The way we do business is changing, and artificial intelligence and machine learning (AI and ML) technologies are inseparable from that change. These shifts are readily apparent in the finance department, where CFOs are eyeing AI and ML to transform finance and procurement practices by reducing the hours finance teams spend in onerous, repetitive processes and giving them the tools and time they need to focus on delivering strategic value to their business.
Forward-thinking finance leaders can see the opportunities. Workday’s C-Suite Global AI Indicator Report found that 40% of CFOs believe AI and ML will enable finance and procurement teams to deliver more business value. In addition, 46% of finance leaders say they’re eager to use AI and ML in their function – a higher percentage than for IT leaders (45%) or leaders in HR (39%) – and 39% of finance leaders agree that AI and ML are a game changer.
What’s more, there’s evidence that businesses are already seeing tangible benefits from adopting these technologies. Workday’s 2023 AI IQ report on AI in the enterprise found that businesses were already using AI and ML for improved forecasting, scenario planning, risk detection, and automation of non-strategic tasks. More than six in 10 were seeing improvements in risk, fraud, and compliance (68%), customer experience (67%), employee experience (65%), and company revenue (63%).
The Workday AI Indicator survey confirms that organisations with the highest level of AI maturity, investing an average 30% of their annual budget into AI technologies are also the organisations making the most progress in streamlining or automating workflows, while augmenting the capacity of their workforce. As these ‘AI Pioneers’ surge ahead, those slow to adopt these new technologies risk falling behind.
Reconciling figures and priorities
Why is AI growing in importance? Firstly, it has the potential to eliminate much of the drudgery and inefficiency involved in finance and procurement, streamlining operations that normally take months or weeks so they can be completed in much shorter timeframes.
As Workday Co-President Sayan Chakraborty, puts it, today’s CFOs are juggling competing priorities. ‘We’ve always viewed the CFO through the lens of “you’ve got to close the books, you’ve got to make sure there’s enough money to pay the bills. You’ve got to meet all the company regulations”.’ Yet, he also notes that ‘the CFO is now expected to be a trusted advisor at the business level for where the company needs to go.’
By adopting AI, Chakraborty notes, CFOs and finance teams can spend less time driving through these operational tasks and more time tackling strategic, line of business priorities.
Crucially, using AI doesn’t simply mean completing these tasks faster, but also completing them with greater accuracy. ML systems can pick through expense reports to pinpoint items that require review before reimbursement, or help fill in missing information needed to process an invoice or a customer payment. They can pick up mistakes in accounting entries so that they can be corrected in real time.
As Chakraborty explains, ‘people are not really good at looking at hundreds of thousands of transactions to find the one that shouldn’t be in there. Computers are, and they don’t get tired, and they don’t run out of time.’ In fact, with ML integrated into highly automated workflows, finance teams don’t have to wait until the end of a quarter to discover issues and anomalies, as the algorithms can identify them while they’re being processed, at a point where it’s easier to investigate, remediate, and reconcile. This also helps organisations deal with regulatory and compliance requirements in a timely manner. AI tools can handle complex regulatory documents with a tireless speed and precision that humans just can’t match.
By automating workflows, enriching them with data, and delivering insights at speed, AI technologies can empower organisations to harness real-time financial data in supporting decision making. For instance, finance teams can apply ML to data from past activities and deliver models and insights that can inform ongoing strategies across the business. The FT Longitude/Workday survey shows that one in three finance and procurement leaders select improved forecasts and budgeting as the most immediate value they expect to derive from AI, while 40% of CFOs believe that AI and ML will bring new opportunities for finance and procurement to collaborate with other teams.
This, as Chakraborty notes, ‘starts to change the conversation from a lot of people’s opinions to a data-grounded conversation.’ Instead of attempting to reconstruct what happened in the past from memories and snatches of data, organisations can view the whole picture, based on data from millions of transactions. AI tools can help organisations determine the factors and variables that count, and isolate them from those that don’t have any real impact. While machines can’t deliver all the answers, they can provide the accurate, detailed analysis executives need to help them make the right choices.
Or, as Brian Montgomery, Senior Director of Finance at Workday, notes, ‘on a day-by-day or even an hour-by hour basis, AI is starting to tell us what is happening now in your business, and seeing what the right thing to do with that new information is.’
‘From a finance team’s perspective’ he continues, ‘it means they can not only determine what’s happened, but also shape the future and help the company achieve its strategic goals in a more efficient and meaningful way.’
Paving the way for AI/ML success
It’s understandable if CFOs have concerns around AI and ML. The FT Longitude/Workday research found that 36% of finance leaders agreed that a lack of transparency in AI tools could weaken security and compliance. And 62% ranked security and privacy concerns as the biggest risk around AI. Many also worry that the data needed for AI and ML operations is siloed inside existing company structures and legacy systems, or not in a fit state for use. Over a third (34%) say that finance and accounting is the area of the business least prepared for greater integration with AI and ML, while 30% feel their employees won’t have the technical skills required.
Organisations can address these concerns by consolidating and unifying their financial, HR, and operational data in a single data source, delivering visibility and operability across the business. With AI embedded into core processes, Workday AI can remove much of the friction and tedious work around everyday operations, while pinpointing any errors or anomalies. And because Workday consolidates all the relevant data within one platform, it’s easier for CFOs and finance teams to make that data work on a strategic level.
There’s no quick fix for skills and talent shortages, but Workday’s embedded approach makes a lack of specialist expertise less of an issue. Using Workday also makes it easier to shift towards a skills-based approach to talent, where employees can be upskilled or reskilled to get the most from AI tools.
Learn how Workday’s finance and HR platform, with AI embedded at the core, can help your organisation redefine how work works.