Sage Chief Technology Officer Klaus-Michael Vogelberg talks about the role chatbots, collective intelligence and blockchain will play at start-up and scale up enterprises in 2017

Sage, the market leader in Cloud accounting software, has predicted that chatbots, collective intelligence and blockchain are some of the big technology trends that will change the way entrepreneurs run their businesses in 2017. Sage Chief Technology Officer, Klaus-Michael Vogelberg, said: “As every business – big or small – is transforming more or less intensively into a tech-enabled business, today’s entrepreneurs should be on the lookout for the opportunities these technological developments can bring to their business.”

Vogelberg sees six major trends in 2017 that could make a big difference to the way business builders will work in 2017 and beyond.

Trend #1: Chatbots and autonomous interfaces

Autonomous interfaces such as chatbots or digital agents will become increasingly common on different devices and user interfaces which entrepreneurs use to manage and control their businesses. These interfaces will dramatically change the way that humans and computers work and interact with each other. While, in the past, people used a keyboard or mouse to interact with their PCs, they will gradually start talking with their systems or using gesture control such as hand, head or eye gestures to interact with them.

The user experience will not only become more convenient but also more enjoyable – these systems will work autonomously and have self-learning capabilities. Eventually, software could act without user intervention, or ask a certain question only once and use this information for all further activities.

In June 2016, Sage launched the first accounting chatbot, PeggTM. Pegg acts as a smart assistant that allows users to track expenses and manage finances through messaging apps such as Facebook messenger and Slack. Pegg hides the complexities of accounting and lets entrepreneurs manage finances through conversation, making the process as simple as writing a text. By digitising information at the point of capture, it takes away the hassle of filing receipts and expenses, eliminating the need for paper and data entry.

Trend #2: Artificial & collective intelligence

According to Vogelberg, artificial and collective intelligence is another major trend to look out for, even for smaller companies. With mushrooming data volumes being generated by all sorts of sensors and devices on the one hand (see trend #6), and computer power and special analysis software and intelligent agents becoming increasingly affordable and powerful on the other, companies need to find ways to extract knowledge from today’s wealth of Big Data.

Sage’s Klaus-Michael Vogelberg therefore advises SMEs to “team up”. “If small and medium-sized enterprises join forces and – while considering their corporate data protection policies and personal rights laws – share, for example, computer power and data with other companies in a structured and systematic manner, they could profit from this collaboration by receiving a better and larger data pool and superior data intelligence. Similar to crowdsourcing mechanisms, this enriched data pool would enable companies to better understand how customers behave, what they need, what to offer them and the business areas to invest in.”

Trend #3: Blockchain – or how to create trust in the digital age

According to Sage, business builders should also carefully analyse if, and how, the new blockchain technology could impact their current business models. Particularly all those industries which work as intermediaries between two parties – such as lawyers, notaries, or real-estate or financial brokers – could be affected by this new, innovative approach.

Bookkeepers and accountants might also be affected in the way they do business in the future, as blockchain has the potential to eliminate a significant part of the workload – such as checking and booking transactions, transferring money or paying invoices – handled by these professions today.

Why could this happen? Blockchain organises transactions of digital assets between two parties in a radically new way. Instead of using middlemen or intermediaries such as banks, notaries, state authorities or trading platforms to legitimise the exchange of certain assets – such as digital properties, digital trading goods, digital contracts, or even financial transactions via digital currencies such as Bitcoins – blockchains allow individuals to transfer these assets in a direct, safe, secure, and immutable way between each other.

A decentralised, distributed ledger, essentially an asset database shared across multiple participants, combined with crypto-economic algorithms serve as the technological basis of a blockchain. All participants of a blockchain (so called nodes) have access to the distributed ledger, which contains an inventory of all the relevant digital assets.

All parties within this network have their own identical copy of the ledger. Any changes to it are applied to every copy in a matter of minutes or even seconds. Thus, the system is transparent and creates trust among all nodes without the need for legitimisation by any other third party authority.

