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Finance today and tomorrow
The document discusses the changing roles of finance and IT due to increasing automation. It notes that while robots are already performing many routine tasks, cybersecurity risks and analyzing large amounts of data will still require human skills. As automation continues, the roles of finance professionals will shift from transaction processing to more strategic activities like forecasting and decision making. Both finance and IT workers will need a blend of skills to collaborate in addressing new challenges and opportunities.
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Finance today and tomorrow
- 1. ArgonPro consulting training Finance today andtomorrow… Some thoughts about the changing and developing role of finance and IT 15.1.2016 Timo Nurminiemi
- 2. ArgonPro consulting training 2 AGENDA Finance today andtomorrow 1. How did we end up here…? 2. Are robots stealing our jobs? 3. The world is not quite ready 4. When everything has been automated… 5. What did we learn…?
- 3. ArgonPro consulting training 3 15.1.2016 3 How didwe end up here...?
- 4. ArgonPro consulting training 4 History in brief… 60’s Invoicing using typewriters, document transfered by ordinary post, book-keeping machine, own (physical) cash box, … 70’s 80’s 90’s 2000- DOS-OS, first ready-made software for finance and accounting, need for specific account numbers in accounting, first general chart of accounts in Finland (1978), … First PC’s, floppy discs, printers, spreadsheets, MS Excel (1985), Lotus Notes 1.0 (1989), Windows 1.0, … Windows becomes more common, OLAP-tools, Internet, ERP systems becomes more common, electronic data transfer, first financial shared service center set up in Finland, … Paperless office, digitalization, forecasting, analysing, data warehouses, grafic reporting, dashboards in reporting, business intelligence, …
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- 6. ArgonPro consulting training 6 http://www.wsj.com/articles/robots-dont-mean-the-end-of-human-labor-1440367275 In certain businesses robots and automationhas replaced human labor almost totally
- 7. ArgonPro consulting training 7 The robot densityin the general industry (all industries excluding automotive 2014) Rep. of South Korea 365 Japan 211 Germany 161 Sweden 142 Finland 122 http://innorobo.com/en/about-innorobo/the-industrial-robotics-market-in-europe/ There’s still room for improvement in Finland…
- 8. ArgonPro consulting training 8 http://qz.com/196200/toyota-is-becoming-more-efficient-by-replacing-robots-with-humans/ Sometimes you needa step backward… ”But Toyota is deliberately taking a step backward…”
- 9. ArgonPro consulting training 9 http://greenjobinterview.com/2015/02/recruiting-robot-human-interaction-ancient-news/ Robots are alreadyinvolved in all kinds of administration and support work and activities - Finance, IT, HR,…
- 10. ArgonPro consulting training 10 http://www.active8robots.com/blog/collaborative-robots-bringing-work-back-home/ From Offshoring toReshoring… ”Reshoring … whether for financial, quality or ethical purposes.”
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- 12. ArgonPro consulting training 12 Buy-/sellside robots in financialmarkets have already caused quite a many market disturbances… Elwin de Groot (Rabobank): “Blame the robots” for Greek market wobbles (June 2015)
- 13. ArgonPro consulting training 13 http://finance.yahoo.com/news/i-asked-a-few-robots-how-i- should-invest--here-s-what-they-said--131949010.html “Yet after goingthrough these exercises, it occurred to me that none of the robots know anything close to my whole situation. They never asked about my present employer Vanguard 401(k) account, an IRA rollover from another corporate retirement plan, my wife’s assortment of former-employer stock, whether we own a home or have 529 college-savings accounts or have lots of debt, or whether I have a habit of overpaying for antique maps now and then. Those are the things that only an investment advisor with a pulse, a business card and a license would ask. And it’s why many people won’t be ready to let the robots run their finances, no matter how smart and friendly they are. Lost game?
