Money Matters

The top 14 finance trends in 2024: Everything CFOs need to know

From the pursuit of business growth strategies to generative AI, CFOs and CEOs share trends for finance professionals to be aware of in 2024.

Today, CFOs step beyond the boundaries of financial management and into digital transformation, strategic planning, and technological integration.

CFOs are at the forefront of integrating artificial intelligence (AI) and automation, crafting strategies that balance growth with strategic capital allocation.

This shift isn’t just about embracing new technologies and data-driven insights for more efficient financial modelling.

It also involves a broader, more integrated approach to business management.

It’s not just about the data, though. Collaboration with HR and other departments is becoming imperative, reflecting a holistic strategy where agility and a robust balance sheet are key.

We delve into these trends with insights from practising CEOs and CFOs, demonstrating how they empower CFOs to drive significant business impact with flexibility, innovation, and strategic foresight.

Here’s what we cover:

1. Increased focus on strategic capital allocation

In 2024, focus on strategic capital allocation.

It’s critical in navigating the end of the cheap capital era and a time of heightened economic volatility.

Sage CEO Steve Hare underscores the importance of CFOs applying a meticulous and discerning approach to investment decisions.

He says: “The age of free or low-cost money is over.

“Capital allocation will come back into fashion as CFOs look at their cost of capital and seek to understand whether a project or line of business is exceeding ROI.”

With the era of low-cost capital ending, the decision-making process surrounding investments has become more rigorous.

This strategic approach to capital allocation is vital for sustaining growth and profitability in competitive markets.

2. More stringent balance sheet management

Understand every balance sheet line item intimately and prepare solid pro forma statements for future planning.

A strong balance sheet is more than just a financial statement; it’s a tool for navigating economic ups and downs.

By consistently reviewing financials and identifying issues throughout the month, you can ensure a smoother month-end close process and better prepare for future business needs.

Ben Smith, CFO of iSi Environmental, says: “This goes back to understanding what drives the business and how to prepare those reliable forecasts to meet future business needs. 

“Business is going to go through ups and downs. Being prepared by always maintaining a strong balance sheet will be the difference between making it through the downturns. 

“Always look to the future and don’t get hung up on looking back at past performance. Be the strategic leader that will help drive the company forward.”

Ben advises you to look at the general ledger posting logs and identify issues throughout the month rather than waiting until month-end close: “Use very specific timelines and hold others accountable for meeting deadlines.

“Working throughout the month towards these goals will make the process smoother.

“It’s not just a busy week once a month. We’re continuously working towards month-close all month long.”

3. Rising significance of mergers and acquisitions

Businesses often turn to mergers and acquisitions (M&A) in economic downturns to drive growth.

Companies with sufficient cash reserves or capital funding are well-positioned to acquire struggling or undervalued businesses, offering a pathway to expand market share, diversify offerings, or enter new markets.

Buyers, including private equity and corporate strategists, have quickly adapted to the new environment regarding valuation and deal structuring.

However, sellers typically take longer to adjust—that valuation mismatch is one of the reasons that M&A was much slower in 2023.

Jay Jung, the founder and principal at Embarc Advisors, a strategic consulting firm for startups and small businesses, anticipates a notable increase in M&A activities in 2024.

He says: “Q4 has started to pick up, and expect 2024 to be very active in M&A as valuations reset for sellers.

“Business owners should plan if they are considering an exit so that when the opportunity arises, they can move swiftly with confidence.”

Alok Ajmera, CEO of Sage partner Prophix, agrees that M&A presents attractive growth opportunities for midmarket businesses.

He says: “During economic downturns, there are two strategies businesses often leverage to drive incremental growth: business optimisation, or merger and acquisition.

“If companies can access cash reserves or capital funding, they can use these resources to acquire struggling or undervalued businesses. This strategy can be especially valuable for mid-sized organisations to expand their market share, diversify their offerings or enter new markets.”

CFOs are naturally at the centre of M&A, strategically assessing potential acquisitions and guiding their companies through the complex financial implications.

Use data analytics during M&A evaluation processes for a clearer idea of the future. The ability to run predictive models to identify growth opportunities and cost synergies is vital.

This analytical approach could allow you to justify investments strategically and avoid costly errors in the M&A process.

4. The pursuit of balanced growth strategies

After cautious spending, businesses are gearing up to invest again in 2024.

Simone Goodman, CFO of Sage Intacct customer Forecast, says: “Balanced growth with optimisation and profitability is very much back in fashion.

“Businesses who cut selectively over the past year or so are increasingly preparing to invest again.

“This investment strategy, however, should be underscored by a stringent focus on ROI. It’s about building resources synchronised with revenue expansion, ensuring sustainable and profitable growth.”

Simone emphasises that challenging market corrections embed resilience and resourcefulness into a company’s culture, which is essential for long-term success.

