How AI can improve the finance department’s workflow
Everything you need to know about the power of AI to help your finance department.
Digital finance teams know that the best way to increase efficiency and produce high-quality information is with AI-powered systems. Chen Amit, co-founder and CEO of Tipalti, shares the top four benefits of incorporating fintech and automation into the finance function.
Artificial intelligence has crept into almost every industry and aspect of our lives. It’s become so ubiquitous that most of us don’t even realize we’re relying on it when we talk to a smart speaker or receive personalized Spotify song recommendations.
However, AI is not only beneficial to consumers. It is also beneficial for businesses, especially when it comes to elevating and optimizing the workflows and results of finance departments.
By adopting automation technology, finance professionals get operational boosts. At the same time, they have the opportunity to be more flexible and responsive to time-sensitive market changes.
Today, the social distancing railings that were put up during the pandemic may have mostly come down. However, the use of automation in fintech has not slowed, with experts predicting that AI in the global fintech market will now $22.87 billion by 2026, a compound annual growth rate of 32.5%.
See more: FinTech Disruption: The Evolution of Alternative Lending
Automation’s major impact on digital financial operations
Anyone who has worked in finance knows that it has been ripe for disruption for some time. Many of the traditional financial workflows are full of inefficiencies.
Take accounts payable, for example. The manual AP process is arguably one of the most draining workflows in finance today, causing chaotic and stressful expectations for finance teams. Not only do classic AP responsibilities include many tedious data entry tasks and workflows, but they also open the door to human error.
Automation supported by AI streamlines AP processes. That’s why high-speed companies are going all out to implement AI into their processes and workflows as the world becomes more digital. AP is just one of many finance department functions that benefit from automation. Others, such as issuing reports or managing cash flow, can be just as positively affected.
Four benefits of incorporating automation into finance department workflows
If your finance team hasn’t dabbled in fintech and automation yet, you should start soon. When you do, you and your business will begin to experience some of the benefits listed below:
1. Eliminate time-consuming manual tasks
The adage “time is money” is as true now as it has ever been—perhaps even more so in an age where overwork and burnout are very real, resulting in problems and contributing factors to people leaving their jobs.
One way to deal with employee burnout is to incorporate AI-supported automation software, which can alleviate some of the manual responsibilities. Automation in the financial industry can improve team efficiency and productivity without having to increase team size. At the same time, the automation means that the employees are less burdened by redundant tasks.
Arguably, streamlining repetitive tasks using AI-enhanced automation software has been a trend in many finance departments, growing in popularity since 2020. McKinsey & Company reports that 88% of finance managers has accelerated the use of automated systems and AI. A report from PwC estimates that companies can save as much as 40% of workers’ time when automating financial operations. In that case, the 40-hour employees can return up to 16 hours per week without losing momentum.
2. Raise your financial staff to the level of financial strategists
Training and on-the-job training are becoming increasingly important for employees. Many workers want opportunities to learn and grow professionally from their current positions. Many employees will realize that automation gives them a chance to tap into hidden talents and reach their true professional potential. Try the following strategies as you move toward a different way of thinking about your team members and what they can accomplish. They will help guide your employees to do their best work.
- Share the CFO’s goals: Workers cannot begin to think strategically like the CFO if they are not familiar with the CFO’s broad and narrow goals. A high level of transparency and communication goes a long way to ensure that everyone understands how their contribution moves the department and the company toward a greater purpose.
- Give employees exciting new challenges: Part of the learning process is flexing muscles that have never been used before. Assign more complex tasks to workers at regular intervals.
- Consider a mentoring program: Mentoring can be very beneficial for upskilling and even renewing employees in the finance department. Be sure to listen and learn from your mentees as you coach them – after all, mentoring is a two-way street.
3. Get more out of your fintech stack
It is not unusual for finance departments to work within legacy systems that may or may not be able to integrate with each other. Without integration, employees have no alternative but to continue their repetitive manual responsibilities across multiple systems and backends.
Investing in an upgraded financial technology stack that seamlessly brings together data and workflows frees your department from the constraints of outdated technology.
You may also find that your new technology stack can integrate and help streamline other processes used by other departments, such as procurement, sales, marketing or support, as it can drive competitive intelligence, forecasting, cash flow management and more. Being able to share data across silos improves interdepartmental communication and decision making.
By letting go of outdated manual processes and embracing AI-powered automation, your department can also have important implications for security, compliance and scalability.
See more: Should Fintech Workers Fear AI?
4. Work to reduce risk and fraud in finance
If you work in finance, you are most likely aware of how many false positives manual processes can cause. Your fintech upgrade can help reduce risk and fraud with a significantly lower false-positive rate and increase regulatory compliance with the Office of Foreign Assets Control and Anti-Money Laundering.
AI-powered automation flags bad data to reduce false positives. This eliminates extra work because the systems can analyze the data quickly, giving employees time back to focus on higher value tasks that cannot be automated.
The whole point of AI is that it keeps learning as it analyzes data and situations. Ask your fintech provider how you can maximize your system’s ability to lower false-positive rates and improve regulatory compliance.
Finance, automation with artificial intelligence and the future
There is little doubt that automation will continue to change the face of all types of businesses and business operations. If your finance department doesn’t seem to be running as smoothly as you think it could, you may find an answer in AI-powered fintech. With automation by your side, your team will be able to accomplish more without adding employees or making anyone work overtime.
Do you think AI-supported fintech will make finance safer and more agile? Share with us on Facebook, Twitterand LinkedIn. We’d love to know!
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