Editor's note:Seth Catalli is the Chief Revenue Officer of Globality, a Palo Alto, California-based company that provides technology to help businesses optimize spending. The views expressed in this article are solely those of the author.

Amid ongoing macroeconomic uncertainty, financial planning and analysis (FP&A) managers are under unprecedented pressure to make greater contributions to the finance function and the organization as a whole.

Effective financial resource management is critical to the sustainability and growth of any organization. FP&A managers play a central role in driving this process by providing key decision support to CFOs, CEOs, and boards of directors. Their expertise lies in budgeting, forecasting, and financial data analysis, aimed at driving informed strategic decisions that not only improve efficiency and cut costs but also support business growth.

Looking ahead to the coming year, FP&A leaders who want to achieve greater results must be willing to explore new tools and strategies.

Conventional wisdom holds that the only practical way to reduce overhead is to compress the supply chain or cut staff. However, in the context of rising prices, the former is difficult to deliver significant value; as for labor costs, unless significant effort is invested in redesigning business processes, it may ultimately just outsource work, which is not necessarily an effective long-term cost-cutting measure.

A better option lies inoptimizing indirect spending. This strategy has historically been less used as a lever for large-scale cost rationalization, but it should actually be a priority. After all, most companies spend heavily on non-supply-chain-related items such as technology, marketing, personnel and facilities costs, real estate, and more. This type of spending falls under the category of "indirect spending."

According to McKinsey data,global corporate indirect spending grew by an average of 7% annually between 2011 and 2019. However, its details (and how to manage it better) are often absorbed into a vague accounting black hole. Fortunately, technologies such as AI have given us the ability to address this issue.

The indirect spending space is highly suitable for full automation—and when the right tools are applied, this automation can lead to significant cost reductions. The emergence of intelligent sourcing technology that brings machine learning into decision-making has made this leap possible.

Actively embracing the trend of indirect spending and procurement optimization will enable FP&A managers to automate corporate spend management, giving finance teams clearer insight into how and where organizational funds are used. This clearly not only aids short-term planning but also helps you guide CFOs and senior leaders in making more forward-looking long-term strategic decisions.

Automating spend management processes means FP&A managers can easily track spending patterns, identify cost-saving opportunities, and implement cost control measures. For example, Globality's AI-driven platform has helped clients automate outdated procurement processes, achieving average cost savings of 10% to 20% and efficiency improvements of 70%.

If your organization has not yet prioritized automating spend management, then as an FP&A manager, you have a unique opportunity to work with the CFO and other colleagues to drive this transformation this year. By becoming such a change agent, you can not only significantly enhance your contribution to the finance team but also help the entire organization achieve better business outcomes.