Many commentators believe
we are already in the midst of a fourth industrial revolution, also known as
Industry 4.0.
This new working
environment blurs the lines between the physical and digital worlds, as well as
between people and machines.
There are many converging
technologies involved, including artificial intelligence (AI), 3D printing,
genetic engineering, quantum computing, the Internet of Things (IoT) and
robotics.
One of the key elements is
automation and particularly smart automation. Automation is a general term for
technology applications where human input is minimized.
This could involve
programming an industrial robot to do repetitive mechanical tasks quicker and
more efficiently than a human could do, or using robotic process automation
Smart or intelligent
automation requires decisions to be made based on an understanding of the
underlying data, workflow processes and options available.
This typically needs AI
and machine learning systems underlying the processes.
This could apply to
customer service chatbots, driverless cars or the increasingly prevalent
personal assistants like Siri and Alexa that many of us have in our homes.
Many businesses are also using a combination
of robotic process automation and smart automation technology to streamline and
improve their existing financial processes.
For example, a feature
like automated account payable
software could potentially save a business hundreds of person-hours and many
thousands of dollars simply by automating manual accounts payable processes and
eliminating inefficient workflows.
Where should financial automation be deployed?
This is far from the only
use for automation in financial processes, although it is a good example.
Accounts receivable (AR) and accounts payable (AP) are two interlinked areas
where traditional manual processes are highly inefficient and prone to error.
Any errors can result in
delayed payments to vendors, impacting trust and ongoing business relationships
in the process.
Delayed invoice clearances
for employees can also lead to dissatisfied workers, while miscalculations can
also influence short-term liquidity and cash flow.
Automated AP and AR
software can easily take care of tasks like auto-generating invoices, sending
due date reminders, processing payments, cross-checking invoices
against purchase orders and much more.
Other financial processes
that are perfect for automation include payroll and reconciliation. Paying
employees accurately and in a timely fashion is an essential part of keeping a
happy workforce and keeping your productivity on track.
It can become an unwieldy
task as that workforce grows and any errors can cause dissatisfaction very
quickly.
With the right software in
place, it is easy to replace cumbersome manual practises, checking payroll data
against timekeeping schedules and taking care of any necessary deductions or
other adjustments.
Reconciliations,
meanwhile, involve comparing two sets of records to check that all figures are
correct and in agreement.
This obviously involves a
lot of repetition but is also meticulous work and it is easy to end up with
errors when relying on manual input – potentially requiring the entire process
to be repeated.
This is the ideal
situation for robotic process automation, which can make the comparison quickly
and without the possibility for errors. This also allows you to carry out
reconciliations as often as you like, helping to spot discrepancies that could
indicate fraud or other issues.
The benefits of financial automation
Businesses of all shapes
and sizes are increasingly adopting financial automation in areas such as these
and they are reaping the benefit. The robotic process automation market has
been predicted to reach nearly US$2 billion by
2025 and businesses are embracing the technology for good reason.
Some of the potential
benefits of automating financial processes include:
Automation tools can
massively reduce inefficiency in many workflows and processes throughout your
financial system.
This can free up
person-hours for higher level or more creative tasks, rather than having
employees constantly running through the same repetitive tasks.
This also brings with it a
financial benefit, which can be substantial when the software is used
throughout the organisation. You may find it, in fact, more than pays for
itself very quickly.
People are the biggest
asset of any organization, but human error can be a problem. This is especially
the case in the repetitive, mundane tasks already mentioned.
It can be easy to lose
focus or concentration and any errors made can be costly in terms of time,
efficiency, compliance and even reputation.
Nothing spoils customer or
client relationships faster than unpaid bills, chaotic invoicing, and a lack of
communication. Financial automation can take care of all these things, making
sure that everything leaves when it should and making sure communications are
timely and tailored.
Manual processes may
involve valuable information passing through multiple hands before being signed
off or may hit a bottleneck at some point in the workflow. Automated digital
processes can be accessed more easily, giving management and other stakeholders
access to the information they need when they need it.
