Artificial intelligence (AI), machine learning (ML) and other advanced technologies were the hot topics at AFP 2018 in Chicago. Dozens of sessions were devoted to how these technologies are being used to better manage liquidity, control risk, cut costs and support new business initiatives.
While some experts offered primers on how these technologies work, laying out their opportunities and challenges, others shared real-world insights into how their organizations rolled out these solutions, and the impact they have had.
All About the Data
Experts explored applications for AI and ML in treasury tasks and how they can be leveraged today to gain insights while reducing risks and cutting costs. According to Elmer Dispo, treasury manager of Google, Google is currently partnering with SAP to develop a cash intelligence tool that can forecast better error rates in processing than its human analysts. It’s one of many projects the company is pursuing to use AI and ML to improve financial processes.
Experts noted that treasury can only benefit from these tools if companies invest in solving their inconsistencies in their data, which was cited by roughly 40 percent of session attendees as the biggest challenge they face in using AI and ML. Panelists encouraged session participants to begin their own AI/ML journey by translating and standardizing their data sets, then applying simple analytics to identify trends in payment behavior as a way to prove the value of these technology investments.
RPA in Action
The treasury team at Mallinckrodt Pharmaceuticals has already witnessed success with its implementation of robotic process automation (RPA). Mallinckrodt’s treasury manager Kristin Scott and assistant treasurer Ravi Iyers shared the details of their pilot RPA roll-out in an AFP 2018 session, and lessons they learned along the way.
It’s a very powerful tool for treasury because it promotes transparency and auditability to generate a greater level of confidence,.
–Roberto Cruz, treasury director, SUEZ
They touted the benefits of partnering with an RPA consultant early in the process to identify the right tasks to automate, choose a vendor, map workflows and deal with implementation challenges. For Scott’s team, those challenges including securing credentials for the bot to access various platforms, establishing back-up processes if the bot is compromised and figuring out how to address security systems that prevent bots from accessing data.
In this first RPA project they automated the process of capturing daily cash position data, running calculations and delivering the daily report. “It reduced the time to complete this process from 60 minutes down to three,” Iyers reported. He said it was likely the first of many RPA implementations his team will deploy in the years to come.
What Is Blockchain?
Blockchain was another hot topic at AFP 2018, with several sessions dedicated to educating attendees on what this technology is and how it is being used across the finance industry.
Sean Stein Smith, professor at City University of New York (CUNY), and Roberto Cruz, treasury director of water company SUEZ, attempted to clear up confusion about what blockchain is (note: it’s not the same as bitcoin), and why finance industry professionals should care.
Smith explained that blockchain is a peer-to-peer virtual network of ledgers that permanently store blocks of data about transactions, which can be viewed by anyone with access to the network. Every time new data is entered into the chain it is hosted in its own block, and if anyone tries to alter any data everyone can see it.
The “immutability and decentralized ownership enabled by blockchain” promises to reduce the risk of fraud while accelerating the exchange of data in financial transactions, Cruz said.
While most of the pilot projects currently using blockchain are still novel, Cruz expects to see blockchain gaining prominence in finance applications in the next five years.
While most of the pilot projects currently using blockchain are still novel, Cruz expects to see blockchain gaining prominence in finance applications in the next five years. “It’s a very powerful tool for treasury because it promotes transparency and auditability to generate a greater level of confidence,” he said.
Experts at the AFP 2018 sessions underscored the technology evolution that is occurring across treasury functions today, and inspired many attendees to think about how they can leverage these tools to gain efficiencies in the future.
Photo: Getty Images