Finance 2025: Digital transformation in finance

Our eight predictions about digital technology for CFOs

Coming off the success of our previous “Crunch time” reports, we’re now looking towards the future with eight predictions for the finance function of 2025. The technologies needed to reimagine finance are here and they will only get better. It’s crunch time.

Preparing for the future

None of us knows for certain what the future will hold, but we all have a responsibility to be thinking about what’s likely to happen, and to prepare for it. In the finance function, that means working now to get the right people and technology in place to take advantage of the inevitable disruption ahead. That’s not likely to happen without a clear vision and strategy for finance in a digital world. Now is the time to step back and make sure your roadmap to that future is clear.

With that in mind, below are eight predictions for finance in 2025, based on what finance leaders are doing and the technology available today. Once you’ve taken a glance through the predictions, consider:

  • Downloading the full “Finance 2025” report to understand how each of these trends impacts finance work, finance workforce, and finance workplace and the steps executives can begin to take today.
  • Taking the survey lower on this page to provide your thoughts on these predictions.
  • Explore our previous Crunch time reports, including “Crunch time IV: Blockchain for finance,” “Crunch time III: The CFO’s guide to cognitive technology,” “Crunch time, too: CFOs talk off the record about finance in a digital world,” and “Crunch time: Finance in a digital world.”

Eight predictions for finance in 2025

The methodology for generating our predictions is straightforward. We look carefully at what finance leaders are doing and at the technology that’s available, and then we ask these questions: What would be possible if we combined different technologies to reimagine the future? How would the work of finance get done and who would do it? How could finance contribute even more to the success of the company?

 

1. The finance factory: Transactions will be touchless as automation and blockchain reach deeper into finance operations. 

In the years ahead, cloud-based ERP, automation, and cognitive innovation will continue apace, creating opportunities to radically simplify processes and free up people. Adding blockchain to the mix will only accelerate this trend. As this transition picks up speed, the capacity of humans to add value will be unleashed.

Some find it interesting to speculate about finance disappearing under the crush of digital disruption, but we don’t see that happening. Yes, finance will likely be leaner, but that will mostly be a function of headcount in operational finance (order-to-cash, procure-to-pay, transactional accounting, etc.). Meanwhile, expectations for support from business finance (business partnering, reporting, planning, budgeting, forecasting, etc.) and specialized finance (tax, treasury, IR, etc.) will continue to grow.

 

2. The role of finance: With operations automated, finance will double don on business insights and service. Success is not assured. 

Whether finance continues to direct the resources currently under its control will be dependent on its ability to add value. That will require quality insights and exceptional customer service. Some finance organizations will evolve into full-fledged business service centers.

Companies know that sharing knowledge across disciplines is a good thing, even if it creates headaches. Learn what it takes to make the most of blurring boundaries.

 

3. Finance cycles: Finance goes real time. Periodic reporting will no longer drive operations and decisions - if it ever did. 

When both actuals and forecasts can be produced instantly on demand, traditional cycles become less relevant. The old distinction between operational and analytical data begins to disappear. Finance organizations will still need to meet external demands for cyclical information, but outside investors may also want more frequent performance information. Leading organizations will be operating with a new mantra: There is no close. You’re not forecasting once a month or quarterly. It’s all happening in real-time.

Many finance cycles today are driven by technology and data-processing limitations. Things happen on a regular schedule because that’s the only way they can happen. When information becomes instantly available to those who need it, traditional cycles become unnecessary. That frees people up to focus on discovering new insights and acting on them.

 

4. Self-service: Self-service will become the norm. Finance will be uneasy about this.

There are plenty of business people who don’t need hand-holding when it comes to basic finance. If they could get their questions answered by a digital voice on their smart phones, they’d be happy to do so. Activities ranging from budget queries to report production and more will be automated. Over time, smart agents will learn what kinds of business information an individual needs, and deliver that information proactively. As that future unfolds, data in spreadsheets will be replaced by visually rich information that is intuitively accessible and easy-to-use.

With growing expectations for responsiveness and quality from finance, getting self-service right is paramount. When your customers are having to take care of themselves, the last thing finance needs is for them to be frustrated or unhappy.

 

5. Operating models: New service delivery models will emerge as robots and algorithms join a more diverse finance workforce - think about the integration of freelancers, gig workers, and crowds. 