Trend #4: Revolutionizing the movement of money
The way people use money and transfer their payments from one account to another has already changed dramatically: at the frontend, in-app payment solutions nowadays enable users to effortlessly make one-click payments and purchase goods via mobile devices or websites. This functionality is already available in many apps today. But at the backend, systems such as accounting software are less user-friendly and less integrated.

For example, companies currently have almost no possibility to make one-click invoice payments or easily manage their financial transactions between partners, suppliers and their bank with a fingertip.

In 2017, more and more new solutions will allow companies to establish an end-to-end payments value chain with their suppliers and customers. These new solutions enable ubiquitous anytime anywhere, immediate and omni-channel payments and will be fully integrated into the financial accounting systems of tomorrow’s enterprises. All parties, such as e-commerce platforms, banks, fin-techs or partners, will profit from open API standards which will be used for creating new services and enable seamless, fully-automated processing of payments and financial transactions.

At Sage Summit in July 2016 Sage announced its partnership with US Bank, a technical example for this paradigm change in payments. The  HYPERLINK "https://smallbiztrends.com/2016/07/sage-partner-us-bank-cash-flow-statement.html" AP Optimizer for  HYPERLINK "http://www.sage.com/us/sage-live" Sage Live that Sage built in partnership with U.S. Bank marks a first truly digital accounting and payment solution that enables start up and scale up businesses to manage their cash flow through dynamic integration with customers. AP Optimizer is integrated in Sage Live and determines for example the best time to pay bills and the best method for payment to optimise cash flow in near real-time, and then carries out the payment.

Trend #5: Platform-based infrastructure

In 2017, more and more SMEs will replace their stand-alone, on-site software systems with integrated, cloud-based software solutions that operate on global Cloud platforms such as Salesforce.com who are offering their users access to a wealth of business apps and integrated services. Moreover, companies will also benefit from mobile-app platforms such as the one operated by the Apple Mobility Partner Program.

“The big benefit of these platforms is that they give even smaller companies access to innovative business software solutions and services which these companies would not have been able to afford five years ago.  To some extent, these types of cloud platforms are democratising the way in which companies gain access to state-of-the-art apps and smart and scalable technologies,” says Klaus-Michael Vogelberg.

“They allow business builders to discover new ways of working and give them the infrastructure needed to receive every kind of data from partners or the Internet of Things, analyze it, and then – in a “citizen developer” style – create something new and productive,” the Sage CTO says.

Trend #6: Internet of Things will create new services and job profiles

Small and medium-sized enterprises should be on the lookout for new possibilities that emerge with the realisation of the Internet of Things. Multiple data streams originating from all sorts of sensors built into e.g. machines, cars, mobile and immobile goods, clothes or even human beings (e.g. for medical monitoring purposes) will result in a true treasure trove of data, thus creating all sorts of new services.

SMEs should think about how to use these data streams to grow their business:  Mechanics will develop new services such as predictive maintenance for all sorts of technical infrastructures. Logistic companies will optimise e.g. the navigation of their truck fleets by using traffic data from many different sources including smart city data from traffic lights, streets or other vehicles. 

Concierge services will develop all sorts of surveillance services with the realisation of new smart home technology. Retail companies and shop owners might connect to smart home devices such as refrigerators or Amazon-style dash buttons to supply customers automatically and predictively with goods and services. Mobile medical care services will innovate their work with the assistance of all sorts of new devices e.g. to improve their support of elderly people living alone at home.

Early last year Sage demonstrated its partnership with TomTom telematics which enables Sage Live customers to keep track of vehicle journeys, and feed data into the accounting process in real time.

In summary, Sage Chief Technology Officer Klaus-Michael Vogelberg said: “In 2017, every business will need to start thinking of itself as a technology business. To stay competitive, they will need to grasp the opportunities that this development brings with it and change almost every aspect of today’s more or less traditional ways of working.

The good news is that this technology means that we believe that very soon, business admin could become completely invisible, as easy as messaging a friend, or even completely automated, as machines learn like humans. This will empower entrepreneurs to stay focused on building their businesses, driving growth in the economy and contributing to their communities – not basic admin.’