Artificial intelligence (AI) has impacted nearly all business functions, but the surge in automation advancements has especially great potential for the finance function. For finance teams and leaders to thrive in times of massive change and technological transformation, increased efficiency, agility and innovation is required.
With a thoughtful AI strategy, finance leaders can harness the power of AI, modern data, predictive analytics and financial intelligence to elevate the finance function and make the most of these new tools.
There are growing expectations for finance leaders to expand their role functions from standard processing, planning and forecasting to building digital organizations, guiding growth and transforming roles and functions. Establishing the right technological foundation is crucial to successfully navigate the recent economic and global pressures facing finances leaders.
IT and Finance Alignment
In today’s modern business, workflow, business process and technology are interconnected. Respectively, information technology (IT) and finance are converging to drive data and system strategies that align with business needs. To achieve projected business outcomes, IT and finance leaders must work together to drive transformation in the areas of insights, agility and talent to meet future needs and grow the business.
Shift To Cloud-Based Platforms
Modern businesses are using cloud technology to run their organizations more efficiently, better serve their customers and dramatically increase their overall profit margins. Cloud computing is an essential technology that significantly speeds up transformation initiatives. With cloud platforms, application rollouts are predominantly executed as cloud services, reducing the required resources and ensuring smooth deployments.
Increased Cross-Functional Collaboration
Large organizations require cross-functional collaboration tools to enable effective operations and alignment on business activities. As the complexity of modern financial roles and processes increases, a more interconnected, communication-centric finance team must be available to the organization to fully optimize forecasting and financial performance.
AI-Powered Automation and Analytics
With the exponential growth in data volume and the importance of governance and compliance, the role of finance is becoming one of data stewardship. Organizations need trusted data to make better decisions that drive profitable outcomes. Modern automation-powered tools such as AI and machine learning (ML) are transforming the functions of transactional processing, close, consolidation and reporting across all functional areas with accuracy, speed and confidence.
AI for Finance Transformation
In our April whitepaper, “How to Succeed at AI Strategy and Implementation: The 5 Questions Every Company Needs Answered”, we defined AI as technology that builds upon pattern recognition to make predictions, which are the foundation of robotic process automation, machine learning and natural language processing. We discussed how C-level executives view AI as the top technology that will impact businesses and further explored the top barrier to a successful AI implementation – lack of strategy.
“To succeed, organizations need not necessarily invest the most in AI, rather they need to strategically invest in AI and automation in specific ways to address specific capabilities to increase efficiency,” stated Dan Mitzenmacher, Managing Director of Digital Advisory. “Deployed thoughtfully, practically and pragmatically, AI and automation can transform your business across functions driving necessary change needed to not only sustain but compete.”
AI Use Cases for the Finance Function
AI will empower and evolve the finance function by transforming core processes, redefining collaboration and managing risks. AI use cases in finance provide organizations with the opportunity to elevate efficiencies, improve income and cash, increase accuracy of reporting and forecasting and better manage audit and compliance. Below we explore potential AI use cases in the finance function.
Robotic Process Automation is transforming traditional financial processes. Leveraging this technology enables finance departments to automate data extraction, data entry, reconciliations and facilitate compliance tasks. Standard tasks like payables, customer invoices, expense reporting and payroll management are expedited, ensuring prompt and accurate transactions, and fostering long-term loyalty between customers and vendors.
Workload Automation is transforming controllership activities. Automate intercompany reconciliations, invoice matching and eliminations and external reporting for simplified accruals, faster close and accuracy across networks.
Advanced Analytics and AI sophistication is enabling finance teams to deliver deeper insights to their organization transforming how teams approach financial planning and analysis (FP&A), budgeting and forecasting and financial reporting. Better sourced data and increased relevancy in reporting is instilling more confidence in business partnerships and allowing financial teams to be more strategic and future ready.
Maturity Modeling can be used to evaluate processes across business functions and identify where AI and automation may have the most impact. Evaluating the overall maturity of business processes within each functional area against a standard framework will further define areas of opportunity to infuse AI and automation. As AI and automation are integrated into business processes, the more business value is achieved.
For example, the finance leader at a newly formed organization may still be reliant on email and excel spreadsheets while leveraging descriptive analytics using historical data to create reliable budget and forecast models. Whereas a finance leader from a more mature organization may leverage predictive analytics, robotic process automation (RPA) and ML – structured data and predefined models – to enhance decision making, minimize risk and drive cost effectiveness. Lastly, an enterprise may leverage workload automation and cognitive analytics, utilizing unstructured data and advanced algorithms, to provide more nuanced and predictive insights for continuous improvement.
“Maturity modeling can help an organization make better investment decisions by generalizing progress estimates to determine what resources it will take to ascend to the next level,” said Mitzenmacher.
AI and Data Readiness
An effective AI strategy involves incorporating a blueprint that aligns with the organization’s business goals. With AI suggested as the key driver of business transformation and data readiness considered a key contributor to AI success, investing in and applying the right technology tools to reach an expected business outcome is essential.
“This requires a thorough understanding of AI’s potential applications and the technical and operational requirements and risks that come with the technology,” stated Mitzenmacher. “Hiring a consultant with extensive expertise in both AI and data is mission critical given these interdependencies.”
AI tools rely heavily on data to define models, obtain insights and make predictions. Crafting a powerful data strategy will involve focusing on how internal and external data is collected, managed, processed and governed. Without a comprehensive AI and data strategy in place, organizations risk failing to achieve expected outcomes.
How Cherry Bekaert Can Help
AI is forcing middle-market companies to upgrade their digital transformation efforts. Cherry Bekaert has extensive experience in developing strategies for AI deployments in practical business use cases.
Our Digital Advisory team is comprised of strategists who have broad industry experience and keen business acumen. Utilizing an agile and flexible approach, we help examine your goals with a focus on people, process, technology and culture. Our Strategic Growth & Innovation team equips you with the right AI tools to transform data into actionable insights and strategies that drive real-world results. We are here to help organizations manage risks, enable growth and support sustainable operations.
Ready to explore incorporating AI and Automation into your finance function? Contact us today.