She says: “Market corrections are painful at the time, but they do build resilience and resourcefulness into the DNA of your teams.

“It’s rewarding when businesses can lean into these qualities to power up their next winning streak.”

5. The optimisation of business processes

With capital being expensive, being able to drive business culture to ‘do more with less’ will continue to be a cornerstone of the finance agenda.

Vineta Bajaj, group CFO of Rohlik Group: “Making finance a profit centre will be integral to the CFO role in 2024. You’ll want to demonstrate the positive profit and loss impact that the finance team brings.”

While global economic volatility continues, most businesses have assessed how to navigate challenges as a standard part of their operations.

Prophix CEO Alok Ajmera says: “Heading into the beginning of 2023, cash was king; maintaining sufficient cash reserves and managing cash flow was critical to financial stability and seizing growth opportunities.”

With the challenges of high interest rates and inflation, Alok now advises CFOs to look at the strategic deployment of cost-effective business optimisation measures, risk mitigation, and contingency planning to identify opportunities for enhancing efficiency and increasing profitability.

Alok recommends asking yourself: “How do we squeeze out the excess fat to maintain profit?

“Having access to innovative technology that supports access to simultaneously model multiple scenarios, assumptions, and variables is essential for these leaders to dig in, draw insights, and make the right decisions for their business.”

If spending slows down, businesses must find ways to streamline processes and keep costs lean. Maintaining healthy margins without overburdening customers with price increases is crucial.

This approach requires a delicate balance between cost management and consumer value delivery.

Gillian Dewar, CFO of Crediful, adds another dimension to this discussion, highlighting the need to adapt to changing consumer behaviour.

She says: “Rising interest rates haven’t slowed consumer spending as much as expected, but we’re finally starting to see those slowdowns as people work through their pandemic savings.

“So, a big task for businesses in 2024 isn’t to fight against slowing sales but to find ways to streamline processes and keep business costs lean.

“Consumers feel fatigued by increasing prices from all angles, so doing everything to maintain healthy margins without passing more costs onto customers should be top of mind for every brand.”

6. Embracing digitalisation and AI-powered automation

Digitalisation and AI-powered automation aren’t just fleeting trends but fundamental changes in how CFOs operate and add value to their organisations, marking the transition from manual, time-intensive processes to automated data-driven workflows.

Sage CEO Steve Hare says: “Digitalisation powered by AI will be revolutionary and enable significant automation of business workflows.

“There will also continue to be a focus on data insights. CFOs have a lot of data and will look for more effective ways to gain insights from that data.”

Marco Torrente, CFO at WebBeds, expects CFOs to look at improving customer experience through AI.

He says: “With chatbots, real-time answering and immediate reconciliation, all consolidation between supplier and customer and payments can become automatic.”

Marco suggests that data analysis through machine learning will improve decision-making in cash flow or automatic revenue forecasts: “These forecasts help the company predict its situation in 6 months or a year—for example, in terms of revenue and profit.

“The company can then act to ensure it meets stakeholder expectations.”

Look at digitalisation to free up the brain capacity of staff so they can spend more time analysing data rather than sourcing it, using creative and problem-solving skills.

Marco adds: “This does not have to involve job losses. It is possible to create new, clearly defined employee roles within new structures.”

Christoph Ott, CFO of Dizmo and Planisy, supports automation in reporting, allowing his peers to equip themselves and others to answer specific questions more promptly.

However, he warns: “With this comes the responsibility for CFOs to check data-driven outputs and ensure that human intuition supports automation to reach important investment decisions.”

Yokoy co-founder and CFO Thomas Inhelder urges companies to be technologically progressive: “Don’t hesitate to invest in emerging technologies like automation, AI, and analytics.

“These tools can significantly amplify the impact of your finance operations.”

7. Generative AI: The new frontier in finance?

Generative AI is not your everyday tech buzzword.

It’s a game-changer that offers deep insights into business data and transforms how it is interpreted and used.

Rajat Bahri, CFO at Icertis, says: “We are seeing generative AI create new opportunities to use resources more strategically.”

This identifies potential revenue streams by surfacing insights into critical business data that may otherwise have gone untapped.

Rajat adds: “With end-to-end visibility into the data they contain, CFOs can minimise revenue leakage, strengthen their supply chains, and combat macro-economic factors like inflation—while bolstering compliance for their organisations.”

Alok Ajmera, CEO of Sage partner Prophix, says few technologies passed through the “hype cycle” as quickly as generative AI. It’s time to use generative AI as a critical finance tool.

He says: “The next real opportunity for generative AI in 2024 will be for specialised use cases, where the AI model generates a response based on a specific request and performs complex quantitative analysis of sophisticated data connected to that use case.

“This is where we will see AI adoption surge and transform how finance work is done.”

