Last week, I got a call from Eric Krell, who also blogs in this space for Business Finance. He had been hired by a professional association to research the question: What will the finance function look like in the year 2020? He figured that because I have spent years writing about the role and people of finance, I’d make a good mark.

I do not opine about finance in the cloud and that sort of thing. But I do, always, wonder about finance/accounting people and their skills sets and how they evolve in response to changing business conditions and investor appetites for risk and reward.

What I now see is evidence of bifurcation: the analytical types in one corner and the transaction process-owners in the other. The analytical types are the darlings these days: stroked by the higher ups for their innate brilliance as they ply analytics — models, metrics, swim lane diagrams — to uncover the granular drivers of profitability.

Take, for example, Dave, a smart and cheerful fellow who works for a giant conglomerate that makes everything from specialty tools to motion control sensors. He had been assigned to drive a detailed cost analysis to shed light on the true economics of an industrial sale. He explained how he not only had discovered hidden cost drivers but had created a set of online calculators that the sales team could use when negotiating prices, payment terms, and payment options with customers. Among other things, these tools helped to identify and adjust for differences in payment habits in different regions. So, European customers might have to pay a bit more than U.S. customers because they typically take longer to pay their bills. Common sense, for sure. But the neat trick here is that Dave was able to build and deploy a handy model used with the click of a mouse that institutionalized financial discipline across the enterprise.

Fast-forward to 2020

We should expect the analytical types like Dave to become increasingly specialized in their knowledge and reach in coming years. Whether deep into hedge accounting, global tax rate forecasting, risk pricing, or modeling the incremental growth in product profitability, finance’s analytical specialist will help the CFO turn over every rock looking for another drop of economic profit. With nobody predicting a return to robust revenue growth any time soon, this hunt will surely remain a top priority.

Are there downsides to finance specialization? That’s a topic I’m trying to sort out — and I’d love to hear any and all ideas you may have. It’s tempting to think about analogies to the field of medicine, where specialization has delivered clear positives (mind-boggling breakthroughs in disease treatment options) but also negatives, such as spiraling costs.

I also wonder about where tomorrow’s CFOs will come from if all the young stars become specialists. Will their mentors remember to push them into leadership development training? What about the ability to read and influence people, those core social skills so vital to the modern cross-functional collaborator?

Meantime, what will become of the people who manage the engine rooms of financial transaction processing? I recall Greg Hackett in 1995 declaring, “Ten years from now, financial transaction processing will be a lights-out operation!” He was a bit early with that prediction, but I suppose it’s not too far-fetched to imagine financial transactions in 2020 being done in the dark by server robots. ###