What is Finance Automation and How Does it Help Businesses?
Business process automation is streamlining knowledge-based jobs like sales and accounting the same way automation reduced the number of people necessary to run an assembly line. Automation is affecting sales, customer support, IT and finance. What is finance automation? And how does it help your business?
What Is Finance Automation?
Finance automation is the automation of any finance job or task. It may be done by robots or artificial intelligence tools. According to an EY study, two thirds of finance leaders are making finance automation a high priority.
How Does Finance Automation Help Your Business?
Finance automation gives you greater insight into your process. How many purchase orders are outstanding? How many purchases has a given customer made? How much money came in this month, and how many invoices are outstanding? A side benefit of financial automation is that it reduces the risk of fraud. Your system could flag any duplicate purchase orders or payments for review, and you can stop them before the payment goes out. The auditor can see what is going on in real time, and their review of the transaction is not known to those making the request. This is true whether you’re in charge of expense management, payroll or accounts payable.
Finance automation dramatically reduces error rates, assuming it is tied into your other systems like your enterprise resource planning system. This will save your employees time, since they don’t have to enter information as the purchase request becomes a purchase order becomes a shipping label.
There are financial reasons to automate your accounts payable. Robotic process automation can reduce the labor involved in certain processes by up to fifty percent. A more modest Gartner Report predicts that automation will improve the productivity of the average finance team by thirty percent.
Financial automation doesn’t eliminate the human element, but it frees them up to deal with more complex issues. For example, automated payroll solutions allow employees to change their tax withholdings and get copies of their pay stubs. This allows payroll staff to deal with issues like wage garnishments and incorrect timecards.
Automated invoicing ensures that you never fail to bill your client and know when they’re slow to pay. These tools are invaluable for small business owners, since it can be used to automatically send them an invoice with the ability to pay online. Furthermore, you don’t have to waste time on bookkeeping because the data is automatically fed to your accounting software.
Consolidated and customizable reports make the job of financial controllers and auditors infinitely easier. General managers may appreciate the data, too. For example, the financial systems may automatically feed information on total accounts year to date, customer attrition rates or any other metric you select to an executive dashboard. You can compare performance to key performance indicators in real-time and address them rather than wondering what happened when you get a monthly report.
Financial automation has secondary benefits. For example, faster processing of vendor payments will strengthen your relationship with your vendors. Faster processing of expenses reports and sales commissions will be appreciated by your employees.