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A study of 167 finance organizations in November 2020 showed a widespread intent to invest in emerging technologies in the next three years, with cloud enterprise resource planning (ERP) being the most favored choice, according to Gartner, Inc.

“Many finance organizations are trying to figure out the digital landscape and ways to identify and execute cost savings opportunities in order to allocate more funding to digital initiatives,” said Dan Garvey, vice president in the Gartner Finance practice. “As with many business functions, COVID-19 has accelerated the pace of finance investment in digital transformation.”

While digital transformation has been a major priority for finance organizations in the past, the pace of transformation has materially changed. “Digital investment and transformation are no longer things that CFOs can take a ‘wait and see’ approach on or throw small investments at. The time is now, and CFOs need to act swiftly,” said Mr. Garvey.

Advanced data analytics, data storage, and robotic process automation (RPA) were all likely areas for investment in the next three years, while artificial intelligence (AI) and blockchain were less common responses (see Figure 1).

“It’s not surprising to see cloud ERP as the top choice for finance organizations because it is a maturing technology with clearly established benefits that offer an escape from the bloated ‘monolithic’ ERP systems of yesteryear,” said Mr. Garvey. “Advanced analytics, data storage and RPA are also all established technologies with well-proven use cases in finance.”

AI and blockchain, however, are not so well-established and for many finance organizations would pose bigger implementation problems and a less certain return on investment. Moreover, it is possible to get some exposure to the potential benefits of AI without investing directly.

“Many cloud ERP and advanced analytics offerings are increasingly offering embedded AI capabilities, and that neatly solves many challenges around integration and in-house expertise,” said Mr. Garvey. “There’s no doubting the potential of building your own AI, but is the finance organization capable of realizing that potential?”

Blockchain also has great transformative potential, but right now out-of-the-box use cases are also limited and not applicable to most of the work that the finance organization conducts. The size of the business in revenue correlates closely with its propensity to invest in AI, Blockchain or the Internet of Things (IoT).

“This is likely in part because of the sophistication of an organization’s IT infrastructure,” said Mr. Garvey. “Implementing AI, blockchain or IoT is unlikely to be simple, and there are lower hanging fruit for most finance organizations that want to drive meaningful gains with emerging technologies.”

Gartner clients can view the webinar replay: Panel Discussion: The Top 10 Finance Benchmark Metrics for 2021

Non clients can learn more about the digital future of finance here: Digital Future of Finance.

CFOs and finance leaders can participate in Gartner research and get complementary access by joining the Gartner Research Circle.

About the Gartner Finance Practice
The Gartner Finance practice 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. Follow Gartner for Finance on LinkedIn and Twitter using #GartnerFinance to stay ahead of the latest expert insights and key trends shaping the Finance function.