The CFO and AI: a strategic partnership
Increasing revenue, reducing costs, adjusting forecasts: all common processes and goals for a Chief Financial Officer (CFO). Uncertainty about the economic environment, increasingly strict legal requirements and regulation, obligations to investors who are looking very closely: also common processes and challenges for a CFO. Where does artificial intelligence come in?
In a recent study, the staffing services firm Robert Half found that 81 % of Swiss CFOs expect to experience increasing stress over the next two years. This probably explains - at least in part - why auditor Deloitte is seeing increasingly shorter tenures and higher turnover at CFO level. The variety of tasks and responsibilities is growing, and with it the complexity of the challenges: A CFO has more and more to do and consider. Health, motivation and efficiency can quickly and often be the casualties. This paves the way to burnout. In order to find other, healthier, sustainable and efficient ways, CFOs are increasingly turning to new technologies, especially artificial intelligence (AI), to better use and optimally allocate their working time.
A recent study by Oracle shows that more and more CFOs are relying on AI solutions to help them with their day-to-day operations - a full 43 % of CFOs surveyed are engaged with AI applications. Paperwork and various day-to-day operational burdens can be eliminated or reduced with the help of AI, allowing a CFO to focus on strategic and authoritative decisions. There are studies that predict investment increases of 54 % in such cognitive and AI-based aids globally in the coming year. The goal of such investments will be to save the human - the CFO - from inefficiencies or free him from minor value-added distractions, to reassure him to focus on his strengths and his key strategic contribution to the business. For this to work, necessary processes and information (including data) must be consistently applied and connected. The CFO who does this consistently is equipped to tackle increasingly complex challenges and goals in a healthy, sustainable and efficient manner.
The advantages: artificial intelligence as a friend and helper of the CFO
In finance, the benefits and potential of AI as a friend and helper to humans are undisputed. On the one hand, AI can be used to automate processes in order to free employees from or relieve them of everyday and recurring procedures. Virtual assistants can, for example, help with accounts and balance sheet calculations as well as compliance tasks. Furthermore, AI not only aids in aggregating information and data, but also enables useful and accurate predictions. A CFO must not only answer the question "What happened?" but also the question "What would happen if?" - therein lies the opportunity to make better, long-term and sustainable decisions.
In addition, AI can assist the CFO in, for example, handling cash surpluses in payment discounts and any service provider selection. For example, using AI, an ERP system can act intelligently to identify invoices from service providers offering time-based payment discounts and signal such opportunities to the finance team so that appropriate payment processes can be set up and prioritized.
Use data to optimize decisions
AI-based applications should be connected to the entire company via the cloud, because in isolation - in a data silo - AI can only develop a fraction of its added value and you run the risk of missing out on optimization opportunities. As a general rule, data silos should be avoided and data from internal, open and third-party sources should be connected. From human resource management to marketing and sales, a company sits on a veritable and always unique treasure trove of data. Intelligent applications and algorithms can process, analyze, and visualize this treasure trove of data into information to ultimately derive useful recommendations. AI can help CFOs make trade-offs and decisions and make the CFO more agile and flexible, so they can not only better respond to new developments, but at best even predict them and stay one step ahead. On top of that, AI-driven applications and algorithms get smarter with each new data set and action decision, incorporating information from recent events into future analyses for ongoing optimization. In a sense, AI and CFO are continuously learning and working together to consistently deliver better results smarter, faster, and more efficiently.
By breaking down data silos and leveraging cloud computing and AI applications, CFOs can optimize processes and outcomes to manage their company's finances in a consistent, responsive, and predictive manner. In the long term, AI applications and modeling can provide previously unattainable, accurate information and outlook into the future. In times of increasingly volatile economic conditions, intelligent forecasts and smart advice are worth their weight in gold. When it comes to managing a company's finances sustainably, the innovations and assistance that AI offers should be harnessed.
There is hardly a business location where innovation is more important than in Switzerland. This is one of the reasons why many Swiss companies are on the verge of connecting their ERP systems to the cloud in order to pave the way for holistic, AI-supported applications and assistance: This is a potential that no company can afford to ignore.
