This Industry Outlook is a portion of the 2019-2020 Arizona CFO Spotlight Survey Report
Levels of Optimism: High
Because the environment is still healthy for mergers and acquisitions, financial and professional service firms are focused on value and staying lean—whether they are acquisition targets or the acquirers.
BOK Financial completed its acquisition of CoBiz Financial, Inc. in late 2018, essentially creating a major footprint to expand financial services market share in both Arizona and Colorado.
CFOs are taking on more duties in technology, human resources and operations (beyond traditional financial roles) in order to understand key performance indicators and the firm’s unique market position. More hiring is happening for specialized skills, including skills outside of traditional professional degrees. For example, accounting firms are investing more in the growth of advisory services ranging from technology and government contracting to business valuation and succession. To augment these services, they are sometimes hiring professionals without accounting degrees. While there is still high demand for tax and audit professionals, it is just one piece of the industry’s focus.
“Professionals are doing a self-check to handle the growth. ‘Is it sustainable? If we double our footprint or team, what does it look like?’ They are not just opening offices like they did in 2005 and figuring it out; they are much more strategic on execution.”
Professional Services Influencer, Phoenix, 2019
Hiring is happening outside of Arizona for remote work arrangements or through old-fashioned head hunting. To this end, calling officers are experiencing a resurgence in demand, providing leads on talent as well as research and identification of warm leads nationwide for busy executives.
The demand for “moving money” instantaneously is growing at a much faster pace than traditional banking or lending services.
Financial service leaders don’t anticipate a slowdown in the economy until late 2020. Corporate and residential clients are still locking in rates for capital and mortgages in anticipation of purchases. Individuals with more cash due to business sales or exits are looking for higher-yield alternative investments ranging from real estate to emerging market opportunities. Banks specifically are seeing opportunities to expand cash management services and wealth preservation opportunities for their customers. According to insiders, the demand for “moving money” instantaneously is growing at a much faster pace than traditional banking or lending services.
Like other industries, professionals in Arizona are trying to anticipate their future. They are investing in market and brand research to clarify their brand perception and reputation. By analyzing market threats and opportunities, they hope to ensure solid footing if and when the economy slows down. Included in their forecasting are investments in data security, better ERP tools and online marketing automation to support new business development.
Prospects look good for this industry, but it is highly competitive and often price sensitive.