In a digital era where software is eating the world, the vast majority of public companies are struggling to stay current when it comes to deploying new technologies in their tax and finance departments. It’s true that one of the primary duties of the chief financial officer is to de-risk the enterprise, but at what cost when they are losing competitive advantage due to slow adoption of new technology? We recently attended the Financial Executives International (FEI) CFRI Conference in NYC where a couple of themes dominated conversations across the board. Corporate finance leaders need to bring new technology into their organizations now or be left behind. And these professionals should be supported by both the audit committees and boards to whom they ultimately report.
The FEI conference had a number of keynote speakers and other sessions focused on technologies that are currently impacting the financial reporting arena and have the potential to further capsize the financial boat in most corporate enterprises if leaders are asleep at the helm. According to the media outlet Agenda, during his keynote chat, Alex Gorsky, CEO and chair of Johnson & Johnson, said the biggest threat to companies is not innovating, and the second biggest threat is the “fundamental ways in which new technology is going to impact what we do.” The “get on board or be left behind” theme isn’t new. But when corporations are faced with decisions on balancing risk and investment in innovation, the choices and outcomes are usually uncertain at best. That said, finance leaders can be certain that their most progressive peers will be navigating those uncharted waters in hopes of reduced costs and increased profits for their companies.
Let’s call out the technologies mentioned during the conference: robotic process automation (RPA), machine learning, AI, blockchain. Some of these technologies are being deployed today at various levels with varying levels of success. Of all these technologies I personally believe blockchain is by far the best suited for applications in the tax & finance world. Think about it: blockchain is an immutable ledger that provides complete trust in the transactions within the system. Financials are built on ledgers. Don’t we all want complete trust in financial reporting? Sure, you can layer in pieces of automation to enhance workflow and machine learning until we have open data. But blockchain is the silver bullet – this technology is a real game-changer and the future of financial & regulatory technology. If you don’t believe me, just ask the CEO of IBM.
We haven’t formally announced our next product line yet, but I will give you a teaser here: it includes the use of blockchain technology. Stay tuned…