There is a plethora of new Artificial intelligence (AI) tools available that can help the finance function automate tasks and improve the way the business interacts with a wide range of stakeholders.
According to the Merriam-Webster dictionary, AI is defined as, “a branch of computer science dealing with the simulation of intelligent behaviour in computers" and, “the capability of a machine to imitate intelligent human behaviour."
Many finance functions have the potential to be improved by AI, including accounts payable and receivable, invoicing, and contract preparation. AI is also being used in predictive financial models and to improve business planning such as sales, inventory and working capital requirements. It is potentially more powerful than non-AI technology because it can consider more variable factors and leverage greater computation processing power at a lower cost.
Some of the other useful AI-powered technology innovations include the ability to authenticate customers' transactions with the sound of their voice, and voice-activated passwords and pin numbers. Voice biometrics could also potentially assist detect and identify a fraudster in real-time, a particularly important feature in the context of instant payments.
Last year ANZ rolled out voice biometrics technology on its mobile banking app to help customers perform transactions conveniently and securely. Customers can now make 'pay anyone' payments of more than $1000 on their mobile without needing to log into internet banking, remember additional passwords or PINs, or visit a branch.
The technology is powered by tech firm Nuance. The voice-activated technology has two components. First, it can verify the user's voice or password and second, and more impressively, It can understand the person's intent - for instance, to transfer $1,000 from one account to another.
“Conversational commerce will become far more prevalent in the future," says Robert Schwarz, Managing Director of Nuance.
Schwartz says that because of artificial intelligence, automated chat bots will increasingly be able to direct customer queries to the right channel, helping to improve customer satisfaction, and direct the customer to the correct area to service the inquiry.
He notes people are becoming more comfortable using tools such as Google Home and Amazon Alexa and believes they will be willing to adopt similar technologies in the workplace.
“What's going to be important for businesses is the skills that you can build under those devices and the commercial applications they can handle. It's also important to remember voice actions are likely to be performed from your smart phone, device or car – whatever suits you as a consumer."
Voice-recognition technologies could possibly be widely adopted by mid-market businesses to authenticate individuals. “This will make a big difference in terms of how they can combat fraud, increase operational efficiencies and communicate with customers," Schwartz says.
AI technology will reach a point in the future at which it will become difficult to tell the difference between a chat bot and human. However, the nature of AI is that there is a level of self-learning in these technologies that needs to happen before they are consumer-ready. Many businesses undertake pilot projects and encourage staff to use the technology to help it learn.
“You need a level of human curation to make sure the way the technology learns is correct," Schwartz says. He points to Microsoft's disastrous launch of its Tay chat bot technology as an example of what can go wrong. When the chat bot was launched in 2016 it was quickly hijacked by trolls, who taught Tay to absorb ugly views and outlooks. “There is a way to build chat bots that set guidelines and boundaries of what's wrong and right, but human interaction is still essential," he adds.
Preparing the finance function
For finance functions wanting to embrace new technologies, one effective first step involves exploring the technologies that are currently available.
“The good thing about these technologies is they are quite easy to implement, and you can do it in small steps. You don't have to take a big bang, 'build it and they will come' approach. You can work in a very agile way, which is how many firms are working. The idea is to try out new technologies and see how they play out for customers. Learn from each part of the process and tweak what you're doing accordingly," Schwartz says.
He suggests CFOs could build a roadmap over one or two years to plot where they are today and where they are going on their AI journey.
We are only at the first generation of AI for the finance function - but AI tools could disrupt future audit, management accounting and many other standard finance tasks.
CFOs could prepare by keeping an open mind to the potential this technology might offer and work with their teams to take an experimental approach.
Wide reading, attending conferences, undertaking training courses and inviting vendors to present to the team could help with understanding the benefits of AI technologies.
It will also be important to bring the team along on this journey to ensure they don't feel threatened and to make sure they take full use of the powerful new tools at their disposal.
By focussing on building the right culture, CFOs can help team members feel comfortable about both adopting innovations and implementing processes to ensure new technologies are properly embedded.
Finance functions that master acceptance and understanding of these new technologies have the potential to harness everything AI offers, to improve the way staff work – thus benefiting the team and the business as a whole.
- Voice-activated technologies could increasingly be used to verify individuals.
- It could become progressively more difficult to tell the difference between a human and a robot answering a customer query.
- Building the right culture can help ensure staff feel comfortable using and not threatened by new technologies.