“As machine learning and AI have an increasing role in the professional, it will make you more proficient, more productive, capable of taking on and handling more clients, while also delivering more value through insight, rather than through long hours of tallying up figures”
The above quote is taken from a great article on the Xero Blog about artificial intelligence and its impact on the accounting profession.
I’ve read some interesting articles on AI and machine learning and the future effect they may have on the bookkeeping and accounting industries. One recurring theme I’ve come across is the suggestion that when the AI code is finally cracked (and we’re not far off), every company will be using it within four to five years and as a result, bookkeepers and accountants will become defunct.
Trust me – not all businesses will automatically automate.
AI and machine learning will be incredible tools for only those people and businesses that choose to use them. Think back to when the first accounting software was developed and the industry became computerised. Moving from these very manual, paper based processes to a fairly automated computerised system would have:
– reduced the amount of time it took businesses to do their current accounting processes, or allowed businesses to produce more information in the same amount of time, and
– provided businesses with more accurate data in general due to reduced human error.
It seems logical that businesses would have jumped at this type of opportunity, but they didn’t. Businesses gradually implemented computerised accounting software much the same as any other service or product, on the adoption lifecycle:
Early adopters 14%
Early majority 34%
Late majority 34%
In my own career, I’ve worked with some Late majority and Laggards, who have been slow to take new software and systems on board. One client I worked with was turning over $250m, yet wouldn’t spend $15,000 upgrading their software to the next version, despite the fact that doing so would have sped up processes and provided them with better data for decision-making.
Another client had an accountant that had double-posted a fairly large month end journal. Instead of reversing the journal in the software (time required ~90 seconds), the accountant printed out a detailed ledger of the entire company to highlight the duplicates and reverse each one individually (time taken ~3 weeks). Fortunately, most of my clients now fall into the Innovators and Early Adopters categories.
With AI comes the next stage in the evolution of the accounting industry, but this will occur in the same adoption life cycle outlined above – from Innovators to Laggards.
My advice for bookkeepers and accountants is don’t be afraid of automation and machine learning software. Keep your eye on new technologies. Learn how to use them. Show your client’s how they can benefit from new technology and help them to implement it.
Manually entering information from an invoice into accounting software does not add value – help your clients grow their businesses by embracing change and challenging traditional approaches to accounting and bookkeeping.