While many finance leaders were hesitant to adopt artificial intelligence last year, the transformative power of AI technology has won finance teams over. According to Gartner research, less than 40% of finance professionals were taking advantage of AI in 2023. However, analysts predicted a dramatic shift by 2026, with 90% of finance functions expected to utilize AI and half of all new hires in top finance departments coming from non-finance backgrounds.
New research from Gartner shows that the prediction may have been too conservative. Today 87% of teams are using AI at a moderate to high rate. This rapid adoption indicates that finance leaders recognize AI’s potential to provide organizations with a competitive edge through intelligent automation and data-driven financial insights. In fact, nearly three quarters (72%) of CEOs say competitive advantage depends on who has the most advanced generative AI.
The Future of Finance is Intelligent
As more finance teams turn to AI-powered tools to augment human expertise, finance leaders are looking for technology partners who can empower their teams to work smarter, not harder. This is particularly true for financial planning and analysis (FP&A) teams responsible for budgeting and resource planning necessary for business success. AI can help FP&A teams produce vital forecasts faster and therefore more frequently – significantly improving on current forecast cadences:
- 58% of budgeting cycles are longer than 5 days
- 48% of FP&A teams only budget quarterly or less often
While 80% of finance leaders believe AI will enhance productivity and strategic insights, only 20% of organizations have a comprehensive AI strategy.
Approach to AI for FP&A
As an ever-evolving market drives the need for greater business agility, finance leaders are squeezed in a difficult situation. Legacy systems hinder agility, while economic pressures demand optimization. Just throwing technology into these problems won’t unlock true potential. You need strategic investments that create new opportunities, not only solve existing ones.
Manual vs. Automated Processes: Bridging the Gap with Automation
Finance teams contend with a wide range of automated financial reporting needs. Due to the lack of automation in tasks such as account reconciliations, accounting and finance professionals spend more time manually preparing data and reports and less time analyzing account balances, such as reviewing trends from prior years and months and actual versus budgeted trends.
In fact, just recreating reports and transferring information between systems takes up a massive amount of time. At least three quarters (75%) of finance teams dedicate a minimum of five to six hours each week to recreating financial reports, equating to up to 24 hours a month or 300 hours per year. This inefficiency highlights the need to streamline processes and improve data management, including automated data integration.
By automating repetitive, manual tasks such as report generation and data integration, finance teams can significantly reduce operational costs, improve data accuracy, and free up valuable time for strategic analysis. Modern financial performance management platforms offer robust capabilities to streamline processes, enhance collaboration, and provide real-time insights. These solutions empower finance teams to focus on higher-value activities, such as financial planning and analysis, risk management, and driving business growth.
Ready to transform your FP&A team with data-driven insights? Discover how Davisware can empower smarter decision-making and streamline your financial processes – schedule your demo today!
This blog was written in collaboration with our partner, insightsoftware
About insightsoftware
insightsoftware is a global provider of comprehensive solutions for the Office of the CFO. We believe an actionable business strategy begins and ends with accessible financial data. With solutions across financial planning and analysis (FP&A), accounting, and operations, we transform how teams operate, empowering leaders to make timely and informed decisions. With data at the heart of everything we do, insightsoftware enables automated processes, delivers trusted insights, boosts predictability, and increases productivity. Learn more at insightsoftware.com.