Companies will assess the benefits of automation against onshore and offshore operations. Automation provides a new lever for managing costs, one that gives finance organizations the opportunity to reevaluate how they’re organized, where work gets done, and what kinds of processes no longer require human intervention. Finance-as-a-service will gain traction beyond mid-market companies.

Companies may see significant disruption in the offshoring and outsourcing space, with individual suppliers and their capabilities looking quite different than they do today. At the same time, the need to build dynamic, cross-functional teams will strain finance organizations that aren’t preparing now for what’s ahead. As with all changes, good leaders will be essential for navigating these transitions.

 

6. Enterprise resource planning: Finance applications and microservices will challenge traditional ERP. Big vendors will be prepared.

ERP vendors are already building digital technologies like automation, blockchain, and cognitive tools into their products, but that won’t forestall competition. Look for the landscape to shift as new players enter the ERP space with specialized applications and microservices that sit on top of—and integrate with—ERP platforms. Cloud-based ERP will help ensure that you’re constantly updated on the latest release.

Finance is entering a golden age of technology. As cloud becomes the norm for ERP, finance applications and microservices will proliferate. You’ll be able to drastically reduce the complexity and cost of technology, without sacrificing functionality.

 

7. Data: The proliferation of APIs will drive date standardization, but it won't be enough. Many companies will still be struggling to clean up their data mess.

Few companies are doing the hard work needed to align and integrate data—which means they won’t capture the full value of digital transformation. Those hoping for a silver bullet to solve their data problems will be disappointed. Automation and cognitive will make it easier to get the work done, but it’s still going to be hard and tedious. What are we talking about? Commas, abbreviations, data-entry fields, nomenclature, and hundreds of similar factors. It’s not glamorous, and it’s not glitzy. But it is important.

Data problems hide beneath the surface for many CFOs, some of whom don’t fully appreciate the heavy lifting required to fulfill their requests. That’s partly because the problems involve technical issues, and partly because there’s little motivation for people to elevate the problems to the corner office. No one wants to be the bearer of bad tidings.

 

8. Workforce & workplace: Employees will be doing new things in new ways, some of which will make CFOs uncomfortable. 

Finance talent models are evolving quickly, with a premium placed on data scientists, business analysts, and storytellers. This represents a dramatic shift for many finance organizations. To get ready, make sure your new hires represent the future you’re striving for. Important qualities include a strong customer service orientation, flexibility, and good collaboration skills—in addition to the technical capabilities needed for specific jobs. Also, all of your people should be able to contribute to elevating the value of finance in terms of communication, impact, and influence. Make every new hire count.

Implementing new technologies is relatively easy compared to changing your talent model. They’re obviously connected, but cultural and organizational shifts related to your workforce may take much more time and care to get right. Your finance organization should be looking at every new hire through the 2025 lens.

Don’t stop there! There’s more to explore:

Download the full report and take the survey below.

What’s your view on the future of finance?

To be candid, there’s no doubt we’ll be wrong about exactly how some of the predictions presented above play out. Just as there is no doubt we will be right about others. Quickly let us know your perspective using the pulse survey below and indicate whether you’d like to receive an infographic in the Fall with a recap of responses, to see how your answers compare against others.

Shaping the future of finance: FinVENTA

When Sumerian merchants first recorded livestock sales on clay tablets, finance technology was born. Five thousand years later, technology has evolved into a new class of digital tools reshaping every aspect of the business. No matter what future you see for your finance organization, one thing is clear: That future is now. If you’re going to compete in the digital world, your organization needs to forecast and manage more effectively and become more efficient.

The key? FinVENTA, an integrated technology platform that leverages a modern digital finance architecture and disruptive technologies to showcase the art of the possible across operational, business and specialized finance for deeper, more accurate insights that speed time to outcome.

Learn more about FinVENTA.

It’s crunch time for digital transformation of finance

Want to learn more about topics related to finance in a digital world? Explore “Blockchain for Finance,” “The CFOs guide to cognitive technology,” and more at our Crunch time site. Whatever your interest, one thing is clear: From cloud computing and robotics to analytics, cognitive technologies, and blockchain, a new class of digital disruptors is transforming how the work of finance gets done.

Did you find this useful?