With technology providing finance professionals the opportunity to push the boundaries of efficiency and effectiveness, automation is drastically reshaping the way that finance functions operate.
Although the very nature of finance-related work allows finance to lend itself seamlessly to automation, other industries and functions can learn a lot from the sector — if they pay attention.
Why Automation?
What seems like a simple question still remains a mystery to many. That’s why understanding the capabilities offered by the full range of automation solutions — including robotic process automation (RPA), artificial intelligence (AI), machine learning (ML), and analytics — can help businesses develop new strategic opportunities. For a growing number of organisations, automation now plays a key role in driving business objectives around process efficiency and effectiveness.
Over the past five years, all industries and sectors have experienced a significant push towards automation and digitisation.
Recent surveys have also shown that due to the current climate, 77% of senior executives are re-evaluating their automation agenda and the speed of adoption.
Why is automation so pertinent for finance functions?
Businesses have long channelled finance functions to provide more business value, but more often than not, routine-based transaction processing consumes a significant amount of time and limits the amount of capacity needed to perform higher value-added tasks.
Because automation is highly effective at targeting processes that are highly transnational, mundane, and repetitive, implementing an automation program can instantly address this issue through the elimination of transactional processes, allowing finance personnel to focus exclusively on value-added tasks.
Many traditional finance functions are ripe for end-to-end automation, which can deliver a substantial amount of process efficiency, as well as partial automation that augments a human workforce with robotic or virtual finance staff members.
Invoice processing, for example, can be automated end-to-end using a combination of OCR (optical character recognition) and RPA to process the invoice, extract data, and post the information into ledgers. Tasks related to financial analysis, such as report generation and creation, can be partially automated and automatically handed over to a financial professional to perform their specific, value-added insights using the reports.
Automation is here to stay
For most successfully scaled automation programs, finance tends to be one of the first functions targeted for automation. There are three major reasons why most organisations have found automation to be suitable for carrying out finance functions:
Excellent return on investment
Not only are there significant financial benefits associated with automation, but the ability to reduce errors, improve compliance, and free up resources to focus on higher value-added tasks can greatly boost the effectiveness of any organisation. Automating transactional processes can also allow more work to be pushed to finance shared service centres, further driving optimisations in processes and operating models.
Processes
Due to the nature of financial processes, there are many automation opportunities across the purchase-to-pay, record-to-report, and order-to-cash functions. A prioritised backlog of automation opportunities can be crafted to build a substantial benefits case.
Multiple use cases can be leveraged to identify new opportunities for automation. The seasonality of month-end, quarter-end, and year-end processes, for instance, can each serve as a strong automation use case. Considering automation solutions can be successfully deployed across a wide range of finance functions, the similarity of finance functions throughout different industries can provide a wide range of learning opportunities.
Finance processes also allow intelligent automation to become a fast follower from RPA. Because RPA can be used for standard transactional processes, OCR can also be leveraged for document ingestion, while virtual agents or chatbots can carry out automated helpdesk functions.
Finance personnel
Because many people working in the finance function typically have a mindset geared towards continuous improvement, implementing and adopting automation makes for a natural fit. Historically, VBA macros have been developed in-house within the functions to drive process automation. A work culture that leans into implementing solutions that improve efficiency can help drive the successful adoption of tools like RPA.
Finance personnel have taken up roles within the automation centre of excellence (CoE) due to their particular skill sets, which has often worked well when building out capabilities and offering related services through the business. It’s no wonder that so many automation CoEs originated in finance before spreading enterprise-wide. Banks, insurance companies, and utilities are among today’s industry leaders that are fully embracing the benefits of automation.
For businesses looking for advice on where to begin their automation journey, the finance function stands out as a clear and effective starting point.
As a natural fit that takes advantage of the task-oriented, repetitive nature of finance functions, embarking on an automation journey within the finance function can increase the overall return on investment and provide a useful learning curve for future automation implementations within a company.
