Job automation is only going to increase, according to a recent report from McKinsey & Company. The report finds that up to 45 percent of activities individuals are paid to do can now be automated, just by adapting technology that already exists. Those activities represent about $2 trillion in annual wages.
What Does This Mean for Accounting Firms?
The rise of artificial intelligence (AI) means that algorithms are now able to automate some existing business processes, helping to both solve problems and uncover value through measurable, direct ROI. Take tax compliance work, for instance. It currently requires the “crunching and collating of numbers” by a human to inform a business decision.
This means that the accountant needs to first understand complex sets of data and then produce an accurate and timely report. AI readily possesses the ability to process this same data and almost immediately deduce an unbiased, strategic business decision – relieving the company of this human-driven and otherwise labor-intensive, costly, and subjective decision function.
However, accounting firms are able to overcome this threat by finding new ways to differentiate their services. Here are the three ways that the industry is beginning to tackle the threat of automation.
1. Mobilize knowledge from across your business. Knowledge is a key factor in facing the threat of automation. Industry insight, experience, and understanding of clients are all things that can’t be easily replicated by the competition – even machines.
That said, knowledge could easily become “siloed” if the right communication and collaboration resources are limited. And with an increasingly global economy, even small companies need to operate across multiple locations further isolating valuable knowledge. Being able to access and share knowledge across an entire organization (regardless of location or team) is a huge asset, one that is extremely valuable when under a growing threat from AI.