- 14. ArgonPro consulting training 14 “By passing logic testslike this, robots are able to build up human-like reasoning skills that will prove useful in future technology such as driverless cars.” However, the development continues…
- 15. ArgonPro consulting training 15 ”Company boards are alsosoon likely to feature a robot-like intelligent system that will forecast, calculate and take management decisions with incomparable efficiency and speed.” http://www.opuscapita.com/news-and-events/robots-soon-in-financial-management-and-company-boards “…wherever the world’s best robots are, you will also find the best jobs”
- 16. ArgonPro consulting training 16 http://diginomica.com/2015/09/15/finance-and-accounting-next-target-for-the-robot-revolution/#.VpKBo1U8L4Y This development path willrequire even more solid and uniform relationship between finance and IT functions. Robots already implemented in finance and accounting RPA = Robotic Process Automation
- 17. ArgonPro consulting training 17 http://www.accaglobal.com/gb/en/member/accounting-business/insights/robot-takeover.html “RPA can openan email, examine the attached spreadsheet, and check that the information complies with set rules”
- 18. 18 The world isnot quite ready…
- 19. ArgonPro consulting training 19 Cyber attacks arehere! Sources: FICS/Cyberlab, 2014, Jukka Viitasaari, Teollisen internetin tilannekuva 2014
- 20. ArgonPro consulting training 20 Fake president fraudson the rise… http://belgium.marsh.com/Portals/95/Documents/Alert%20FPF%202pager.pdf http://www.channelweb.co.uk/crn-uk/news/2440228/fake-president-fraud-on-the-rise-deloitte-warns http://www.aig.com/chartis/internet/uk/eni/aig-fraud-alert-a4- 3page-v5_tcm2538-516102.pdf
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- 22. ArgonPro consulting training 22 ”IDC: The amountof digital information is going to explode by 2020” In digital world only 25 percent of data is original and the rest (75 percent) is copy. Who will pick and process this massive amount of (finance) data and evaluate what is relevant? And what are the tools for that? Based on estimates approximately 0,5 percent of new data is coming from Finland 20202010 2012 2014 2030 1 333 ZB 44 ZB 1,2 ZB 4,4 ZB
- 23. ArgonPro consulting training 23 Spreadsheet risk… When was thelast time you even thought about this…? http://www.eusprig.org/horror-stories.htm
- 24. ArgonPro consulting training 24 http://ww2.cfo.com/spreadsheets/2014/10/spreadsheet-error-costs-tibco-shareholders-100m/ How to producea tool with the flexibility of Excel and security of a (coded) software tool? Spreadsheet risk - A uniform cause of worry… this is our common fear… It may become quite costly…
- 25. ArgonPro consulting training 25 When everything hasbeen automated…
- 26. ArgonPro consulting training 26 ”Automation will increasespeed, efficiency and competitiveness.” ”Remember - All this should support the management and steering of Your organisation” ”Reliable and promptly delivered financial information will support high-quality decicion making ...” Then what… ”Traditional Finance and accounting will fade away…” ”… it will be raplaced by future oriented financial management.”
- 27. ArgonPro consulting training 27 When everything hasbeen automated… What is left is value adding human interaction… Manual/paperoffice Paperlessoffice Electronic Digital Automation and robotics (RPA) ”Intelligent finance” ”Future accounting”, forecasting Future oriented financial management Modelling and analysis Foresighting
- 28. ArgonPro consulting training 28 Already today thereis a need for finance people who ”speaks” (understands) IT …and vice versa The skills and talents needed will also change… ”Coder” ”Accountant” IT-dept. Finance 60’s ”Coder” ”Accountant” FinanceIT-dept. 90’s ”Multitalents” 2000 => ”firewall”
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- 30. ArgonPro consulting training 30 Outlook for thefuture When all routines has been automated… How to build processes and systems (software tools) focused to forecasting and future? Future oriented financial management! The amount and need for knowledge and information will grow exponentially How to pick up the relevant information from massive amount of data? And fast enough? In some businesses an hour (or day) may be too slow - in some businesses a month is ”fast enough” reporting period. Cybersecurity - not only IT department’s challenge Huge risks realising already every day Finance people needs more IT skills and IT people needs more finance skills Need for IT-Finance ”multitalents” Which one is more relevant or important - reporting history by the ”last decimal”, or focusing on forecasting and the future?
- 31. ArgonPro consulting training 31 The world, technologyand business models are changing… Finance and IT people must also change and adapt… What is needed is cost efficiency, new ways of thinking and new kind of talents…
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