By Emma Hitzke, Senior Product Marketing Director, Emerging Tech, Oracle
Research from Oracle and Enterprise Strategy Group (ESG) shows that organizations adopting emerging technologies are reaching new heights in efficiency. And when artificial intelligence (AI), the Internet of Things (IoT), and blockchain are built into commonly-used applications like ERP, organizations are seeing jumps in finance and operations efficiency without long waits or heavy lifting. We presented these findings in a recent webcast with CFO.com.
Incorporating AI into ERP systems can yield a 36 percent drop in errors and reduce the time it takes to close the books by 3.5 days. These findings are from a global survey of 700 finance and supply professionals, conducted prior to the global pandemic. One significant top-line finding is that 84 percent of organizations are using at least one of these four new technologies: AI, IoT, intelligent voice assistants, and blockchain.
These technologies are returning big results in finance and operation, which is helping them build resilience in a time of uncertainty.
On average, finance teams using AI report a 30+ percent improvement in productivity, 32 percent improvement in forecast accuracy, and 37 percent reduction in errors. These results demonstrate the power of eliminating manual tasks by adding intelligent automation to back-office processes.
Oracle builds AI capabilities directly into Oracle Cloud ERP and Oracle Cloud EPM. Our own finance team uses these capabilities to automate reconciliations and close the books faster. In Oracle Cloud EPM, we are using the financial consolidation and close capability—along with enhanced narrative reporting—to basically auto-populate our financial statements. For day-to-day performance management, we’ve incorporated Oracle Analytics to automate business intelligence, data visualization, and predictive analytics. Like the survey respondents, we’ve seen big results, including a 35 percent reduction in manual accounting, shortening of the monthly close by four days, and a streamlining of our global P.O. accruals process (now 3 hours a month) and our global accounts reconciliation processes (now 1.5 hours a month.)
AI-powered chatbots are making a difference in efficiency and speed as well. Companies using chatbots had an average 36 percent productivity improvement and 38 percent faster analysis, and 65 percent of respondents said conversational technologies are streamlining forecasting and reporting processes. These, too, can come prebuilt within Oracle finance applications. For example, the Oracle Digital Assistant can help with project management by displaying relevant data to a project manager automatically, eliminating the need to look for information across multiple systems.
The research shows that emerging technologies are leading to big improvements in supply chain and operations, too. Companies that have incorporated these technologies have achieved more benefits than expected. For example, companies that use IoT reduced fulfillment errors by 25 percent, manufacturing downtime by 26 percent, and inventory stock-outs by 30 percent. Overall order fulfillment times also fell by 6 days.
Digital assistants are a driving force for these improvements. Companies said these assistants helped them speed up supply chain analysis by 26 percent and boost employee productivity by 28 percent. In addition to improving core KPIs, digital assistants offer a better experience for supply chain professionals; they no longer need to look through multiple systems to keep track of inventory and other assets.
IoT also is driving return-on-investment: 88 percent of organizations say ROI on IoT has met or exceeded expectations.
Titan International, a global wheel manufacturer, has made substantial process improvements since adding Oracle Cloud Supply Chain to its IT footprint (which already included Oracle Cloud ERP). Using embedded sensors and IoT to track work-in-process helped the company introduce real-time production planning and monitoring, enhance production scheduling and customer service, and improve inventory accuracy.
The AI capabilities built into Oracle Cloud provides preventative maintenance alerts, improving equipment efficiency and safety.
Manufacturers also are using blockchain to boost efficiency and gain ROI. Eighty-seven percent of those surveyed said blockchain applications are exceeding the expected return on investment. One popular application is Oracle Intelligent Track and Trace, which builds trust among suppliers.
In challenging times like these, companies are looking for faster time to value. Survey respondents said they prefer to use pre-built AI and machine learning technologies 2-to-1 over building their own, to help them keep up productivity and efficiency as much as possible. Our survey respondents see emerging technologies as an important driver. Looking at the next 5 years, 83 percent expect AI to completely automate the financial close; 77 percent believe most financial approvals will be automated; 78 percent believe blockchain will reduce fraud by at least half; and 74 percent believe that intelligent automation will be critical to keep pace with rapidly shifting regulations.
But you don’t need to wait five years to take advantage of these efficiency gains. With emerging technologies built directly in Oracle Cloud applications, you can get started today.