Sitting on a sofa in his office in San Francisco, Dr. James Canton is pondering the future. Specifically, he's mulling the technologies he believes will drastically alter the business landscape over the next half-decade. Suddenly, midthought, Canton comes out with a startling statement. ''The CFO of the 21st century,'' he says, ''needs to understand technology better than the CIO of the 20th century.''
That's a sobering prediction, particularly coming from Canton. This is not some pie-in-the-sky crackpot. Canton is president of the highly regarded think tank, the Institute for Global Futures. Moreover, he was a White House advisor on science and technology, as well as a consultant to a raft of Fortune 1000 companies. In short, when it comes to business technology, Canton has a pretty good idea of what's what.
And frankly, what Canton foresees is a little unsettling. Innovative technologies, he says, will be cropping up at an almost overwhelming pace. ''There has been more technology innovation in the past 50 years than in the previous 5,000.'' That's a lot for any finance manager to contend with.
It won't get any easier, either. According to Canton, computers, networks, biotechnology, and nanotechnology will be the power tools of the new millennium. Each development feeds another. ''Technology is causing a rapid design of new products, business models, and markets,'' he says, ''with all eyes on the needs of the emerging customer.''
Ironically, while whiz-bang products will arrive at a regular clip, few of the underlying technologies will be overnight successes. At Xerox's Palo Alto Research Center, Nick Sheridon is working on electronic paper. Although he spent the 1980s focused on other projects, he began the paper chase back in the 1970s.
But for CFOs, the quest -- and the question -- is more immediate. Which leading-edge technologies should a company adopt; which can be ignored?
Unfortunately, emerging technology comes with no guarantee. The good news is that common standards and vendor collaboration are becoming more widespread, so it will be harder to misstep than back in the days of proprietary solutions. The bad news: Innovation does not come cheap. According to the London-based Computer Business Review, companies will have to spend 40 percent of their operating budgets on IT just to keep up with competitors. To stay ahead of the pack, the figure rises to about 60 percent.
That puts the CFO squarely in the hot seat. CEOs may be dazzled, but few projects will get off the ground without the CFO's imprimatur. Innovation, it seems, still needs a little tire- kicking. ''Companies shouldn't be overwhelmed by the hype of emerging technology,'' says Les Hales, director of Gartner Group in Hong Kong. ''This is still 80 percent a business issue.''
Which brings us back to Canton's prediction about the 21st century CFO. If he's right, finance managers have some catching up to do. Toward that, we interviewed scientists, gurus, and industry prognosticators. We asked: What technologies will change the way companies do business over the next five years? We purposely limited the time frame. We weren't looking for science fiction here, but rather, real innovations that will have a real impact on real corporations.
Here then are 10 technologies the experts say every CFO should know about. We've listed the choices according to the estimated time of wholesale business deployment -- from sooner to latest.
1. Body Heat
Biometric security ETA: 1.5 years
Bandied about for some time, biometric technology is becoming a reality. Biometrics enables a computer to confirm an individual's identity based on a stable physical trait, such as face, fingerprint, or iris. Once a device like a Webcam or a fingerprint pad captures an image for measurement of the appropriate body part, a software algorithm converts it to a digital code.
At its simplest, biometrics should make computer networks more secure -- and will reduce the theft of information and capital assets. Beyond that, scientists believe the technology -- which combines security with convenience -- will ease consumer fears about purchasing over the Net. Says Dr. Joseph Atick, CEO of Jersey City, New Jersey-based Visionics Corp., a specialist in face recognition technology: ''There is nothing to remember and nothing to leave home without.''
Fingerprint verification may be less sexy, but it has plenty of support. Santa Clara, California-based Veridicom Inc., for instance, was set up to create commercial applications for the biometric advances made at Lucent/Bell Labs in Murray Hill, New Jersey. And last November, Japan's NEC started fitting desktop PCs with fingerprint readers. A user can't log onto the computers without fingerprint verification.
Some companies have already embraced biometrics. San Francisco-based InnoVentry Corp., a subsidiary of US bank Wells Fargo, uses Visionics' FaceIT technology. The system enables InnoVentry to offer ATM-based financial services to customers who normally would be considered bad credit risks.
2. Smart Money
Cashless consumerism, smartcards ETA: 2 years
We know -- financial institutions have been pushing smartcards for years. A smartcard looks like any other plastic card, with one major difference: Embedded in the plastic is a microprocessor capable of carrying out a range of security processes and holding information relevant to the card holder. Unlike conventional magnetic-stripe cards, a smartcard can verify PINs entered by the card holder and securely authenticate itself to payment terminals, without reference to a computer network.
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