Advice and Information for Finance Professionals

The Future of Shared Services is Intelligent

Guest Author

By Arun Khehar, SVP Applications ECEMEA, Oracle

Companies have always viewed shared services as cost centres and looked for ways to make them more efficient. The ultimate goal is to convert shared services into a value generator, or at the very least keep the cost of running them to a bare minimum. Why invest heavily in routine tasks that are of marginal strategic value to the business?

But while companies have made significant leaps in recent years, the time and money required to run these operations continues to dwarf the returns.

Enter intelligent process automation. IPA marks a major leap in the quest to optimise shared services.

IPA is Changing Everything

Unlike the mechanical robots used in manufacturing, the virtual “bots” used in automation software are designed to mimic human keystrokes at a computer—which means they can handle clerical jobs, more quickly and accurately, at a lower cost.

Learn the about the new vision for shared services in our ebook.

For years, businesses have been chasing a nirvana state of “lights-off” processing for routine tasks, but haven’t been able to shake the enormous time investment required to manage even the simplest tasks. The advent of AI, chatbots and other forms of “intelligence” has finally put companies in a position to clear this hurdle.

When you add AI (artificial or adaptive intelligence) to routine processes, the software is no longer driven by pre-defined rules. Instead, adaptive algorithms learn as they go, becoming smarter and more efficient over time.

Adding AI to the Mix

Think about account reconciliations, for example. Today, most companies’ accounting staff spend a fair bit of time performing reconciliations across systems. In very large corporations, it’s not uncommon for people to reconcile thousands or tens of thousands of transactions—across ledger and bank, ledger and sub-ledger, and other transactions across different systems—some internal, some external. Many of the mismatched reconciliations follow standard patterns: an entry was made twice, or with a negative sign instead of a positive.

By using AI and machine learning to recognize and handle these patterns, IPA can automate up to 80 percent of these reconciliations. In some cases, IPA will prompt you to review and sign off on the pattern it has identified. If you click “approve” enough times, the software will learn from this and ask if you’d like future situations to be approved automatically.

Once that’s done, you won’t need to reconcile such discrepancies; the software will do it automatically. This will allow your people to focus on the 20% of reconciliations that are more complex and require human judgment.

A true, touchless approach to shared services is still some time away for most companies, however. They must apply rigour when standardizing their processes; otherwise, applying IPA to shared services will only result in automating bad decisions. Automation shows its true value when it influences human decision-making for the good of the organization.

Oracle Adaptive Intelligent Applications for ERP is an early example of this concept in practice. The application monitors supplier invoices for those that offer discounts for early payment and flags these opportunities so that finance teams can better prioritise their payments.

From Cost Centre to Value Generator

The cost-savings associated with IPA are enormously attractive. Some estimates suggest automated services will cost just 10% of what it costs for people to do the same work. IPA will undoubtedly reduce the shared services workforce, as it becomes possible for business users to find information through self-service technologies or by speaking with a chatbot.

At the same time, however, shared services workers will have the opportunity to step out from the back office and offer more strategic support with more value-added activities. Some good examples of this can be seen here at Oracle. We recently established a shared services team in Cairo that supports our sales force with research, presentations and demos to help close deals. We have another centre in Romania that supports sales and marketing efforts with customer referencing programs, as well as managing social media channels. These shared services activities are not focused on routine transaction processing. They perform high-value, strategic tasks that are critical to the success of our business.

There is likely to be a similar evolution among finance shared services, as IPA eventually executes most transactions. Finance staff can focus on more strategic activities, such as FP&A, data analysis, and answering “what if” questions for finance leadership. Their skills will be relied upon by senior leadership looking to identify the next market opportunity or acquisition.

The future of shared services is not just intelligent. It’s strategic.

Learn more about the future of shared services in our ebook.

Be the first to comment

Comments ( 0 )
Please enter your name.Please provide a valid email address.Please enter a comment.CAPTCHA challenge response provided was incorrect. Please try again.