It can be both thrilling and terrifying to embark on a new journey. The good news, it seems, is that you might not need to start entirely from scratch. Today marks one of those occasions, with the launch of Beck Anderson Research. While the name on the banner may be different, the perspective, insights, and approach to new ideas is not. With this inaugural post, I’d like to highlight some of the key areas of financial operations that I’ll have my eye on in the weeks, months, and years ahead.
I’ll start with four big topics that I think deserve a lot of attention due to their potential business impact. While they are by no means the only topics you should keep an eye on, I think they’re all worth your consideration. That’s because, in their own way, they all drive right to the heart of the business: to revenue generation and cash flow. Let’s dive in!
Discounting and Supply Chain Finance
We’ve been talking about the potential of discounting and SCF for years. Now there’s some real momentum in the space. Firms like Taulia and PrimeRevenue have done a great job in educating the market about what’s possible for supply chain finance and beyond. C2FO is bringing innovation to the discounting space with a marketplace approach to supplier-driven discount offers. Invoiceware is building on their Latin American invoicing expertise by adding supplier finance to the mix. It’s only a matter of time before Ariba gets in the game as well. There are a lot of signs pointing towards increased activity (and enterprise adoption) of these programs in the coming years. And with the potential benefits to participants on both the buy- and sell-sides of trading partner relationships, I’m excited to see it continue.
P2P Automation and Working Capital Management
I think that when it comes to the connection between efficient AP and working capital opportunities, a broader array of people now “get it.” By that, I mean that folks outside of AP see what’s possible and recognize that invoice processing is the gateway to substantial savings and working capital flexibility. It’s something that has been brewing for a while, and that some of us have been “encouraging” others to recognize. It came out in casual conversations at last year’s AFP conference in Washington. It was front and center at sharedservicelink’s event in Scottsdale, and it’s on the agenda for Nvoicepay’s upcoming gathering in California. It’s gotten big enough that it’s caught the attention of NACM and FCIB as well — and their constituents are the receivables side of the fence. With greater recognition–and the continued push towards process efficiency that we all seem to be embracing–I think there are big things in store for the P2P automation space. Things that go far beyond the cost-per-invoice metrics we’ve been focused on for the past few decades.
XaaS and Recurring Business Models
I am a big fan of the catch-all acronym XaaS, for “anything as a service.” It’s so much better than continuing with the proliferation of different variations like SaaS (for software), IaaS (for Infrastructure), PaaS (for Platform), and a host of others. To me, it’s also a lot more inspiring; it’s limitless. What we’re seeing now is a boom in different service-based offerings, things like over-the-top entertainment services like Netflix, Hulu, Spotify, and Pandora — and innumerable others that are becoming commonplace for those who are far younger and far hipper. But this isn’t a purely consumer-oriented phenomenon. Adobe’s Creative Cloud moved desktop software to a subscription-only model. Microsoft moved our Office to the cloud as well. Everyone, it seems, is looking at their business not in terms of what it makes, but in terms of what it “knows” — the accumulation, analysis, and dissemination of data is driving new business lines we wouldn’t have envisioned a few years ago. This is where firms like Aria, goTransverse, MetraTech, Monexa, Zuora, and many others are focused. Traditional technologies for revenue recognition, enterprise performance management, and billing just weren’t cut out for this. It’s going to be fascinating to see how it all develops.
The Internet of Things
This is possibly the biggest buzzword (or buzz-phrase) in recent memory. At base, it’s an extension of the ideas of industrial machine-to-machine communications, applied to every conceivable object in the business and consumer world. Things keeping track of their own conditions and environments, exchanging information with other things, reporting back to centralized servers, and allowing the mass storage and analysis of data. It’s the underpinning of the “smart, connected products” that folks like Ericsson, IBM, PTC, Siemens, and others all have their eye on. It’s also inextricably linked with the XaaS and recurring revenue models above. We’re in the early days yet, and no one really knows where this all is headed. What’s certain is that the technological evolution is opening the doors for new services, new revenue streams — and new sources of headaches for those finance folks who need to keep the books in order!
Those are the big four, from my perspective at least. As with any limited list, there will be important developments that aren’t captured here. We’ll likely see some changes in approaches to international trade finance. There’s always room for discussing things like credit insurance and bank payment obligations. Who knows, there very well could be a paradigm shift in treasury systems and bank account management. I can’t rule any of those out. But for my money, I’d be comfortable betting that these four items will give us plenty to talk about for years to come.
Until next time,