For more on AI, check out these articles:

8. Continuing shift to real-time analytics and data-driven insight

CFOs have always been at the forefront of leading companies through change and adapting to new technology.

Lewis Dangerfield, CFO of Sage Intacct customer Osprey Group, tells Sage Advice: “With the accelerating emergence of AI, businesses need to understand its potential now and actively look at how they can make best use of it in the medium term to allow our people to maximise their value.”

Like the other CEOs and CFOs who contributed to this article, he is excited by the potential of AI and automation to reduce the time spent on repetitive tasks, freeing teams to focus on more strategic, value-adding activities.

Lewis says: “If I look particularly at the finance teams, this will support faster real-time interaction and more capacity [to] partner with delivery teams.”

In today’s fast-paced business environment, waiting until month-end to gauge performance is no longer viable.

This is where real-time analytics come into play, offering CFOs and other executives such as CEOs, COOs, and department heads the ability to make quicker, more informed decisions.

Rohlik Group CFO Vineta Baja says: “Internal stakeholders request information in real time, and they should have it in real time.

“Tools such as PowerBI, Alteryx, and others should be the bread and butter of finance functions now, and if they’re not, they should be at the top of your agenda.”

Vineta says traditional methods such as outsourcing or changing business processes are not as effective anymore because of changes in the global economy.

She believes CFOs must think of new ways to solve problems and is another CFO who emphasises the importance of technology and AI.

Vineta says: “Often, there is no need to wait until the month end to understand business performance. Real-time data, BI, and data scientists can help move the future of finance from a month-end cycle to an ‘on demand’ cycle.”

Michell Guzelgul, CFO at Empeon, believes CFOs must become data experts.

He says: “The sheer volume of data flowing through systems can be overwhelming, but transforming those raw numbers into a comprehensible narrative for stakeholders is paramount.

“Binders and Excel no longer cut it. CFOs must constantly improve and expand their technical and analytical skills to thrive in the current business environment.”

9. Automated reporting systems

Automated reporting systems are increasingly vital.

These tools enhance the efficiency of financial operations and redefine your approach to financial analysis and management.

Michelle Delker, CFO of the William Stanley Group, says: “I’ve seen the power of implementing comprehensive and automated reporting systems.

“When done right, this can speed up the close process significantly, allowing more time in analysing financials for actionable insights, rather than merely compiling them.”

Colin Cunningham, CFO for OnBoard, a SaaS-based board management and governance solution, says you should avoid manual processes as much as possible and use systems to streamline them.

He says: “It’s no secret, but you must use new tools and processes to automate rather than do manual work.

“Leverage new technology and systems where those opportunities make sense. We have over 3,000 customers, so we automate as much of the billing process as possible to shorten that window at the end of the month.”

When it comes to the often-daunting tasks of closing month-end books or efficiently managing a profit and loss statement, Yokoy co-founder and CFO Thomas Inhelder only has one word for you: automate.

“Employ tools that help streamline manual processes such as accounting journals,” he recommends.

“Invest in technology that eliminates time-consuming tasks for your team, allowing you to concentrate on activities that add value.”

10. Strategic partnerships and outsourcing

While cost reduction remains relevant in 2024, cutting-edge technology is pivotal.

Strategic partnerships with experts allow your business to access these resources without requiring extensive in-house recruitment.

If you’re considering outsourcing, use a balanced approach between managing costs and accessing innovative solutions.

Consider forging agile partnerships beyond cost considerations, departing from traditional outsourcing motivations focused on cost reduction and operational efficiency.

Andrew Collis, CFO at Moneypenny, tells Sage Advice: “Outsourcing non-core functions has become increasingly prevalent in businesses, and this trend is poised to strengthen in 2024.

“In the past, the driving forces behind this surge were to reduce expenses and enhance operational efficiency.

“However, disruptive outsourcing is now about collaborating with partners to integrate services that organisations cannot rapidly develop independently.

“This approach aims to drive innovation, fuel transformation, and propel growth.”

11. Strengthening relationships with C-level peers

You may see CFOs evolving into integrators that build bridges between departments for better business outcomes.

Dizmo and Planisys CFO Christoph Ott says: “Encouraging cross-department collaboration will significantly benefit you, especially in a defensive economic climate.

“The CFO’s role in deciding where to prioritise investments and where to make cutbacks requires close collaboration with the CEO and a strong rapport with leaders across the organisation.”

He recommends expanding your traditional CEO-CFO partnership to include closer ties with other C-level peers.

Working with other leaders, you can ensure that financial strategies are well-aligned with broader business goals and operations.

This collaborative approach provides deeper insights into various aspects of business operations, from marketing strategies to cybersecurity, enhancing overall financial and operational performance.

On this collaborative necessity, Prophix CEO Alok Ajmera says: “The CEO-CFO partnership has traditionally been strong, but expect closer collaboration in the year ahead between the CFO and other C-suite peers, including the CISO, CMO, and CHRO.”

