Using insight, analytics and AI to create predictability
One of the great ironies of the modern age is the fact that the only certainty, it seems, is the presence of uncertainty.
With Brexit constantly in the headlines, barely a day goes by without a politician predicting one outcome and then an expert predicting the opposite.
Further afield, the presence of Donald Trump in the White House could have far-reaching repercussions for the dominant economic system of free trade on which some businesses depend – and, indeed, which others blame for their problems. But no matter where you stand, there are tools available to help you navigate this world of uncertainty and create some predictability.
While the term “predictability” may evoke images of working out what the future holds for a business or a specific aspect of its financial health (such as its cash flow), predictions actually have to go back in time before they can go forward. In order to do this, organisations need to have large reserves of data already compiled.
However, the reason why many finance leaders choose not to do this is obvious. Spending time collecting and analysing data is a real drain, and it’s one that often slips down the to-do list when other, more pressing tasks such as payroll, investment bids and more are on the table. In fact, a survey from AccountingWEB found that only 2.2% of finance leaders focused on strategic analysis at all.
That’s where an advanced data system comes in: by letting a piece of software do the work for you, you can get both the data and the saved time. Want to know how much your average salaries have increased by over the past year and how much they’re likely to eat into resources in the coming year, say? The days of working it out on a calculator, or even a spreadsheet, are long gone if you’ve got insight and analytics tools on your side.
Forecasting the future
Data collection is just the tip of the iceberg when it comes to forecasting the future, though. The rise of artificial intelligence in finance is an exciting one, and it’s one that could well lead to all sorts of insights for businesses in the coming years. Risk assessment is one of them: artificially intelligent machines are capable of analysing much more data about potential suppliers and partners, for example, than humans can. And with artificial intelligence also able to monitor company expenditure in real time and run it through many different algorithm combinations, insight extraction is about to get easier than ever.
The world may be increasingly uncertain, but it’s also increasingly exciting – especially when it comes to technological innovations in the finance sector. From data analysis tools to futuristic artificial intelligence tools, there’s a lot on the cards.