Industry executives and experts share their predictions for 2024. Read them in this 16th annual VMblog.com series exclusive.
Top AI Concerns and Opportunities for Finance and Accounting Teams in 2024
By Anita Samojednik, CEO, Paro
As leaders look toward the financial landscape of the future, the integration of artificial intelligence (AI) within finance and accounting operations becomes less of a choice and more of an imperative for thriving in the modern digital era. However, the adoption of AI in today’s finance and accounting departments still has some way to go. Findings from Paro’s 2023 Future of Finance survey highlight the dynamic relationship between today’s finance departments and the enablement of AI, with 83% of responding finance leaders acknowledging the importance of AI and machine learning (ML) in shaping the industry. However, 42% of businesses have still not embraced it.
While the promise of AI in finance and accounting is evident, and leaders are becoming more interested in embracing these technologies, widespread adoption faces considerable hurdles. Technology and data challenges, regulatory complexities, resource constraints, and the need for cultural and leadership shifts are the obstacles finance teams must overcome to become strategic catalysts for future success. As finance teams continue to navigate the evolving intersection of AI and finance, below are the emerging industry trends, concerns, and opportunities regarding AI application that we predict to see over the next year.
Upskilling to Meet Demand for Analytical Proficiency
The role of finance is rapidly evolving from backward-looking reporting to forward-looking strategic advising. Simultaneously, AI is radically transforming finance and accounting by changing how teams operate and interact. These shifts require strategic enablement and expertise to adapt to new roles, skills, and processes.
Notably, Paro’s survey found a lack of advanced analytical skills within finance teams was prevalent. Over half of the respondents expressed concerns about their teams’ proficiency in this crucial area, with C-suite executives particularly flagging this as a weakness. In the era of AI-driven finance, there is an increasing demand for advanced analytical skills to harness the full potential of emerging technologies. As 2024 approaches, expect finance leaders to further invest in upskilling their teams to address this skill gap and ensure AI can be effectively leveraged throughout their organizations, leading to strategic decision-making and enhancing the ability to service customers efficiently.
Building Trust in the Era of AI
The transition to AI-driven finance and accounting is not without its concerns, particularly surrounding ethics, biases, and security. Cybersecurity and data security have emerged as top worries among finance and accounting executives, echoing broader hesitations about the risks associated with digital transformation. Loss of human judgment or oversight, cost considerations, and a lack of transparency are also vital factors.
To thrive in the AI era, finance and accounting teams must develop robust strategies to build trust in AI processes and address these concerns head-on. Further, organizations cannot simply invest in AI without also investing in the human expertise to develop and interpret the AI’s outputs. A commitment to transparency and accountability will be pivotal to ensuring seamless AI integrations without compromising data integrity or human oversight.
Embracing Shift from Transactional to Strategic Collaboration
Amid the challenges, there are positive shifts within the finance and accounting landscape. More than half of the respondents in Paro’s Future of Finance survey have already embraced AI/ML technology, primarily in predictive analytics, process automation, and personalization. Finance teams anticipate increasingly partnering with other business units, representing a transition from transactional support to strategic collaboration. It’s also expected that there will be an increased adoption of AI/ML in recruiting, hiring processes, and long-term strategic planning, which will accelerate a broader trend toward using intelligent technology to drive holistic business growth. As the finance and accounting ecosystem evolves, these strategic collaborations will create a foundation of success for organizations navigating the complex modern digital era.
Further convergence between AI and finance and accounting is undeniable in 2024. Those who embrace the transformative potential of AI will emerge as strategic leaders, guiding businesses through the ever-changing technological landscape, while companies that don’t evolve will underperform peers and become less competitive. The challenges outlined in navigating AI adoption are stepping stones to overcome in creating a more intelligent and adaptive financial landscape. In 2024, expect to see more widespread initiatives by business leaders to prepare for and harness the benefits of the AI-transformed finance function, which will, in turn, help drive better business decisions and create a more resilient and innovative industry.
##
ABOUT THE AUTHOR
Anita Samojednik is the Chief Executive Officer at Paro, a Chicago-based startup disrupting the way companies access on-demand financial expertise. Since joining the company, Anita has leveraged artificial intelligence to redirect Paro’s focus to investments that drive predictable growth, while leading integrated operations as the company scales.
Anita came to Paro with more than 20 years of executive leadership experience at Groupon (former Groupon International President), Ladders and Vonage, where she ran multinational two-sided marketplaces and e-commerce enterprises while using cutting-edge machine learning and artificial intelligence techniques. Anita serves as a member of the advisory board at the Columbia Business School, Deming Center.
