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Why Finance professionals need to know about AI—and where they can learn

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Why Finance professionals need to know about AI—and where they can learn


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In case you haven’t noticed, artificial intelligence (AI) is getting a lot of press these days. From the development of self-driving cars to lesion diagnostics for skin cancer,1 AI in its many forms is generating attention.  It’s inciting more and more questions from the business community. Those questions are even coming up on corporate earnings calls.

A story in the October 23, 2017 issue of Bloomberg Businessweek reported that, “the term ‘artificial intelligence’ came up during 363 earnings calls and investor presentations in the third quarter, more than triple the number from the same period last year.” 2 Businessweek also noted that “only half of the companies talking about AI are in the tech industry.” It would seem then, that companies interested artificial intelligence are just as numerous as those interested in developing it. And at this point we hasten to add that those earnings call questions were about AI and not from AI.

Artificial intelligence to digest Big Data

Whether or not you get an AI question on your next earnings call, developments in AI deserve the attention of finance professionals for at least two reasons. First, these intelligent computing capabilities offer great promise to the finance function itself. Just as advanced analytics are already increasing speed and accuracy in areas like multidimensional analysis and scenario modeling, AI applications promise to enable finance professionals to draw insights from the enormous quantities of structured and unstructured data that companies are now collecting, leading to smarter, faster decision making.

A Special Report in the November 2017 issue of CFO magazine observed that, “In the future, CFOs should expect to find more FP&A (financial planning and analysis) applications that take better advantage of the massive amounts of virtually free data that have become available from many sources.” 3 CFO recommended that “Finance chiefs should also look for applications with machine learning capabilities—where the software gets ‘smarter’ as it observes humans operating it—and even artificial intelligence features.”

IBM’s own Ginni Rometty touched on this subject in the September 25, 2017 issue of Bloomberg Businessweek. She said that improving decision making amid the exponential growth in data volumes has always been a primary goal in the development of AI. “When we started over a decade ago,” she said, “the idea was to help you and I make better decisions amid cognitive overload.” 4

Which brings us to the second, and perhaps more important reason that finance people should get acquainted with AI. Finance leaders are increasingly being asked to weigh in on the business value of AI software and the advisability of funding investments in AI. In many companies, AI is already playing an important role in the areas of governance, risk and compliance. Its use there is expected to expand. AI also offers competitive advantage with cost savings and efficiencies across a range of business functions. AI can also find new ways to improve the quality of both products and services.

A rose by any other name

It’s worth mentioning here that there is some overlap in the terminology used to describe the different concepts and capabilities related to artificial intelligence. Terms like “natural language processing,” “machine learning” and “cognitive computing” are sometimes used interchangeably. For that reason, industry efforts are underway to standardize the definitions and create a universal classification of related terminology. Regardless, every day brings new, more sophisticated and intelligent apps for your smartphone. The power and complexity of AI or AI-like business applications will only continue to grow.

 

AI Venn Diagram – one take on classification of AI and related terminology according to the Big Data Dictionary

Sooner than you think

Could AI applications create new opportunities for your company? Could AI help you discover new ways to operate more efficiently? Probably. And sooner than you think. To prepare for the business environment of that fast-approaching AI future, register for IBM’s Think 2018 conference. It will be held March 19-22, 2018 in Las Vegas and AI will be a major focus of the event. The curriculum also invites you to “Explore the technologies that are making waves across industries.” So you can learn what IBM technology is doing for your specific industry, whether it’s Automotive, Banking, Government, Healthcare, Manufacturing, Telecom or many others.

Visit the conference website to learn more

 

 

1 “Man vs. Machine—Dermatology,” Bloomberg Businessweek, July 3, 2017

2 Michael McDonough, “Charted: Corporate AI Chatter,” Bloomberg Businessweek, October 23, 2017

3 Keith Button, “Let the Fun Begin,” CFO, November 2017

4 Megan Murphy, “Debrief: Ginni Rometty,” Bloomberg Businessweek, September 25, 2017

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