“Artificial intelligence and machine learning are radically transforming how business operates, especially finance. Routine tasks are being automated so that finance professionals can focus on what matters most–identifying the next growth markets.”

Safra Catz

Chief Executive Officer, Oracle

AI will empower finance professionals to focus on what is really important: discovering the next growth markets. That is how Safra Catz, CEO, Oracle views the use of AI in commercial finance operations. 75 CFOs at large organizations shared in a[ May 2023 survey ](https://www.mckinsey.com/capabilities/operations/our-insights/generative-ai-in-finance-finding-the-way-to-faster-deeper insights#/)that one in every four of them (22%) were actively investigating uses for GenAI within finance, while another 4%
were pursuing pilots of the technology.
The reason? Finance is growing increasingly complex, with vast volumes of data to examine. CFOs need new methods to make better decisions, improve processes, and grow their businesses.
AI, like the internet in the 1990s, is evolving at breakneck speed. Its ability to automate complex tasks will fundamentally reshape how finance functions. AI is no more an option; it is a necessity.

Why Does Finance Need AI?

Traditionally, finance processes have been dependent on manual effort.

The significant workload in Finance, which includes data entry, collection, verification, consolidation, and reporting, leaves the discipline expensive, time-intensive, and resistant to change. However, the finance role is consistent and well-defined, making it a good fit for digitization.

In the 1990s, Enterprise Resource Planning (ERP) systems transformed finance by simplifying operations, eliminating the need for human labor, and boosting accuracy. While ERP brought significant gains, AI promises an even greater revolution. Unlike rule-based automation, AI can fully automate time-consuming, manual operations and handle more complicated scenarios. It can enhance the ERP experience by making it easier to retrieve and analyze data using natural language, simplifying system configuration, extracting relevant information from vast data, and providing actionable insights in real time.

Competing responsibilities, including cost management, technological advancements, and evolving service delivery models, add to the challenges for CFOs. To streamline and accelerate the finance function, they must invest in disruptive efforts such as artificial intelligence and autonomous digital projects that reimagine the overall financial process.

Current AI Focus: Optimization and Efficiency

Finance teams today are actively harnessing AI for a wide spectrum of tasks.While automating tedious tasks like invoice processing and expense management, AI simultaneously unlocks real-time insights by analyzing vast amounts of data, empowering strategic forecasting and decision-making.

Additionally, AI-powered tools are enhancing fraud detection, risk management, and compliance, bolstering the organization's financial security. And now, Generative AI (GenAI), promises to take these advancements even further, transforming finance functions in unprecedented ways. The excitement surrounding GenAI is apparent. [According to the Q1 2024 Deloitte CFO Signals (https://www.restack.io/docs/strapi-knowledge-strapi-markdown-table-guide) poll, finance professionals expect the highest adoption rates for GenAI in IT, operations, customer service, finance, and sales/marketing. The strong adoption rates demonstrate CFOs' awareness of the need of efficiently harnessing GenAI inside finance processes. 60% believe that developing these competencies internally is critical in the coming two years. The emphasis on talent is consistent with the anticipated enhancements in productivity; 70% of chief financial officers (CFOs) foresee a 1%-10% rise in efficiency as a result of deploying GenAI, specifically in strategic domains such as forecasting, scenario planning, and personalized financial analysis.

How AI Drives Operational Efficiency in Finance?

AI: The CFO’s New Weapon

Although contemporary AI provides exceptional advantages, the emergence of generative AI ushers in an entirely new era. Traditional AI has focused on optimizing existing workflows, serving as a powerful tool for driving efficiency in task execution. Going further, AI is poised to become a collaborative partner and proactive problem- solver alongside finance professionals. Here's where the true transformation lies:

Transform Decision Making
The potential of generative AI to evaluate complicated datasets and produce nuanced forecasts will enable CFOs to move beyond static reports. AI can simulate how different market conditions, changes in regulations, or strategic choices will affect a company’s finances. This facilitates flexible, data-driven planning.

Streamline Analysis
Generative AI will enhance traditional AI tools. For example, in auditing, while traditional AI can flag discrepancies, generative AI could analyze regulations, draft initial report sections summarizing findings, and even suggest potential follow-up questions for
auditors based on past trends. This simplifies the procedure and frees up auditors to conduct in-depth analysis.

Transform Forecast
As generative AI capabilities grow, it will transform entire core finance procedures. This includes writing detailed financial narratives to go with reports, giving business partners useful information, and finding possible risks ahead of time and coming up with ways to mitigate them. AI will be a critical component of strategic collaboration and innovation.

Customize Financial Output
Generative AI can make suggestions and summaries that are specific to the company, the business, and even the way that finance professionals like to talk to each other. This enhances collaboration, making AI feel like a true extension of the finance team.

Democratize Data
Generative AI helps non-finance workers across the firm by transforming complex financial data into understandable summaries and visuals. This promotes a more data- informed culture, leading to better decision-making and a broader understanding of the financial drivers behind business success.

Discover Hidden Solutions
Generative AI has the capacity to uncover hidden opportunities or propose novel solutions that traditional analysis may overlook. For instance, it can spot hidden cost- cutting patterns, find potential joint ventures based on market research, and suggest new revenue streams. Collaboration between AI and humans in the ideation process will promote expansion.

AI Began Years Ago: Are you behind?

As far back as 2021, a research report titled “Money and Machines” (Savanta and Oracle) underscored the critical role of AI in finance. 85% of business executives acknowledged the dangers of inaction and expressed a desire to implement AI. Failure to rethink finance processes using AI could lead to:

Falling behind competitors (44%)
Stressed employees (36%).
Inaccurate reporting (36%)
Reduced staff productivity (35%)

The ramifications go beyond operational inefficiencies. Employers that are slow to adopt AI risk losing their appeal to top talent. 83% of millennials and 79% of Generation Z employees said they would trust AI over their company's finance team. Millennials are nearly four times more likely than Baby Boomers to want to work for AI-driven enterprises.

These findings underline a stark reality: the need for AI-powered financial revolution was clear years ago. Organizations who have not adopted this transition are already at a disadvantage. The time for hesitation is over – decisive action is needed to remain competitive, attract top talent, and ensure the future success of financial enterprises.

Give your Finance team the AI edge

The transformative power of AI in finance is undeniable. Investing in AI solutions will empower your organization to make data-driven decisions, streamline operations, and thrive in a dynamic business landscape. To stay competitive, explore solutions that can enhance your capabilities. Platforms like ActyvVerse.AI help enterprises build specialized language models. These models draw knowledge directly from your company’s data. Once trained, they integrate with your finance systems. This leads to better insights, automated processes, and smarter decision-making.

Here’s how to begin your AI journey:
● Prioritize: Identify areas where AI can have the greatest impact on your specific challenges.
● Pilot: Start with a focused project to demonstrate the value of AI before scaling.
● Collaborate: Bridge the gap between finance and IT for successful implementation.
● Upskill: Invest in training your finance team to maximize their AI partnership.

Discover how ActyvVerse.AI could potentially empower your finance operations and help you achieve even greater success.