What’s beyond the current endgame of Finance where transactions are outsourced or offshored and in some cases even automated, analytics is system or robotics driven and frontline interactions are left in the hands of the few finance business partners on whom everything hinges?
We know. It’s a quite bold statement but hear us out and let’s discuss at the end of it all. You can automate a lot of what’s happening in Finance. Most transactions in the future will be digitized meaning that if you have coded all accounting rules and guidelines into your system you don’t really need to touch any of it. That should also limit errors making accounts receivable and accounts payable work without human intervention except in extreme cases like when a customer goes bankrupt. Creating your annual accounts would be by the push of a button as your system is already set up to produce the exact schedules you need and auditors can audit your coding of accounting rules rather than the actual numbers. Explanations will be given directly by the business. The now nearly flawless accounting data will flow directly into your analytics platform and be available in real time for the business to use. The business still needs someone to interpret the data which could be a robot, present the findings and bring forward suggestions for action i.e. finance business partners, however, these could just as well be embedded in the business.
Will there still be a CFO? What about funding and risk management? M&A, capital allocation and tax? Well, those are all still there. The areas of true specialists also consisting of technical accounting to interpret new accounting standards to be coded into the system will continue to exist but only at a headquarter/strategic level where the direction is set for how Finance should be run out of the system. This is not just a cost-cutting exercise but more to say that Finance needs to truly specialize to remain relevant. Move on from the basics of just providing numbers and collecting cash. Not that those aren’t important but they are simply automated. And the specialists? They will all be measured on value as well. Tax is a cost that should be driven down within the legal framework. M&A’s must yield more value than those of the past. Capital must be allocated to the units generating the highest return etc. The future currency of Finance is “value creation” measured as bottom-line impact. If that thought scares you because “hey you’re not a salesperson” which is why you came to Finance (to hide) then you better decide fast. Embrace the future of Finance or find yourself something else to do.
We know it can be a brutal message to swallow but wouldn’t you rather want to know now before the robot comes to take your job away? Wouldn’t you rather want to have the chance to make an active choice of what to do with yourself? To specialize, you can further educate yourself by getting a higher degree or become a data science whizz. There are still many opportunities to explore but please don’t remain seated. Get up and make an active choice about your career in Finance. If you wait it might be too late to react which is what 1,000s of finance professionals have found out the hard way ever since the Financial Crisis. Their jobs are simply gone. Yes, the future of Finance might sound brutal but it’s also full of opportunities so what are you going to do? We’d love to hear your perspective! The end might not be near but the future of Finance looks a lot different from that of yesterday. We hope that from reading this book you now better understand why transforming Finance matters, how you can do it and what return you should expect.