Surviving the AI revolution is on the minds of workers and CEOs alike according to a recent PwC survey conducted at the 2024 World Economic Forum Annual Meeting at Davos. When asked what impact generative AI would have on their business, almost 75% of CEOs said “it would significantly change their business in the next three years.” Some (45%) expressed doubts about their business’ ability to adapt to AI and other large-scale changes.
Accounting and finance professionals also have expressed concerns about AI and its impact on their roles and organizations. In a recent IMA study, experts in the field and accounting/finance leaders spanning the U.S., Europe, Asia-Pacific, Middle East, North Africa, India, and China, shared their challenges with AI. These challenges were divided into the human, operational, data management/technology adoption, and ethical/governance challenges.
The majority of respondents (38%) cited the challenges related to people as their biggest hurdle to AI adoption. Over a third of this group believed there is a significant skills gap in the current workforce i.e. a lack of analytical skills in dealing with the data necessary for AI implementation and the mindset for interpreting the results. Another third of this group cited a lack of stakeholder buy-in as the greatest barrier i.e. strong resistance to the adoption of AI from senior- and mid-level management due to the fear of losing control to AI. But the most significant challenge to AI adoption is the absence of support from top leaders with 45% of respondents citing this was the most significant human challenge. It is clear from the data that tone at the top undoubtedly plays a crucial role in the success of AI initiatives.
Accounting and finance teams who successfully integrate AI into their workflows can realize higher productivity, reduction of human error, enhanced predictive and prescriptive analytics, and a reduction of monotonous responsibilities. These capabilities can positively impact everything from financial reporting to controls/compliance to financial planning & analysis (FP&A). Additionally, investing in AI means teams can focus on higher value activities like strategic planning as routine tasks become automated. When organizations commit to workload-reducing technology, they are also gaining a powerful recruitment and retention ally, especially organizations interested in attracting young talent.
Success stories around accounting and finance teams who integrated AI early are plentiful. IBM recently discussed how generative AI models can process, summarize, and create narratives around financial performance. They also described how self-service solutions can be deployed across the organization, creating data democracy and one single source of truth. This facilitates greater levels of business partnering and trust.
Generative AI will not replace the need for human validation of machine-generated outputs. The human element is always a necessary part of the AI equation. The humans working with AI systems must understand how they work, where they get their data, and how relevant their conclusions may be. IMA stresses the need for every accounting and finance professional to become acquainted with AI and the algorithms behind AI models. There is also an ethical component to AI only humans are equipped to navigate. For example, some AI models may be flawed because their data is biased. Humans are the only ones who can raise relevant ethical questions and seek ethical answers.
IMA is interested in ensuring every accounting and finance professional survives and thrives using AI. The benefits of AI systems are significant and early adopters of the technology gain a competitive advantage quickly. Upskilling in this technology and leading teams through radical changes in how they work will be necessary for any accounting and finance professional who wants to assume a leadership role.