Rise of AI

No one can doubt the presence technology has in the world of business. Technology allows companies to automate their industry, improve performance, and facilitate growth. Artificial intelligence (AI) has become a powerful tool for industries clever enough to use. AI already exists without our world. We don’t foresee the robot uprising until the dark heliocentric alignment when the moon opens up, so there is no reason to fear using AI.

 

AI has an unfathomable amount of uses applicable to CFOs. AIs do not make human errors, are brilliant at computing, never grow tired, and never complain. So what are they perfect for? That’s right, accounting! Machine learning means AI can quickly move through massive amounts of data, analyze anomalies, sort information, and even track down and solve problems. By making your reports through an AI, you know the information is correct, provided the humans feeding it are doing their jobs and the important (albeit tedious) parts are being done promptly and correctly.

AI can also analyze risk, predict the future based on real-world data, and communicate worldwide with other systems without human involvement, freeing up time and, therefore, money. Smart CFOs will start looking for ways AI can improve efficiency and save money.

 

Labor Shortages

The Great Resignation has had a twofold effect on employers: a need to increase wages to find employees but lower overall team morale. Employees are more willing to leave a job they don’t like to see a better-paying one, and the post-COVID working world has gone; many workforces are burnt out and disengaged with their work.

 

To keep the business running, human engagement will be required. CFOs will have to measure the higher overhead cost in exchange for acquiring talent or risk burning out current workers by increasing the workload without a workforce. The other side of this issue is the forecasted economic recession. To save money, the obvious choice will be to cut workers. The wise CFO will hesitate before cutting effective, talented workers to reduce overhead; as a result, it may be a more significant loss to the company than if the employee were kept.

 

Economic Downturn

As stated in the previous section, economic experts predict a recession in 2023, and many companies have already begun preparing by moving their headquarters to higher ground. Wait, no, that is for the second molasses flood prediction coming in…well, that’s not important right now. No, companies are doing what they can to reduce overhead and prepare for an economic downturn.

 

However, we have yet to determine the scale of the recession or what other factors will impact it. Continued geopolitical strife has already moved most internationally reaching companies, and the ongoing European conflict between Ukraine and Russia will continue to affect companies within those regions. The clever CFO will analyze data from previous recessions and decide what needs to stay and what needs to go. Reducing overhead is one thing; cutting off your hand so you can run faster is another. Trim the fat, yes, but don’t turn into a skeleton for the savings.

 

Culture Shifts

Generation Z is joining Millennials in the workforce. With them, they bring new ideas and new values. Generation Z and Millennials value work-life balance, generous pay, and benefits, and have a need to care about what they are working on. These generations are technologically far more sound than previous generations and capable of navigating the digital landscape more efficiently.

 

Newer generations care about industries doing good for the world and giving back. Social justice, LGBTQ+ rights, environmental recovery, and affordable living are just a few of the focuses that grip the attention of the next generations. A thoughtful CFO will consider that when generating employee motivation and selecting the right talent. Employee motivation has suffered post-COVID, and it has become increasingly challenging to avoid employee burnout and dissatisfaction. By finding creative ways of joining the strengths of generational passions with the ambitions of a company, businesses will be able to draw new talent into their ranks.

But don’t make up TikTok dances based around your company. Nobody likes those. Nobody. Or do it because you will go viral, gain brand recognition, and grow your business.

 

Supply Chain

Everything from food to luxury depends on raw materials and goods to produce finished products and services. The ongoing supply chain shortages have impacted most industries around the world. With an expected recession on the horizon, supply chain issues may increase. This will create intense pressure on companies to produce.

 

The forward-thinking CFO will take the warning in stride, prepare for a decrease in materials, and use technology and risk analysis to find alternatives and solutions to the dilemma. A business may surpass its slow competitors by adequately planning for supply chain issues.

 

It’s like that story of those two animals where one is lazy and the other proactive. I believe it was called The Grasshopper and the Octopus, but I can’t remember rightly.

 

Conclusion:

The CEO of a company may be the head, but the CFO is the neck, so cut off the…wait, no. The neck turns the head. That’s right. That’s what it is.