Will intelligent automation help boost productivity in the world of finance?

Will intelligent automation help boost productivity in the world of finance?

Will intelligent automation help boost productivity in the world of finance?
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Intelligent automation is fast becoming a crucial element in the success of businesses.

With breakthroughs in artificial intelligence, the Internet of Things and 5G, we will begin to see use cases that are not only advanced compared to available solutions but will fundamentally change how organizations operate and make decisions.

This transformation, in turn, will drive huge changes in service offerings, consumer behavior and demand. Intelligent automation is only beginning to utilize learning algorithms and learning techniques.

However, there is limited interaction with users and internal organizational interfaces. Currently, finance-related automation is driven by set rules and cannot be easily customized to changing environments.

The next generation of automation will allow more intuitive interaction and learning capabilities, leading to organic and collective efficiency gains with people and processes.

Transforming complex functions

Insights, reporting and analyses are the most important outputs of an organization’s finance and accounting function, also referred to as F&A. Organizations are increasingly moving toward making data-driven decisions based on the fundamentals of the business.

This output is based solely on how accurately the F&A function captures the operations and activities of the business.

Intelligent automation can be leveraged to make that capture more efficient on multiple fronts. This efficiency leads to more accurate reports, analyses and deeper insights, which help with better business management.

Today, more than ever, it is imperative to find automated solutions to capture operational inputs since the volume of data is increasing. In addition, companies are operating in an environment leveraging digital transformation. As a result, the complexities are also increasing. To keep up with the increased volume and complexity, organizations need to drive more significant efficiency gains at the base level of operations.

Showing them the money

The goal of the F&A function in any organization is to fully capture the inputs and outputs of the operations of a business and provide a quantitative financial narrative for management to make decisions.

If the F&A department properly integrates intelligent automation into the delivery process, then day-to-day operations could be more effective than today’s less automated processes.

The scale of automation is quite broad, and for non-automated standard operating procedures, the resource utilization is higher for tasks such as ledger entries, account reconciliations and invoice generation.

These tasks, if not automated, require a significant amount of time and resources to complete and are more prone to errors.

This is especially true for modern organizations now dealing with large amounts of data. The accounting cycle and related processing chain are thus calibrated to deal with this manual processing and then shift to more value-creating tasks once the initial processing is complete.

Mechanics of automation

Intelligent automation can be a powerful transformation driver, and there is a tremendous potential for efficiency gains to be achieved by properly utilizing it.

Currently, automation is rules-based, so it may not be ideal for certain organizations. The need for finance transformation might stem from several areas such as efficiency gains, quicker turnaround, cost efficiencies, increased volume processing, greater business complexities, regulatory requirements, or simply a combination of these.

Intelligent automation, if applied correctly, can help alleviate the process on all these fronts.

However, there is always a cost to any transformation initiative. Therefore, organizations must undergo an honest cost-to-benefit analysis of any proposed transformation, considering the upfront or visible costs and benefits and the post-transformation ones, which are usually less visible.

Considerations should be made for any changes required to match process or business changes in the future. This assessment should also consider the organization’s strategic ambitions and growth trajectory to ensure the solution is appropriately paired and has the scalable bandwidth to support and absorb any projected growth.

Intelligent automation may be applied holistically to the entire F&A function or used to create incremental gains within specific operations, including general ledger entry and reconciliation, accounts receivables process, accounts payable process and standardized reporting. This comes down to the organization’s size and its goals for transformation. In addition, employees are always looking for tools that enable them to do their tasks better.

Intelligent automation is one of the fundamental building blocks upon which AI and Web 3.0 advancements will be based.

If organizations do not invest in the fundamentals now, they will face a severe gap in implementing and aligning with available market solutions, not to mention their competitors. However, transformation should not be driven by fear but by the perspective of future organizational goals.

Omer Saleem, chief financial officer, Proven SA.

Disclaimer: Views expressed by writers in this section are their own and do not necessarily reflect Arab News' point of view