology. The value of the information is increased, leading to an increase in security and a decrease in risk. The result is easier financing at a lower interest rate.
With ‘triple entry accounting’ the traditional audit by accounting firms is altered by the deployment of Blockchain in the process. The reputation of clients, such as payments and agreements, will be available in the Blockchain. In addition, transactions between companies will be matched through Blockchain technology, leading to a type of real-time auditing. The traditional audit will no longer be necessary, or if so, in a much simpler form, resulting in a reduction in audit costs. It may seem far-fetched, but will inevitably be relevant in 2017.
3. Goodbye risk, welcome cloud
Embracing mobile and cloud technology are deciding factors in maximising growth and becoming more competitive. How can we support business objectives and operational processes with our systems? How do we set these systems up to best achieve those goals? Do we move our systems to the cloud, stay on-premises, or opt for a hybrid form? Scalability, security and automatic updates make the cloud the foundation for better collaboration with access to crucial information everywhere. Not all companies have taken the decision to use the cloud yet. This is a shame, because companies that use the cloud for a majority of or all processes (accounting, CRM, ERP etc.), see an average of 2.5 times more growth than companies that do not use cloud-based systems*. The CFO will increasingly play a crucial role in these strategic IT decisions in 2017.
4. Attracting young talent
The generation gap between ‘digital immigrants’ and ‘digital natives’ is starting to become painfully visible. Whereas digital natives cannot imagine a world without internet and technology, and have an entirely ‘digitised’ mentality, digital immigrants are those who have had to become proficient in the use of computers. Current decision-makers at C-level and higher management level have had minimal training of ICT during their education, or training with outdated technology. Yet they are the people who determine how their company can best prepare for a digital future.
Five years from now, the best organisations will be characterised by the extent to which they adopt innovative digital business tools and applications: where mobility, software-as-a-service, data visualisation, predictive and cognitive analytics make new business models possible and result in financial efficiencies. The power of disruptive companies is to be found partially in the ‘IT minded’ talent of the workforce, who look at the beaten track in new ways and create new lines.
CFOs and Financial Directors: in 2017, strike a healthy balance in your teams between the knowledge of today and the knowledge of tomorrow. Attract young talent: they naturally have more affinity with digital developments.
Source: Exact Blog