Collaborating with leaders of other business-critical areas will give you greater insight into what’s driving overall performance—and where there’s room for improvement.

“For example, by collaborating with the CMO, a CFO can better understand marketing spend, conversion rates, and yield to determine where new measures could be implemented for increased efficiency.”

Amy Spurling, CEO of Compt and a former CFO, underlines the importance of building strong partnerships with HR.

She advises CFOs to collaborate with HR departments early and often, recognising that HR holds valuable insights into productivity and retention challenges.

By aligning financial and people strategies, you can drive more efficient resource allocation and support the business in a capital-efficient manner.

Amy says: “HR has incredible insight into your organisation’s inner workings—which teams are the most productive, where you struggle to retain people, etc.

“The biggest expense is frequently team costs, so by partnering with HR and working together, you can find better ways to support the team in a capital-efficient way.

“This partnership can be a superpower.”

12. An increasing role of finance in ESG initiatives—or put on the back burner?

With new regulations and reporting directives, CFOs will be at the forefront of ensuring compliance and accuracy in environmental, social and governance (ESG) reporting.

This involves tracking and monitoring key sustainability performance indicators and data to meet business targets and regulatory requirements.

As ESG becomes more integral to business strategies, you may be crucial in steering these initiatives.

Rohlik Group CFO Vineta Bajaj says: “With many regulations and reporting directives in the EU {European Union] on ESG around the corner, the accuracy, tracking, and monitoring of key KPIs and data to ensure that the business targets are met was, is and will continue to be a key focus for the finance agenda and CFOs.”

But Prophix CEO Alok Ajmera predicts: “We can expect North American businesses to increasingly deprioritise their ESG initiatives as they turn their attention to more ‘urgent’ matters like optimising their operations and driving profitability.

“While some North American businesses in industries like consumer goods may still lean into ESG activities to reflect voice-of-the-customer feedback, other industry leaders will direct their urgency first and foremost toward ensuring the durability of their business, placing ESG on the back burner.”

13. Better people management and hybrid working models

CFOs can get involved in the better management and training of people.

Christoph Ott says: “Despite economic challenges, the persistent shortage of well-trained and highly motivated individuals calls for CFOs to continue improving their leadership skills.”

So, fostering an environment where employees are motivated to upskill and grow becomes paramount.

Christoph adds: “Operating in a proactive ‘driving mode’ instead of a reactive ‘survival mode’ will be key, signalling to the finance department that change is an opportunity for evolutionary growth.”

On reactiveness, Osprey Group CFO Lewis Dangerfield highlights the importance of adapting to hybrid working models.

Lewis says: “2023 was the year we started to settle into a new normality of hybrid working, which created some tensions within organisations as they grappled to understand what this meant for collaborative working, costs, and efficiency.

“I think 2024 will be a period where CFOs need to support businesses to embed an approach that fits the organisation’s needs and the workforce’s expectations.

“Strong change management is needed to take some more resistant business leaders on the journey.”

14. Rethink assumptions and be ready for adaptation

With the pandemic and subsequent global events, CFOs must question long-held beliefs.

This extends from reassessing work environments and technological adoption to personal decisions about lifestyle and values.

CFO Eugene Moorcroft of Servicon says: “If we’ve learned anything recently, our assumptions about the world need constant re-evaluation.

“You must be ready to adapt, not just in your personal life but in every business decision you make.”

Think about:

  • Workplace evolution: The traditional office gives way to flexible, results-oriented work settings.
  • Technological integration: AI and automation are becoming essential in the modern workplace.
  • Career mobility: People increasingly seek roles that align with their evolving values and aspirations.

Affordability, sustainability, and societal perceptions reshape major life decisions and affect customers’ lives.

Eugene notes: “The uncertainty of our times has shortened decision-making timeframes, encouraging a bolder approach to life and business choices.”

In this changing landscape, Eugene suggests CFOs ask themselves: “How have customer needs evolved? Are there shifts in expectations that need addressing?

“Does your brand still connect with your audience?

“Look at your business with fresh eyes and question the status quo. Does what you know about your business still hold ground, or has the world moved under your feet?

“Start by rethinking assumptions.”

Final thoughts: Embrace the future with resilience and vision

CFOs are the unsung heroes, adeptly managing an ever-expanding array of responsibilities—a trend set to continue.

Though this is certainly challenging, it presents a unique opportunity to reshape the narrative of finance leadership.

You can be the strategic architect, weaving the fabric of resilience and adaptability into the very core of your business, bringing a human touch in a digitalised world—empathy and insight to every decision.

You can become whatever you want—a harbinger of change, a champion of sustainability—the bridge between the present and a dynamic, hopeful future.

In your capable hands, your business doesn’t just have to survive. You can help it thrive, innovate, and set new benchmarks for what it means to be truly transformative.

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