It’s Time to Start on the Autonomous Finance Journey. Here’s Why…and How to Do It

Recently, my colleagues, Tobias Menzel - Industry Director, Financial Services, DACH Region; Jim Bretschneider, Executive Vice President, Solutions and I were invited by CFO Magazine to talk about the current state of the finance function in organizations and specifically about the role AI and autonomous finance are playing. The timing was excellent; with the current political and economic climate and resulting market volatility across the board—from financial services to manufacturing to the public sector and non-profit—businesses are being challenged from all sides.

We’re being asked to do more with less while managing through complex changes like mergers and acquisitions. Yet, we can’t afford to let up on the gas when it comes to staying competitive; we need to attract and retain talent, keep our pipelines full, and make smart strategic decisions.

All this requires support from technology. We need to integrate systems and automate them for better visibility and efficiency.

The concept of autonomous finance is still in its infancy, with finance functions in conservative industries still hesitant about it. It’s shocking how many organizations are still relying on disconnected Excel spreadsheets and manual processes. If these organizations are managing “well enough” with these conditions, imagine what they could do if they would fully embrace autonomous finance.

Moving to autonomous finance requires understanding the difference between traditional finance transformation and an autonomous finance journey. During our discussion, we outlined some steps that will help finance organizations begin their journey:

1. Identify Opportunity: Recognize the challenges in the industry and within the organization, making sure to include considerations like geography. This exercise will help identify the areas where autonomous finance can provide the most value.
   
   
2. Brainstorm Processes: Begin the journey by determining processes that will reduce manual work. This may involve implementing shared systems and reducing reliance on disconnected Excel sheets. Start with pockets of automation, such as AP invoice processing, and gradually move towards AI-supported or AI-managed processes.
   
   
3. Embrace AI Gradually: It is still in its relative infancy, and the journey towards autonomous finance will take time. Start by using AI tools as support systems, like identifying anomalies or providing detailed information for complex journal entries. Then gradually expand the use of AI as comfort levels increase.
   
   
4. Recognize Differences: Differentiate traditional finance transformation from autonomous finance. Autonomous finance promises greater automation and AI-driven decision-making. Be mindful, but don’t get hung up on mistakes of past transformation programs that failed to deliver the expected results.
   
   
5. Prioritize Data Security and Governance: Ensure data access is secure and permissions are granted appropriately and consider using natural language processing to provide rapid access to data while maintaining security.
   
   
6. Stay Informed: AI regulations are still evolving. Regulators might be behind in addressing AI issues, but companies can self-regulate and prioritize data security and accuracy.
   
   
7. Manage Investment: Start with small, progressive solutions that drive change without requiring huge upfront investments. Implement solutions that provide immediate value and gradually expand the scope of autonomous finance initiatives. This approach reveals the benefits of autonomous finance without forcing companies to take on excessive risk.
   
   
8. Embrace Finance Tech: Embrace a comprehensive finance architecture that combines accounting hub and subledger technology, an accounting rules engine, and a modern ERP/thin General Ledger offering. This architecture should be tightly integrated to facilitate reconciliation and drill-back.