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What Corporate Finance Tech Adoption Will Look Like In Two Years

It’s that time of year again, when experts muse and analysts forecast for the year (and years) ahead. In corporate finance, the predictions are largely about the adoption of the most cutting-edge technologies, from artificial intelligence (AI) to blockchain.

The latest report from Gartner, Inc. suggested that investments in innovative tech for corporate finance will be strong in 2019 and 2020, though not all technologies will receive the same attention and fanfare that some analysts might have expected.

In its survey of 419 corporate finance professionals, Gartner found that most finance departments have plans to implement more than one of the top-nine emerging technologies by 2020. Gartner Senior Director Analyst Christopher Iervolino said corporates are motivated by the need to cut costs, heighten their financial controls and obtain newer insights about their organizations overall, particularly as corporate finance teams evolve to provide strategic insight and value to their firms.

He emphasized the potential for artificial intelligence in particular to make a significant impact on corporate finance teams, with 27 percent of survey respondents expecting to deploy AI or machine learning technology by 2020.

“Alongside this survey data, we’ve also conducted an extensive global analysis of social media conversations around the term ‘financial planning and analysis’ when discussed alongside AI, from 2016 through 2018,” Iervolino explained. “The results show that the number of conversations including this phrase has been growing rapidly, with a compound quarterly growth rate of 15.7 percent.”

It is, perhaps, unsurprising that artificial intelligence would emerge as a top focus for corporate finance investment, considering how much attention the technology has garnered in recent years. Yet, according to researchers, it’s worth noting that successful implementation of AI solutions in corporate finance departments remains limited today, with analysts pointing out that other technologies like predictive analytics and robotics process automation (RPA) might be better understood by the industry.

Predictive analytics emerged as the most common technology that corporate finance teams expect to have deployed by 2020, Gartner found, with half of survey respondents citing the technology as one they plan to implement. RPA was cited by 29 percent.

“The lack of working AI deployments is no big surprise, because the technology is not yet built into most [financial planning and analysis (FP&A)] application suites,” Iervolino said. “There is tremendous potential for transformational improvement, but these capabilities are only just becoming mainstream, so the deployment expectations we see in the survey may be unrealistic for many.”

The data suggested that much of the burden in promoting adoption of innovative technologies like AI in corporate finance departments remains on the shoulders of the solutions providers and developers themselves. However, AI isn’t the only tool to which these companies, and their corporate finance clients, should be paying attention.

In addition to predictive analytics and RPA, mobile financial process support and analytics emerged as the second-most popular technology that corporate finance departments are planning to invest in by 2020. Integration of external data is also a key focus, cited by 27 percent of survey respondents to tie with AI and machine learning deployment plans.

Perhaps most interesting about the report are the technologies that organizations don’t plan to adopt for their corporate finance teams, at least not in the next two years.

Chatbots, which have gained traction on corporate financial platforms in recent years, were cited by just 2 percent of survey respondents as a technology that will be implemented in the enterprise by 2020, tied for last place with natural language processing.

Blockchain, one of the most hyped technologies in recent years particularly when it comes to corporate finance was chosen by only 7 percent of corporate finance professionals surveyed by Gartner as a target for their technology adoption plans.

While there are many factors that will play into determining which technologies corporate finance teams will have successfully deployed by the end of the decade, research from Gartner and others make it clear that professionals are prioritizing investments in cutting-edge tools. In a separate report published on Wednesday (Dec. 5), Protiviti and North Carolina State University’s Poole College of Management Enterprise Risk Management Initiative identified digital readiness as a top concern for organizations in 2019.


New PYMNTS Report: Preventing Financial Crimes Playbook – July 2020 

Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.