4 trends for CFOs and finance teams to watch in 2024

New technology. High interest rates. Artificial intelligence. There are some unique challenges for chief financial officers (CFOs), but new and emerging tools are available to help us meet these challenges. With 2024 well underway, I wanted to share a few trends I’m seeing that may help shape some of your strategy and thinking this year. 

Automation and digital transformation

Automation presents companies with a huge opportunity to increase output, reduce human error, and allow employees to focus on less manual tasks. More than half of all CFOs say they plan to use data analytics, AI, automation, and cloud solutions to drive digital transformation at their companies, according to a recent survey by Deloitte. And, when strategic finance coach Oana Labes asked her LinkedIn followers recently what their top priority was in 2024, digital transformation was the top choice for 23% in the poll.

That’s why nearly 90% of large companies are undergoing a digital and AI transformation. And where data is easily available, the results have been striking. For example, in one study, total shareholder returns for digital transformation leaders averaged 8.1% as opposed to 4.9% otherwise. The same study also found that revenues grew faster and expenses grew slower for digital-leading companies. 

Try building more automation into your reporting. By doing so, you and/or your team can focus their time on reporting. 

New ways to drive predictive modeling

Anyone in finance is looking for ways to better anticipate spending and revenue trends. AI and new technologies have opened up new ways to do just that. There are two simple steps in predictive modeling: Learn what might happen, and take steps to respond. 

There is often so much underlying data that can provide insight into spending and revenue forecasting. AI tools can process that data and reveal potential outcomes for your team to respond to. 

Here again, by leaning on AI to analyze data and identify trends, your people can then focus on telling a story with the data to potential stakeholders. We’ve leaned into AI and machine learning to enhance our: 

• Late-fee modeling 
• Interest rate action step plan
• Finance fee and operating interest reporting and modeling
• Credit and fraud loss reporting and modeling 

Financial discipline and growth

External forces such as interest rates, inflation, and employee turnover are often outside of a CFO’s or finance team’s control. In light of that, finance must play a larger role in driving the strategic agenda to ensure financial discipline and support profitable outcomes. 

Finance also needs to play a front-row seat in driving discipline to put a face to the need. Tightening finances can be seen as holding back innovation and making jobs more difficult, so your concerns must be understood and communicated across teams and throughout the organization.

Investment in talent and ways of working

You’ve probably heard that it’s cheaper to retain a customer than it is to attract a new customer. Well, the same is true of your employees. It costs 33% of a person’s annual salary to replace them, according to one study. For example, that means if an employee making $75,000 per year leaves your company, it will cost $25,000 to replace that employee. Keep in mind that there’s a cost to hiring, training, and getting the new employee to the level of experience of the employee you lost. 

There’s a role for finance to play in ensuring a company is investing in its employees on many fronts, including: 

• Employee retention
• Ways of working/efficient operations
• New skills to adapt to a fast-evolving business world

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The information in this blog post is for educational purposes only. It is not legal or tax advice. For legal or tax advice, you should consult your own legal counsel, tax and investment advisers.