Guest Contributor– November 26, 2019 6:00 AM
Spend Matters welcomes this guest post from Manoj Shroff, Accenture Operations’ managing director, finance and accounting business process services lead.
Thanks to digital transformation technologies like real-time data analytics, robotic process automation (RPA) and artificial intelligence (AI), financial management is no longer about looking back. It’s all about looking forward, with predictive insights that yield positive business outcomes at scale. While our industry has undoubtedly been disrupted, it’s also been dramatically improved.
These changes (and their benefits) are flowing far outside of the finance department too: Executives and department heads — CPOs and CIOs included — no longer have to repeatedly report back to the CFO. Today, with intelligent tools at their fingertips, they can easily access, share and analyze critical organizational financial data.
The foundation of an intelligent finance operating model is rooted in integrating talent with applied intelligence, unique approach to combining AI with data, analytics and automation under a bold strategic vision to transform business — not in silos, but across every function and every process, at scale.
Applied intelligence and tech-savvy talent
Instead of relying on historically slow and complicated centralized accounting and management, modern corporate finance leaders can oversee a unified and streamlined distributed network. Aided by applied intelligence and tech-savvy talent, they can optimize working capital and manage revenue, expenses and cash flow.
Take invoice management: An AI-based engine simplifies this process, rendering every step more accurate and efficient. Algorithms that get smarter the more they are used can automatically sort invoices based on past payment patterns and history.
In fact, thanks to this predictive technology, finance leaders are able to know with almost 95% accuracy when a particular invoice will get paid — right down to the date. This enables Finance and Accounting (F&A) professionals to be more proactive about invoicing within the context of the revenue cycle and beyond — a real game-changer. They can collect invoices faster and even identify payment disputes earlier. That lets them quickly focus on resolving issues and making sure invoices get paid, saving time and money (not to mention frustration). It’s akin to having a hyper-intelligent virtual assistant who helps you do your job faster and more nimbly.
The journal entry process and reconciliation is another area where the use of AI greatly improves practices, helping F&A pros further make the switch from reactive to proactive. AI technology uses internet data, natural language processing (NLP), and inductive and deductive reasoning to analyze and classify each journal entry, even if some accounting codes and other core details are incomplete or missing.
AI-fueled automated processes tell you right away if you make errors. They also help identify fraud and improve accuracy in recording transactions from 75% to more than 98%. AI sees important patterns that are not always visible to the human eye. It’s a major boon to busy finance teams, freeing up their time so they can focus on broader strategy and growth.
These exciting leaps forward in invoicing, journal entry reconciliation and other essential F&A functions deliver sustainable growth and drive shareholder value. Based on Accenture’s experience with clients, deploying AI- and RPA-driven intelligent insight finance tools can:
- achieve better balance sheet integrity with less than 5% of issues being older than 60 days
- gain 85% to 95% accuracy in capital availability forecasts
- reduce operational costs 40% to 50%
- increase cash collection 20% to 30%
A great example of the impact of real-time reporting is in the consumer goods or retail industry. C-suite executives can see immediately how a specific product or campaign is performing, without waiting weeks for data and insights to inform next steps.
Connected sensors are more commonly attached to products, production machinery and delivery vehicles, creating an an interconnected, always-on web of rich data points. F&A leaders can use this unprecedented level of detail to make better decisions.
Using the latest in predictive analytics, corporate finance executives and managers can better forecast sales accuracy, all while reducing operating costs — even amid increased work volumes. Finance professionals can also plan precisely to overcome obstacles in every market.
How can you champion digital transformation in your organization and go from transactional to strategic? Start by gathering as much information as you can on today’s intelligent finance tools and the partners behind them leading the charge.
When you’re ready to take action, rally for resources for a digital era direct-to-consumer model that shows promise. Encourage department heads to share key tech tools and data across organizational silos and lead the effort to move your company’s platforms to the cloud wherever possible. Embracing enterprise-wide digital transformation will put you in a position to seize opportunity and drive value, efficiencies and growth.
Digital isn’t just changing the way we live, work and play. It’s reshaping whole industries, and, fortunately, F&A is no exception.
**Sources for stats mentioned above: