Just as mobile technology and data science made fundamental changes in business, machine learning and artificial intelligence will redefine how daily work is done. Expanding automation will allow businesses to be more efficient, creative and – ultimately – effective.
AI is the application of human-like intelligence to machines, enabling it to mimic human actions. Machine learning goes further, allowing computer systems to improve themselves through experience. This often manifests itself through automation, where systems are able to perform tasks without being prompted by a human user.
AI is often seen as chatbots, cybersecurity solutions or autonomous supply chains, while machine learning can be seen in virtual personal assistants (think Siri or Alexa), social media algorithms or your inbox’s spam folder.
Machine learning and AI’s role in accounting automation
The digital transformation will impact multiple aspects of most industries, finance and accounting chief among them. AI and machine learning will have long-lasting impacts and significantly alter the way work is done.
For accountants and other finance professionals, this means many routine tasks will be done automatically. Software will handle all invoice payments, from billing to closing accounts – while never sleeping. Accounts receivable departments will no longer have to handle repetitive tasks, freeing employees to push the business forward.
An automated invoice processing system augmented with AI or machine learning may:
- Enhance optical character recognition (OCR) for invoices
- Create invoices
- Turn documents into validated data
- Verify invoices
- Actively monitor for billing errors
- Flag questionable accounts for human investigation
The business advantages of automation
The positive business impact of automation will be significant. The amount of time required to simply run the business will be greatly reduced. Instead of performing tasks just to keep day-to-day operations moving, employees will be free to find new ways of making day-to-day operations better.
Whether investing in AI and machine learning makes sense for a business depends on a variety of factors. Decision makers should follow two general formulas when making a determination:
Hourly Rate x Labor Hours = Labor Costs
Labor Costs – Automation Cost Savings = Total Cost Savings
This is of course, just a starting point. Specialty areas, like automated accounting, have other factors to consider. Most importantly is the elimination of errors. Accounting errors have a cascading effect on a balance sheet. A machine will never forget to carry the one.
They’ll continue to get better, as well. Machine learning algorithms will improve over time and lead to more automation opportunities.
How the job of the accountant is changing
Accountants have historically had a large of amount of minutiae to wade through. From bookkeeping to navigating thousands of customer accounts, far too much time has been spent on the mundane aspects of the job and not enough on building the business.
Automation frees them to be more strategic. There will be less financial accounting and more financial analysis. They will spend less time being concerned with ensuring that numbers are right and more time considering what can be done with those numbers.
Accountants will be more proactive and better understand what is driving the business financially, understanding trends and making recommendations on how to maximize value.
Is your business ready for AI and machine learning?
The future is here and it is automation. Companies that embrace it today will be better prepared tomorrow. Software solutions built with automation in the foundation are an easy way of joining the digital transformation. It’s a win for companies, employees and customers.