By Colin Timmis, Country Manager, South Africa, Xero
Thanks to the movies that come out of Hollywood, a lot of people think that robots are about to take over the planet – or at the very least, our jobs. While artificial intelligence (AI) is gaining ground across a range of business functions, it’s not about to expel humans from the workplace. This fearful perception is in fact distracting us from focusing on the very real opportunity these technological advances bring.
Before we go any further, we need to emphasise that AI’s business benefit is not that it replaces the need for employees, but that it helps them do their job better. Nonetheless, using these new tools can be a big change – which can seem quite daunting…
We often forget that most small businesses and their advisors are already using a supercomputer with machine learning capabilities, including virtual assistants, smart reply functions on email and calendar syncing. AI is constantly evolving as technology gets smarter. It’s pretty exciting to think that in the future small businesses and their advisors will be able to get even more out of AI as it develops further.
The impact of artificial intelligence and machine learning are clear: over the past 12 months, we have delivered 1 billion recommendations and automated codes in the Xero platform across bank reconciliations, invoices and bills
AI unlocks time
Sounds like science fiction, but it’s not: AI can save your business time by doing all the repetitive administrative work like calculations, reconciliations and information verification. This means small business owners can focus on the parts of their business that they are most passionate about and accountants will have more time to advise their clients on how to grow their businesses.
For example, we process in excess of 800,000 invoices every day. With our automated codes, we stand to save more than 307 hours per day across small businesses globally. The true value of saved time is that it can propel business growth and boost profit. And this, in a nutshell, is the real benefit AI brings to businesses of all sizes.
AI and the cloud
The professional application of machine learning and AI depends on the cloud and access to data. After all, the smartest device still needs information to do anything clever. So, cloud technologies provide a massive advantage. The cloud has harnessed the insight of millions of users to create the foundation on which AI and machine learning is built.
AI tools can analyse this data for actionable insights, helping small business owners improve efficiency and performance while further eliminating repetitive, manual and tedious tasks.
AI doesn’t just collect information – it learns from what it stores, and enables humans to use the information in innovative ways.
The potential here for accounting software – and accountants – is huge. Software apps and platforms can now automatically conduct information analysis without human oversight. Tasks like bank reconciliation, reporting and cash flow updates are taken care of – freeing up time to focus on areas of the business that matter most.
AI and the small business
Machine learning is not limited to internal data; external information is a critical source of actionable insights.
It will make use of machine learning technology and transactional data to provide businesses with a comprehensive financial overview. They’ll be able to see at a glance who owes them money, when their next bill is due, or how much money is in their bank account. For small businesses with limited resources, this gives them greater control over their cash flow, enabling them to make faster, better decisions.
AI and the advisor
Clever accountants will soon realise, if they haven’t already, that AI presents opportunities for their profession. Machine learning cannot match human insights, but it can complement a good accountant’s brain power. It does all the heavy-lifting, empowering humans to navigate the emotional complexities and grey areas of the working world with better insights. And it learns fast, too – after coding just one invoice, our machine learning techniques understood invoicing behaviour well and already reduce errors. By the fourth invoice, early machine learning implementations were accurate over 80% of the time, and by the 50th invoice they consistently reached over 90%.
Arthur C. Clarke once said, “Any sufficiently advanced technology is indistinguishable from magic”. There is no doubt that machine learning and AI will have an increasing role in the accountancy profession – and for the better. AI is transforming accountants from number-crunchers into proficient and productive business advisors; sounds like a magical prospect for both accountants and their clients.