How Embracing Disruption Transforms Finance and Accounting
It seems like every five minutes, technology companies introduce a new product that promises to transform the way you work, a digital disruption that will simplify daily processes. The finance industry is not known for embracing disruption, but with the way business is changing, it's time to get on board.
According to the 2017 Rosenberg survey, the overall percentage of senior partners over the age of 50 has increased from 51.5 percent in 2005 to 62.7 percent in 2016. The takeaway? These partners will soon age out, and Gen X and millennials will become the key decision-makers. In fact, according to Pew Research, millennials are the largest generation in the U.S. labor force right now, at 35 percent. Millennials are generally more comfortable with technology, and as they become decision-makers, they may introduce significant disruption into finance organizations as a whole — disruption that will land squarely at the fingertips of accounting professionals.
The Biggest Disrupter is at Our Fingertips
Technology is the single biggest disrupter in finance and accounting. According to a PwC report, 47 percent of job categories are open to automation within two decades, with accounting being the second most at-risk profession. While the benefits of automation are still unclear, automation has the potential to eliminate the routine accounting tasks that are easy to mess up due to boredom. Enterprise resource planning (ERP) and other software systems already do this to some extent, generating reports and automating procure to pay, order to cash, and record to report processes.
Automation isn't the only way technology is changing the accounting profession. The International Federation of Accountants expects big shifts in accounting due to cloud-based systems, big data, the integration of non-traditional financial information, productivity gains and mobility — and the role of accountants is expected to change as a result.
Data from other business systems and external sources are being integrated with accounting systems, and much of this is sitting in the cloud as a service rather than on-premise on a desktop computer. Accounting professionals are also using mobile devices to complete tasks.
Natural language searches and embedded artificial intelligence engines make it easier than ever to find information even in the most Byzantine of systems, while analytics help accountants with forecasting at a more accurate rate than before. The rate of change is only accelerating, and what an accountant does in ten years may be radically different from their job today.
Connections are Critical for Embracing Disruption
But technology is not without its limits. As financial organizations embrace disruptive technology, business environments often become hybrid IT environments, with applications both in the cloud and installed on servers or individual desktops. Unified Communications-as-a-Service (UCaaS) is becoming a part of this environment, enabling communication via multiple platforms so that employees can improve productivity and work remotely.
But there are no guarantees with any system, especially if it doesn't integrate with the rest of the business or requires repetitive data entry. In fact, if it's not properly integrated with other enterprise systems, UCaaS can actually hinder productivity, defeating the purpose of introducing new technology.
Non-traditional financial information gleaned from customer relationship management (CRM) systems and external data sources need to integrate with a UCaaS platform and with financial systems. If these are not integrated, productivity suffers. For example, if data entered into an accounting system cannot be accessed by customer service representatives, they may not be able to provide the information requested by customers.
On the flip side, accountants working directly with customers need to record information, but are often not as immersed in CRM systems as sales professionals and may not take notes on the call. Ultimately, it will take longer to complete tasks as employees search through multiple systems to find out the status of an account.
APIs are critical for helping accounting professionals embrace disruption by making it easier to automate reports and forecasting, connect with customers, and grow their business — which, in a world where disruption is a certainty, is a huge win.
APIs Bring Systems Together
These systems can be integrated with application programming interfaces, or APIs. Modern UCaaS systems include APIs that connect to existing business applications, including CRM and ERP systems. This allows calls and other communications to be logged throughout the business, cutting down on the time spent searching for information.
Additionally, the systems can also be used to identify trends, which can be used for forecasting purposes. APIs are critical for helping accounting professionals embrace disruption by making it easier to automate reports and forecasting, connect with customers, and grow their business — which, in a world where disruption is a certainty, is a huge win.
Rather than waiting and seeing what disruption has in store for the finance world, it makes sense to embrace that disruption and prepare for it. And the best way to do that is to get to know the technologies that will be changing the way we do business forever.
