Continuing our series of procurement and supply predictions, today let’s look at what global payables automation platform Tipalti has to say.
With thanks to Manish Vrishaketu, Chief Customer and Operating Officer.
Overall commentary
The COVID-19 pandemic has created a number of profound changes in the fintech space, accelerating the growth of e-commerce, cloud and digital industries. Physical checks and other paper-based formats are quickly being replaced by digital, contactless solutions. With finance teams no longer able to work together at the office — and the return date still unknown — the need for automation has never been clearer. Enterprises want quick, efficient solutions that enable them to do more with less. From lending decisions and risk management in payments to underwriting a business for insurance and automating mortgages, only automation can provide the necessary support businesses need.
Going into 2021, business leaders will be required to manage uncertainty caused by the pandemic, changes in the political landscape or any other possible source. They’ll need to be agile and have enough flexibility in their business plan and models to quickly respond to changing environments. They will also need to consolidate finance functions to create synergies and efficiencies wherever possible. Lastly, they’ll need to think ahead and new business models will surely come out of these challenging times.
1. Fintech trends in 2020 and beyond
This has been an unprecedented year for the fintech space, and there’s no denying the significant implications of COVID-19. The pandemic has single handedly accelerated e-commerce, cloud and digital industries. We saw fintech players quickly respond to that with more investments in modernizing payments, banking, lending and moving away from paper checks. Several new, direct-to-consumer and mobile-only banking options have begun to emerge. There has also been notable growth for digital payments both in the consumer (P2P) and business space. These trends are likely to continue in the years to come, but fintech companies aren’t the only ones taking action. Some countries have also acknowledged the need to adapt. In 2021, banks in New Zealand plan to stop supporting the use of paper checks as a payment method. But checks won’t disappear overnight, so it will be imperative for businesses to tighten their belts and rely on a solution that can provide a competitive rate.
2. How automating AP will evolve in 2021
Automating AP is becoming a strategic imperative for several reasons, first because finance teams can no longer operate in physical groups and within offices. As a result, anything that is paper-based — such as invoice collection, processing and check writing — is very difficult. This trend is forcing companies to look to automation for a quicker, more efficient solution that can serve them in a virtual working environment.
Another notable trend is the rise of globalization. There are going to be winners and losers in the coming year, just as there were in 2020, and this will inevitably leave many companies exposed to potential buyouts. It could spur M&A activity as larger firms acquire those that aren’t performing as well, creating more multi-entity structures. We have also seen significant acceleration/growth across e-commerce, gaming, mobile and streaming — in other words, shopping and entertainment verticals that can be easily accessed at home. These industries tend to have a global mindset, and for them having an AP platform that can not only automate and create efficiencies but also grow with them as they look to scale globally is crucial to their success. Thus, the need for global AP platforms will increase.
3. Consolidation of finance functions
CFOs are looking at consolidating finance functions that prevent them from having to deal with each one separately: AP, AR, Banking, Lending, FX, etc. They are looking for platforms that can extend beyond AP automation because several of these workflows are correlated. For example, global companies that manage AP locally still need to fund their subsidiaries for them to complete the process at the local level. Traditionally, this has been seen as a treasury function, but it’s a part of the same flow and even the same platform can help them manage cashflow across subsidiaries and process AP locally. Doing so will improve efficiency and provide better control for CFOs and other finance leaders.
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And in further coverage, let’s hear what workforce management experts Workforce Logiq has to say.
With thanks to Jim Burke, CEO.
1. Total talent management will see more action and less buzz words
Procurement and HR were forced to work together amid the Covid crisis, shining a spotlight on the previous lack of communication. Holistic approaches to talent management have become more widely embraced and will continue to take precedence in 2021. Total talent management will provide the insight needed to achieve better transparency, management and cost efficiency across the workforce.
2. Hiring will be faster and easier if leaders embrace the right technology and strategies
Companies that have predictive data and insight at their fingertips to drive confident decision-making, benchmark progress, and contextualize hiring and retention performance will be at a significant advantage, allowing for expansion of talent pools and more efficient hiring programs, even in the wake of an uncertain market.
3. The HR function will increasingly be recognized as a true business partner
The C-suite has talked a big game on the importance of HR, yet it’s typically one of the least-funded departments. We will see this “talk” turn into “walk” in 2021 as organizations embrace drastic workplace shifts and lean on HR to lead the charge in aligning workforce-related initiatives with broader business goals.
4. The role of Diversity & Inclusion leaders will be elevated
The role of Diversity & Inclusion (D&I) leaders will be elevated as executives are held accountable for tangible progress. US companies rushed to hire Chief Diversity Officers, but limited resources, funding and accountability measures prevented real progress and led to high turnover for these roles. We’ll see more companies tie executive pay to meeting D&I goals, giving D&I leaders the floor.
Thanks to Tipalti and Workforce Logiq, and look out for more solution provider predictions over the coming week, with an overall take on the series from our analysts at the end. See all of the 2021 vendor predictions here.
*Please note that the order of vendor predictions in this series is based entirely on the order in which they dropped onto our digital doorstep, nothing more.
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