Report: 85% of Financial Leaders are Planning for a Recession in 2023

Highlights –

• Nearly half (47%) of finance leaders cited economic disruption as the biggest threat to the company in 2023, and 85% of them are reforecasting in anticipation of an impending recession.
• In 2023, most leaders (57%) intend to increase their spending on cloud-based planning and reporting tools, while almost half (48%) will do so for predictive analytics.

OneStream, a pioneer in Corporate Performance Management (CPM) systems, recently hired Hanover Research to study finance professionals in North America to see how they are responding to economic issues and their top goals for the following year’s budget.

The report found that the current global disruption is still impacting financial planning. Around 85% of financial leaders are reforecasting in a bid to prepare for a potential downturn. Furthermore, nearly half (47%) of finance leaders cited economic disruption as the biggest threat to the company in 2023.

Due to the impending recession, plans for recruiting in 2023 will be conservative, particularly in the accounting and finance departments. Given the current skills crisis, finance leaders will need to make additional investments in automation and digital technologies to boost productivity. In 2023, most leaders (57%) intend to increase their spending on cloud-based planning and reporting tools, while almost half (48%) will do so for predictive analytics. Thirty-seven percent of respondents already use predictive analytics, while 61% use cloud-based planning and reporting solutions.

Only 37% of businesses will increase Machine Learning (ML) spending. While AutoML technology is expected to eliminate barriers to adopting ML, AND though the cost is still a deterrent, almost half (48%) of all financial decision-makers indicate their firms want to investigate AutoML solutions. In fact, 28% of organizations have already embraced AutoML solutions.

When the respondents were asked about the top use cases for Artificial Intelligence (AI) and ML technology, 48% viewed financial reporting as the best opportunity. They saw demand planning (39%), sales and marketing optimization (39%) and sales and revenue forecasting (41%) as further opportunities for these technologies.

However, nearly half (49%) of organizations with technical and security problems claim that there is a lack of confidence in new technological solutions, which is preventing new investments.

The study, carried out in September 2022, gathered opinions from 657 financial decision-makers (from management to the C-suite) in the United States, Canada, and Mexico. Thirty-four percent of respondents work for companies with annual revenues of one billion dollars or more, whereas businesses employ respondents in various industries.