It has been a challenging couple of years for SMEs. In a pandemic that affected virtually every industry, companies have been having to make sweeping changes to their working practice. A big part of this has been the level of digital transformation and the use of technology in order to make life easier.
There can be no doubt that artificial intelligence (AI) has a huge role to play in the future of all areas of management and finance. Finance teams in SMEs have the opportunity to utilise various forms of AI to not only provide greater efficiency and productivity for the company but also to save money.
Here’s how SME finance teams can build their short- and long-term strategies around the use of AI:
The growing importance of automation
AI is being used in the automation of tasks to great effect. In work that requires a great deal of manual effort, AI can be used. For example, computers are able to search through data for specific patterns far more quickly and accurately than humans can. AI allows the software to learn as it works and become more effective.
Typically, process automation revolves around taking the are repetitive and use software to do it. This has the potential to revolutionise processes in SME finance teams.
Dealing with data
Managing data is an important part of any finance role – but too many SMEs simply use spreadsheets. This kind of work is labour intensive for the employee, but also easy to make mistakes.
AI is far more adept at handling large quantities of data than humans. Many businesses are reluctant to put data in the hands of AI for fear that mistakes will be made. But it fact, for most companies, the opposite is true: data managed by AI is typically far more accurate.
A slow adoption
There is no need for AI to be thought of as all-or-nothing. It is well understood that AI is not ready to be deployed across businesses in order to take on large swathes of work. However, there are plenty of operations where AI can be used as an aspect of it.
Don’t assume that your business is not ready for AI at all – actually, it is usually the case that small elements of AI can be integrated into simple process automation that can be ideal for almost any SME.
Understanding the limits of AI
When we think about finance, it is important to understand that there are limits to the abilities of AI, and areas in which only human input, ideas and guidance are effective. This is part of the huge advantage of using AI for automated processes, as it can free up the time for staff members allowing them to be free to pursue more business-critical work.
It is also true that any kind of financial advice has to be personalised to the individual, and this is not something that AI is capable of. Take the delicate issue of investments for pensions. “When you pay into a pension plan, your money goes into investment funds, such as the stock market, bonds, property or cash,” says Adam Reeves of Reeves Financial “as with any investment, the fund value may fluctuate and can go down as well as up. In some cases, there is a possibility your plan may be worth less than the total you have paid in. If you are risk-averse you can choose lower-risk investments, however, you need to weigh this up with how your investments may grow.”
The fact that AI is now being used by businesses of all sizes to help streamline their processes and improve productivity is a testament that now is the time to invest. SMEs that fail to make AI a part of their financial strategy run the risk of being left behind by competitors who are able to prioritise other aspects of their finance team.
If you are yet to involve AI in your financial strategy, it can be a great idea to get in touch with specialists who have an understanding of your industry and how to implement AI most effectively. This is something that is going to be different for every company, so you should not assume that a blanket plan will be effective.
Article by Annie Button – Finance & Business Writer
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