From computation to comprehension – why offloading decisions to AI gives Finance and Accounting more time to think

Do you think that, back in the 1400s, critics derided the thought of mass knowledge dissemination as Gutenberg brought about the printing press?

I’m sure some did. Socrates didn’t trust the written word 1,500 years earlier, and there were writings on how radios would “divide attention.” Humans are a naturally change-fearing bunch. But, we now take these and other advancements for granted because we traded those fears for the massive value the technology delivered.

Artificial intelligence (AI) is at that point today. There are AI-related concepts, applications, and unknowns we must discuss and solve. But what we’re seeing today is just the beginning. For CFOs, the benefits of time, accuracy, speed, productivity, and more will be revolutionary.

AI is becoming a trusted tool for Finance and Accounting

I joked above about the fear of change not being a new thing. The Office of the CFO overcame similar worries 50 years ago when spreadsheets threatened to put accountants out of work. But, those unfounded fears turned to joy as spreadsheets took on computational monotony, increased speed and accuracy, and gave the entire profession more time to do more rewarding work. AI is doing this and more.

IDC says global spending on AI will double within the next four years, growing at nearly 30% annually. We all read the hype daily, so that’s not a shock. According to Gartner, driving that increase on the business side are exuberant CFOs who see the clear ROI of AI investments, so much so that 71% expected to increase AI spending in 2024. 

Progressive CFOs also spend some of that money on AI for their teams. That’s excellent news, especially for traditionally conservative finance and accounting professionals. And it’s a testament to technologists’ hard work overcoming fears related to bias, hallucinations, lack of explainability, and data privacy and security. 

In the Office of the CFO, AI already helps with number crunching by spotting errors, developing more and better financial models, increasing forecast accuracy, creating automation opportunities, and more.

Now, generative AI is adding comprehension.

Generative AI’s comprehension frees up time for cognitive work

Computers are great at crunching numbers. Until recently, that’s what we’ve used them for; they’ve gotten faster and can handle more complex data at greater volumes. Humans can’t compete at those levels. Those things all help finance and accounting professionals gain more insights to make better decisions.

Also, until recently, humans have been required for post-number-crunching comprehension. The software didn’t know if a number in a spreadsheet was relevant to a new idea the marketing team hatched, or couldn’t determine if a particular budget trend was meaningful to company growth in a specific region. Humans were required to comprehend and understand the data.

Generative AI is here to do just that.

How CFOs are using AI for more than just crunching the numbers

CFOs and their teams are already using AI to understand the data and make decisions based on it, such as categorizing and routing incoming invoices and highlighting data anomalies that might signal errors or opportunities. 

AI is also helping the Office of the CFO develop more accurate predictions, models, and forecasts. AI can take huge volumes of data, understand minor but meaningful trends hidden within, and adjust projections accordingly — all things humans can’t do at the same scale. Those minor AI-driven improvements to forecasts can add up to material outcomes such as profits, investments, budgets, and more.

Aurorium, a producer of specialty ingredients, uses AI on its financial data to predict order volumes and make better production planning decisions. “[AI] shows us which customers are due to place orders soon,” says Robert Franz, Senior Reporting & Systems Analyst at Aurorium. “That lets us run a bigger batch, which is more cost-effective.”

Generative AI can add even more comprehension to understand the numbers and make sense of them in human-readable ways. It can provide explainability with a summary of why a specific number was forecast. It can analyze specific organizational data and write a draft report in any language, explaining variances over past periods and offering potential choices to move forward. It can also answer plain-language questions with plain-language answers so you don’t need to be a SQL or pivot table expert to see, for example, the top five budget line items for office supplies, split by region and ordered by percentage of total regional budget.

This AI comprehension gives humans more time to learn, think, process, and consider more information to make better decisions.

More time to think about what matters most

It’s common for a CFO to tell me their financial performance management solution saves them hours per day, days per month, and weeks per quarter. But, I’ve never heard one say they used that time savings to work less. Sure, they don’t work late as often, but none are working four-day weeks. Instead, they’re focusing less on tactical work and more on strategic, needle-moving decisions that will guide the organization’s long-term success.

Technology has given CFOs and their teams the time to find more growth opportunities, collaborate on more options, and consider the insights more thoughtfully. AI gives them even more time to think more clearly about strategic opportunities, and then be more confident and decisive with decisions and move with more agility.

AI also enables finance and accounting professionals to be more creative because it understands and converts natural language instructions into complex code or query languages. Generative AI helps those who might be great at math but weak at writing or who need an intuitive way to visually present a complex financial projection to a group of non-financial colleagues.

It’s time for CFOs to get comfortable with AI

The refrain of AI taking over everything is about as common as this – if you’re not already using AI, you’re already behind. A McKinsey survey found that 72% of organizations have adopted AI in at least one department and 65% use generative AI regularly. If you’re not using AI and generative AI, assume your top three competitors are.

More than likely, you have some AI talent in your organization now. Seek them out. Get their advice. And get started. 

A good tip is to initially deploy AI on smaller tasks. Error identification is a low-risk opportunity. AI needs access to your financial data, but data isn’t shared and outcomes aren’t created. You already use financial solutions, and many have AI capabilities. It’s also a great way to find and fix error sources across the business.

Deploying AI in smaller phases also helps teams get comfortable working with AI. That will ease your journey as AI and generative AI provide even greater opportunities to do more for your organization. The AI hype isn’t dying down anytime soon, so the faster you understand how it helps, the faster you can adopt tomorrow’s new and innovative AI-powered solutions.

Here’s another tip: Start thinking about what you’ll do with this newfound free time. Evaluate more growth opportunities? More brainstorming and collaboration with the business? Or maybe taking the occasional Friday off? 

I won’t tell.