Back Office Is The New Front Office: akin to what we’ve seen with CRM and ERP over the past two decades, there is currently a grand redesign (and re-architecture) of backend systems such as HR, accounting, budgeting, billing, payroll and financial planning & analysis (FP&A) tools. Businesses are seeking interoperable, cloud-native solutions that have consumerized user interfaces because they enable non-IT departments to utilize new software of their choice without the constraints and complexities that accompany legacy software and services. VC-backed companies like Expensify, Zuora, Zenpayroll, Zenefits and Namely are but a few companies leading this charge. Other companies attempting to re-imagine some of these traditional areas of finance and operations (FinOps) will have no problem raising funding or recruiting new employees as they continue rising to the forefront of organizations’ and investors’ wish list this year.

 

Big Data As Smart Data: just about every research report and industry analyst firm is suggesting an increase of big data usage in businesses. This year, the generalization of big data will dissipate, becoming better defined (and for specific industries and non-IT audiences) as more applied use cases become available. No longer will organizations be satisfied with unstructured data collection, instead they’ll demand collection, categorization, analysis and visualization of the data so it can be used to prescribe more specific insights with actions. This evolution is what we, along with others, believe is the fundamental shift towards Smart Data.

 

Finance And Tech Cross Paths: the intersection of Wall Street and tech takes another step towards convergence this year. Progressive startups are embracing (and heavily recruiting) Wall Street talent to help run their FinOps, incorporating Wall Street-experienced personnel to the non-traditional environments that startups are known for. Kristina Salen, a former Fidelity analyst, runs Finance for Etsy. Sarah Friar, who spent more than a decade at Goldman Sachs, is the CFO of Square. The Wall Street Journal reported that Uber, in 2013, hired 10% to 15% of its 250+ employees from the finance industry and 5% from investment bank Goldman Sachs Group Inc. Even BNY Mellon established a new Innovation Center in Silicon Valley this past November. Whether you pick the moniker of Wall Street meets Silicon Valley, or software eats finance… one point is clear, and that is traditional finance and tech are converging.

 

We Are All Becoming Data Gurus: CEOs and CFOs will continue demanding more data mining and analysis skills among their staff. While most of us have seen the documentation on the shortage of available data scientists with PHDs, businesses aren’t waiting as they continue their transformations to becoming data-driven organizations. Instead, companies are shrinking the gap by adding advanced data-related in-house training as well as implementing new software with heightened capabilities that are also easier to use. Last Sept., Robert Half & Associatesreported that the majority (61 percent) of the CFOs who participated in its survey said, “…expertise in business analytics, such as business intelligence and data mining, is mandatory for some or all of their accounting and finance employees.” LinkedIn, Ford and Credit Suisse started the trend of applying advanced data interpretation and visualization to their FP&A in 2014; more businesses will see the benefit and follow their lead this year.

 

Forecasting The Impossible And Improbable: today’s technology has evolved, granting users with a new paradigm of predictive planning and forecasting. Machine learning algorithms that understand correlation and causation will be key, as businesses start incorporating both structured and unstructured data into their FP&A processes to gain unprecedented levels of actionable insights. FinOps will reap the benefits much like their counterparts in other departments. For example, companies like Leadspace and Lattice Engines have been working on this for sales; Salesforce.com released Wave to achieve this for marketing; Workday’s Insights will do this for HR.


Originally Published on LinkedIn Pulse