AI infiltrates the finance functionby
While AI is making significant in-roads into the world's finance departments, it will take additional effort to develop new skills to realise the technology's potential to support better decision-making.
Artificial intelligence (AI) is playing an increasingly prominent role in corporate finance departments, but in-house accountants are struggling to understand how the new tools can help them make more informed decisions.
That was the primary conclusion of a study by European business software house Unit4 in its recent study into Finance, AI and the future of decision making.
To compile its report, the company conducted a survey of 1,760 finance decision makers in Australia, Europe, America and the UK.
Half of the survey respondents said that AI was being used by their organisation’s finance department and seven out of 10 said they had some knowledge of what AI will mean for company accountants.
The study uncovered evidence to suggest that AI early adopters were outperforming their peers, with 47% of those using AI reporting that their companies were performing strongly, compared to 28% of non-adopters. Looking ahead, 43% of AI adopters anticipated their strong position to continue for the next 12 months, compared to 21% of non-adopters.
Implications of AI for finance
More than eight out of 10 finance team respondents (83%) saw a future developing where their team would become more involved in business strategy as data replaced instinct as a foundation for decision making and 75% expected their day-to-day activities would change over the next two years.
But the realities of applying new technology are always a little more complex than headline numbers, the study acknowledged. Only a quarter of the finance managers polled believed technology would help colleagues make decisions faster and 24% thought it would deliver insights to support meaningful decisions.
“It’s more likely they are convinced of the need for these tools without fully recognising the benefits or how they work,” the study concluded.
If finance managers are going to play a more strategic role, they will need to use AI in more sophisticated ways, the report continued. Rather than installing new, high-tech systems and training up their teams to pull the levers, finance managers need to devote more attention to strategic leadership skills.
For example, only a quarter of respondents said inter-personal and influencing skills would be key skills in the future and 21% saw storytelling as important:
Critical skills for accountants of the future
|AI/Machine learning and related tech||38%|
|Traditional finance skills||29%|
|Data visualization skills||28%|
|Dashboard skills and real-time reporting||26%|
|Sector or industry knowledge||25%|
|Interpersonal and influencing skills||25%|
Communication as important as tech
“From our experience, if finance professionals want to play a more strategic role they must have the business and leadership skills to identify what the business needs to prioritise to succeed,” said Georgina Kossivas, chief financial and risk officer at the Nuclear Waste Management Organization.
“Communications skills are also incredibly important to articulate insights in terms that are relevant to senior decision makers. Investments in AI will only deliver on their true potential if finance professionals have developed these skills sufficiently.”
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