What finance leaders face next

Recently, Capital One Trade Credit joined more than 2,000 CFOs at the 2023 Gartner CFO & Finance Executive Conference to explore the opportunities and challenges facing finance executives in the coming year. Below are some of the main takeaways from the conference.

While finance teams have long been utilizing some automation in their systems—such as three-way match for invoices or automated fraud flagging—today’s technology is providing even more opportunities to optimize and transform finance processes.

According to Tamara Shipley, VP analyst at Gartner, the first step is to determine what “constitutes process excellence” for your organization, so that you can identify process shortcomings and make smart decisions on where to invest in improvements. For example, by updating your accounts receivable processes with an integrated invoice-to-cash application, Shipley says it’ll be easier to predict customer payments and inform collection strategies to get faster payments.

Other processes that can be improved or automated to remove pain points from your team include end-of-month reconciliation, GL entries, credit approvals, and customer communications, like billing reminders.

When considering how to further integrate new technologies into your finance operations, CFOs and finance leaders should focus on the business value that needs to be created. A finance capability framework can help you visualize tradeoffs and align technology investments and decisions with your strategic objectives so that instead of investing for the sake of innovation, you are maximizing business outcomes.

For technologies that will be shared among different functions, collaboration during planning will be key. Cross-functional technologies need their own roadmap and decisions should be driven by process owners, not a single function.

Additionally, some teams may display what Mallory Barg Bulman—Senior Director of Research at Gartner—calls “digital conservatism,” which is often due to a concern that accounting will have to clean “the mess of poorly functioning processes.” In fact, a Gartner survey of more than 100 controllers found that disagreements between organizational functions were slowing down process and digital transformations more than three-quarters (77%) of the time.

While Bulman identified accounting teams as expressing digital skepticism, this can occur with any team used to doing things a certain way. For example, sales teams who are used to handshake deals for important customers may balk at going through a digital system for credit approvals.

To work through interdepartmental disagreements, Bulman offers several suggestions:

• Set digital objectives that are measurable and time-bound.
• Create a company-wide business case template for all digital initiatives to align digital working groups.
• Build in processes to surface–and resolve–disagreements between departments.

Finally, composability is a key approach to strategic technology investments. By seeking out modular, interoperable solutions that are best-fit for specific finance capabilities, you can reduce the agility and flexibility limitations of complex single-vendor systems.

By 2024, Gartner estimates that 60% of finance organizations will seek composable finance applications for their tech investments—and those that do will enjoy 30% higher revenues than those that don’t by 2025.

In her session, VP Analyst Nisha Bhandare discussed how a composable technology strategy can empower finance organizations to increase agility and deliver innovation faster. Some of her key points included:

• Composability can drive efficiency and innovation. There doesn’t need to be a tradeoff. It can drive standardization in core capabilities, while providing differentiation in value-added capabilities.
• It should be supported by technology governance that supports experimentation and a fail-fast culture, while providing stability for core tech like ERPs.
• Lead top-down by identifying where innovation is needed. But execute from the bottom up by encouraging experimentation, providing the technology foundation to do so, and promoting composable thinking.

The technologies highlighted at the conference give Finance, particularly Accounts Receivable, an opportunity to contribute to building a customer-centric organization. In today’s challenging economy, it’s critical to grow current customers and be able to compete with online giants.

Capital One Trade Credit’s own senior vice president Scott Simpson led a session at the 2023 Gartner conference on how finance leaders can “Seize the AR Moment: Wow Customers and Grow Sales in a Changing World.” In it, he shared the changing expectations of B2B customers, how businesses can use technology to meet and exceed those expectations, and the critical role of AR. To watch the session and read a recap, visit “Why now is the time to transform AR.”