Middle Market Companies Should Wake Up to the Potential of AI in Finance
As middle market companies keep close watch over looming economic factors threatening to throw them off course, they are increasingly mindful of protecting their cash flow and finding ways to future-proof their business. Joseph Fox, chief product officer, AvidXchange, shares how investing in AI solutions for the finance department can help create more efficiencies, fill skill gaps, and provide newfound visibility into invaluable data to strengthen the entire organization.
Mid-size companies are outpacing enterprises in their adoption of artificial intelligence (AI), according toDeloitte’s latest State of AI in the Enterprisesurvey. The report shows that 80% of mid-size companies intend to increase their annual AI investments, a jump from 25% in 2018.
This comes as no surprise, given that the benefits of AI can be helpful for nearly every area of middle market business. For instance, the technology can provide stronger supply chain management, more targeted marketing, and tighter security. The finance department is another core business area that should not be overlooked when it comes to AI adoption, as finance leaders can benefit from AI modernization and, perhaps, have never needed it more.
Amidst today’s economic upheaval — inflation, a possible recession and shortages on everything from microchips to staff — the finance team is charged with minding its organization’s bottom line. The company’s future often depends on the team’s success. AI-driven solutions can help ensure that the organization stays afloat, can more readily adapt to change, and is better positioned to seize competitive advantage to ensure a more profitable future.
As middle market companies consider their overall information technology (IT) budget, below are three powerful ways that AI investments can empower the finance department and lead to a healthier, more lucrative future for the business.
As reported inThe Harvard Business Review, 52% of middle market companies surveyed byThe National Center for the Middle Market(NCMM) cited digitization as either important or extremely important, and 46% already have a digital transformation roadmap built into their strategy. AI is an important component of those digital transformation initiatives, as it can power tools that promise to create efficiencies and provide competitive advantages, such as automation.
Specifically, the finance department is ripe for an efficiency boost, laden with time-intensive tasks like reviewing documents, reconciling invoices, and processing payments. Many of the tasks can be automated with AI, freeing staff for other work while simultaneously reducing the likelihood of errors that could result in additional loss of time and money.
AI can be trained to analyze financial data, helping finance teams assess a company’s current financial well-being and forecast for the future. It also pinpoints areas of concern and can identify patterns, such as a customer that is routinely late with payments, enabling teams to make swift changes like offering a more convenient payment method to improve outcomes. Some automated financial management solutions are cloud-based, providing real-time access to financial data to any approved user whenever needed. The solutions keep data safer and can help save data owners the hassle of regularly fielding requests from internal stakeholders who rely on financial data for budgeting and forecasts.
AI solutions can also save time for external users through the use of chatbots and virtual assistants that provide 24/7 access and enhanced experiences for customers and partners.
