By Jim Kaitz, President & CEO, AFP
There’s a technology gap emerging in the practice of finance, but it’s not exactly what you think it would be. A recently released AFP survey reveals a significant gap between how important finance professionals rate emerging technology, and what they’re prepared to do to embrace emerging technology.
The survey even suggests this gap—let’s call it “the stasis gap”—is growing, and that’s a worrisome sign.
When asked, “Are organizations prepared to deal with the impact of new technologies within the treasury and finance function?” only 11 percent answered either “very prepared” or “fully prepared.” A whopping 53 percent of respondents said their organizations were “somewhat prepared”; another 36 percent said “minimally or not prepared.”
It’s an alarming finding, given the stakes. Each day brings us new revelations of digital disruption in our world. In November, the New York Times brought us word of a machine learning project “that learns to build other machine-learning algorithms.” Around the same time, Deloitte released a study claiming some 26,000 projects relied on blockchain technology in 2016 alone. DataBridge Market Research estimates that robotic process automation (RPA)—a $698.5 billion market in 2016—will account for nearly 29 percent of compound annual growth rate over the next seven years.
It’s not as though treasury and finance professionals don’t recognize the potentials of new technologies. Fifty-one percent of respondents said artificial intelligence (AI) will have a moderate or significant impact in their business. Another 50 percent gave similarly high ratings to blockchain and the internet of things, respectively, and even 37 percent of professionals thought RPA would have at least a moderate impact on their future.
At the same time, adoption rates for these technologies seem woefully low. Six percent of respondents’ organizations had already implemented some form of RPA, 3 percent the internet of things, 2 percent AI and 1 percent blockchain.
Perhaps more unsettlingly, it appears as if finance and treasury professionals are at risk of falling behind in their understanding and adoption of new technologies compared to their peers in other areas of the organization (e.g. marketing, sales, customer service and IT).
I’ve written somewhat passionately about getting ahead of the tech curve. Back in August, I worried aloud that “while this is an unprecedented time to stay out ahead of the ever-evolving tech curve, research indicates that we are notoriously slow to adopt technology or even recognize how technology could disrupt work. And we’re even more behind the curve on seizing the full potential technology offers.”
Our survey results probably won’t calm anyone’s nerves, starting with my own.
The good news is it’s not too late. Here at AFP, we’ve partnered with Oliver Wyman and Starfish Leadership to create AFP MindShift, which brings together the innovators and disruptors who will help practitioners make sense of emerging technologies.
Finance professionals are famously practical, so the whitepaper, AFP MindShift: Emerging Technologies and the Finance Function might be useful in offering some case studies that might help you get your organization focused on the technology gap:
We’re really just scratching the surface of these new technologies’ potentials. The point is, emerging technologies offer the kind help that finance professionals can’t very well refuse. Mind the gap.