Many commentators believe
we are already in the midst of a fourth industrial revolution, also known as
Industry 4.0.
This new working
environment blurs the lines between the physical and digital worlds, as well as
between people and machines.
There are many converging
technologies involved, including artificial intelligence (AI), 3D printing,
genetic engineering, quantum computing, the Internet of Things (IoT) and
robotics.
One of the key elements is
automation and particularly smart automation. Automation is a general term for
technology applications where human input is minimized.
This could involve
programming an industrial robot to do repetitive mechanical tasks quicker and
more efficiently than a human could do, or using robotic process automation
Smart or intelligent
automation requires decisions to be made based on an understanding of the
underlying data, workflow processes and options available.
This typically needs AI
and machine learning systems underlying the processes.
This could apply to
customer service chatbots, driverless cars or the increasingly prevalent
personal assistants like Siri and Alexa that many of us have in our homes.
Many businesses are also using a combination
of robotic process automation and smart automation technology to streamline and
improve their existing financial processes.
For example, a feature
like automated account payable
software could potentially save a business hundreds of person-hours and many
thousands of dollars simply by automating manual accounts payable processes and
eliminating inefficient workflows.
Where should financial automation be deployed?
This is far from the only
use for automation in financial processes, although it is a good example.
Accounts receivable (AR) and accounts payable (AP) are two interlinked areas
where traditional manual processes are highly inefficient and prone to error.
Any errors can result in
delayed payments to vendors, impacting trust and ongoing business relationships
in the process.
Delayed invoice clearances
for employees can also lead to dissatisfied workers, while miscalculations can
also influence short-term liquidity and cash flow.
Automated AP and AR
software can easily take care of tasks like auto-generating invoices, sending
due date reminders, processing payments, cross-checking invoices
against purchase orders and much more.
Other financial processes
that are perfect for automation include payroll and reconciliation. Paying
employees accurately and in a timely fashion is an essential part of keeping a
happy workforce and keeping your productivity on track.
It can become an unwieldy
task as that workforce grows and any errors can cause dissatisfaction very
quickly.
With the right software in
place, it is easy to replace cumbersome manual practises, checking payroll data
against timekeeping schedules and taking care of any necessary deductions or
other adjustments.
Reconciliations,
meanwhile, involve comparing two sets of records to check that all figures are
correct and in agreement.
This obviously involves a
lot of repetition but is also meticulous work and it is easy to end up with
errors when relying on manual input – potentially requiring the entire process
to be repeated.
This is the ideal
situation for robotic process automation, which can make the comparison quickly
and without the possibility for errors. This also allows you to carry out
reconciliations as often as you like, helping to spot discrepancies that could
indicate fraud or other issues.
The benefits of financial automation
Businesses of all shapes
and sizes are increasingly adopting financial automation in areas such as these
and they are reaping the benefit. The robotic process automation market has
been predicted to reach nearly US$2 billion by
2025 and businesses are embracing the technology for good reason.
Some of the potential
benefits of automating financial processes include:
Automation tools can
massively reduce inefficiency in many workflows and processes throughout your
financial system.
This can free up
person-hours for higher level or more creative tasks, rather than having
employees constantly running through the same repetitive tasks.
This also brings with it a
financial benefit, which can be substantial when the software is used
throughout the organisation. You may find it, in fact, more than pays for
itself very quickly.
People are the biggest
asset of any organization, but human error can be a problem. This is especially
the case in the repetitive, mundane tasks already mentioned.
It can be easy to lose
focus or concentration and any errors made can be costly in terms of time,
efficiency, compliance and even reputation.
Nothing spoils customer or
client relationships faster than unpaid bills, chaotic invoicing, and a lack of
communication. Financial automation can take care of all these things, making
sure that everything leaves when it should and making sure communications are
timely and tailored.
Manual processes may
involve valuable information passing through multiple hands before being signed
off or may hit a bottleneck at some point in the workflow. Automated digital
processes can be accessed more easily, giving management and other stakeholders
access to the information they need when they need it.
