Gartner Highlights Key Considerations for Future-Proof Financial Applications

Experts Discuss Key Issues Facing CFOs at Gartner CFO & Finance
Executive Conference, June 10-11, in Washington D.C.

WASHINGTON–(BUSINESS WIRE)–#CFO–Most organizations will fail to realize the full value of new financial
application purchases because they are not accounting for digital
capabilities that they will require in the future, according to Gartner,
Inc.

Gartner experts at the Gartner
CFO & Finance Executive Conference
discussed key drivers of
financial application buying behavior and the associated challenges of
maximizing returns on new technology investments, as predictive
analytics, artificial intelligence (AI) and machine learning
capabilities will increasingly shape the needs of finance departments in
the future.

“The criteria on which financial applications are being selected today
largely do not reflect the future needs of these departments,” said John
Van Decker, vice president analyst at Gartner. “Seventy-nine percent of
financial applications buyers sought to improve efficiencies with their
solution, while 59% were seeking better business outcomes. This suggests
buyers are putting an overemphasis on simply improving their system of
record with their solution, while not accounting for differentiation and
transformation opportunities. Only 36% of buyers thought improving cost
management was a reason to upgrade their financial applications, and
just 9% cited driving revenue growth as a factor in their buying
decision.”

According to Gartner research, upgrading financial applications
solutions should result in a minimum total cost of ownership savings of
10% to 20%. Leading finance departments will seek to accelerate these
efficiencies by driving cost management and revenue growth opportunities
within their organizations. Financial applications leaders should seek
solutions that will enhance their ability to innovate, rather than
simply settling for efficiency gains.

Realizing the full value of technology investments

The purchasing of financial application software, including financial
planning and analysis, and financial close applications, continue to be
driven by ease of use, functional capabilities, flexibility and price.
This suggests that buyers largely view the market as commoditized, with
the result that the full value of these solutions is not being captured
by organizations.

“We continue to see many organizations fail to go beyond the basic
functionality of the solutions they purchase,” said Mr. Van Decker.
“Some organizations see their solution as simply an upgrade on legacy
technology and overpay for advanced functionality that they never
utilize. In other cases, a lack of training users or not thinking
through how the solution relates to their finance transformation
strategy is to blame.”

To ensure a greater share of value is achieved with their solution,
financial applications leaders should first define a project plan before
implementation. More focused solutions that feature predictive
analytics, AI/machine learning capabilities and proven acceptance
outside finance for use in integrated financial planning capabilities
should help drive the purchase decision.

Buying criteria should reflect future initiatives

Gartner research shows that financial applications leaders must support
a range of new technology initiatives from predictive analytics to the
ability to incorporate artificial intelligence and machine learning to
enhance financial analysis. Forty-nine percent of financial applications
leaders surveyed said predictive analytics was a top finance technology
initiative, while 36% emphasized artificial intelligence and machine
learning.

“When assessing vendors, it’s crucial to understand how they will
incorporate AI and machine learning into their product, as we anticipate
these technologies will be mainstream within three to five years,” said
Mr. Van Decker. “While blockchain technology remains a lesser concern to
today’s buyers, the ability to incorporate this capability should remain
on buyers’ radar screens as it will impact core financial
implementations and become foundational to the financial consolidation
process within five to eight years.”

Before selecting a new solution, financial applications leaders should
include their digital transformation strategy as part of the evaluation
process. Ensuring that a solution’s roadmap includes capabilities such
as predictive analytics and AI/machine learning capabilities will
significantly improve future processes.

Gartner for Finance clients can access relevant research and insights in “Survey
Analysis: Understand Financial Application Buying Behavior to Improve
Your Technology Purchases for Digital Transformation.”

About the Gartner CFO & Finance Executive Conference 2019

CFOs and senior finance executives wanting to learn more about the
trends that will shape finance, company performance and personal
leadership are attending the Gartner
CFO & Finance Executive Conference 2019,
being held June 10-11
in Washington, D.C., U.S. Follow news from the conference on Twitter at #GartnerFinance.

About Gartner for Finance Leaders

Gartner for Finance Leaders helps senior finance executives meet their
top priorities. Gartner offers a unique breadth and depth of content to
support clients’ individual success and deliver on key initiatives that
cut across finance functions to drive business impact. Learn more at https://www.gartner.com/en/finance/finance-leaders.

About Gartner

Gartner, Inc. (NYSE: IT) is the world’s leading research and advisory
company and a member of the S&P 500. We equip business leaders with
indispensable insights, advice and tools to achieve their
mission-critical priorities today and build the successful organizations
of tomorrow.

Our unmatched combination of expert-led, practitioner-sourced and
data-driven research steers clients toward the right decisions on the
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for more than 15,000 organizations in more than 100 countries — across
all major functions, in every industry and enterprise size.

To learn more about how we help decision makers fuel the future of
business, visit gartner.com.

Contacts

Justin Lavelle
Gartner
Tel +1 571 230 0816
[email protected]

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