CFOs bolster finance teams with automation: Blue dot

CFOs are beginning to take fuller responsibility for digital transformation initiatives at their organizations, meaning financial leaders are taking closer looks both at the role of automation in their finance functions and the talent required to use such technologies effectively.

Using automation to help cut down costs is especially intriguing for financial leaders in the current economic environment where they continue to face headwinds, including from inflation as well as talent retention.

Rather than using automation to reduce headcount, a functional partnership between the two can help CFOs to create further value at their organizations, said David Guedalia, chief technology officer for AI tax compliance software provider Blue dot Corp.

“There’s definitely a push to reduce costs — there’s always a push to be more efficient,” Guedalia said. This could include a CFO seeking to replace headcount with automation, he said. Yet, Guedalia also pointed to Blue Dot customers who had “kept the same manpower” while integrating automation, enabling them to better pinpoint and utilize high-value data at their businesses.

“So you don’t reduce headcount, but you increase the value that headcount is producing,” Guedalia said in an interview.

Making best use of automation

Automation’s draw is partly as a cost-cutting tool — it can enable business and financial leaders to better parse through expanding amounts of data, leaving one’s employees free to tackle more complex tasks while automation handles more routine, manual work.

“You may now free up people to look at the data you have that can provide more value to your company,” Guedalia said. “And my expectation is that automation and digitization and AI only increase the amount of work we have to do, but it’s much more high-value work.”

Using automation as a value-add for one’s employees also means CFOs need to have talent available within their finance departments that can understand how to best utilize the technology. It is also important for financial leaders to take steps to educate themselves when it comes to such technologies’ fundamentals, Guedalia said.

CFOs don’t need to be aware of how automation or emerging technologies work under the surface, just like they don’t need to know how familiar tools like Excel are coded. However, if they are “not aware of some of the fundamentals of how automation and machine learning, in particular, are designed, then there are pitfalls that they could fall into,” Guedalia said.

“The big shift here in thinking is from having a set of expectations in your financial data, to listening to the data itself,” he said. “Letting it describe to you what it thinks is interesting.”

The importance of digital, tech talent

Putting more emphasis on digital skills can also help financial leaders more easily implement automation. One of the top challenges when in utilizing automation lies in letting go of previous habits or “preconceived notions of how things should work” with the new tool, Guedalia said.

“You have to be open to walk away from the way you did things traditionally and be open to look at things differently,” he said.

Another challenge for financial and executive leaders as they shift to automation is in understanding automated tools are not typically “sensitive to changes in environment,” Guedalia said.

“That’s going to be the biggest pitfall of shifting over to an automated environment,” he said. “Whatever bad behavior you have becomes enshrined forevermore — and they may have been good behaviors last year, and now they’re not.”

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