Tech Trends to WatchBy
As technology in management accounting changes rapidly, professionals must get out in front of that change to keep up and retain value.
David Colgren of the IMA® Technology Solutions and Practices (TS&P) Committee recently sat down for a Q&A session with Brad Monterio, IMA Global Board member and fellow TS&P member, to talk about technology trends for accountants. Brad recently delivered his global webcast, “Tech Trek 2020,” spotlighting technologies and strategies for accountants to consider for their roles and organizations.
DC: In what ways does technology provide accountants with a competitive advantage?
BM: Future management accountants are going to be “minted” with the right technology skills by the time they graduate college and enter the business world. This knowledge will put them on a level playing field with non-accountants. They can leverage their IT knowledge and skills as a competitive advantage if they keep abreast of technology trends and learn how to effectively integrate IT tools into their roles or functions. As far as current members of the profession go, we see a broad difference in level of IT knowledge and skills: Some are up to date; others require training. The IMA [Management Accounting] Competency Framework helps with their progress to fill knowledge gaps. Technology prowess is no longer a “nice to have” or “someone else’s responsibility.” It’s something the entire profession needs to embrace.
DC: How do you make the right technology choices for your organization?
BM: The rate of change in technology today is exponential. The future will only get faster. Faster, better, and cheaper technology solutions will always be there to distract you. Resist the temptation and the hype; this helps you avoid the trap of buying new technologies because “everyone else is doing it.” Not only can it be costly if you have to rip and replace systems, but it can expose your organization’s priceless data and systems to great risk. We’ve seen this phenomenon happen with blockchain. At one point, it seemed like every sector and industry was scrambling to implement blockchain in their businesses. Many tried. Many spent a lot of money. Many didn’t end up with workable solutions. The point is: Understand your business needs and then match the IT solutions to your needs.
DC: What are some of the important technology trends the accounting profession needs to watch?
BM: IMA regularly features trends in the latest stories and webinars in its new Technology & Analytics Center. The trends I am highlighting here have numerous applications across business, including in accounting and finance roles.
Digital trust. As businesses and consumers alike become savvier about how organizations are using their confidential and personal data, a crisis of trust has emerged. AI and machine learning are increasingly being used to drive business decisions, but companies are on the hook to explain how their AI works in plain language we can understand. They need to be transparent about their data and privacy policies. Trust can take decades to build and only seconds to destroy, so companies need to ensure that their audiences feel safe in doing business with them. Gartner predicted that, by the end of 2020, companies that are digitally trustworthy will be generating 20% more online profit than those that aren’t. There must be trust in finance and accounting information, reports, and disclosures. AI and machine learning tools can be used to provide things like continuous monitoring and controls, free from sick days and distractions.
Human augmentation. This is an area focused on the use of technology to increase someone’s cognitive and physical experiences. We’ve been augmenting ourselves for a long time with things like prosthetic limbs and eyeglasses because they improve the quality of life. So this isn’t a new idea. The more applicable augmentation is cognitive in nature and enhances our ability to think and make better decisions. This could include exploiting information and applications to enhance learning or new experiences, augmenting human intelligence with artificial intelligence, and even implants inside our bodies to improve our cognitive reasoning. Cobots (or collaborative robots) may be running RPA [robotic process automation] in accounting and finance functions, but augmented humans aren’t that far away from making even quicker strategic decisions.
Empowered edge computing. This is all about using resources at the edge of a network, much nearer to the sources and consumers through which data is exchanged, as seen often with the Internet of Things (IoT). With this trend, information processing, collection, and delivery resources are placed much closer to the sources of the information, such as a mobile device, with the idea that keeping information traffic more local will reduce latency. In business, time is money, and every bit of latency shaved in information sharing means decisions get made more quickly. Accounting and finance functions for supply chains and multilocation companies will benefit from this trend.
Autonomous things. In this domain, physical devices use AI to automate functions previously performed by humans. They range in size and sophistication from small drones to large ocean freighters, and they operate on land and sea and in the air. Autonomous things are often operating inside warehouses and manufacturing facilities. They typically operate from totally independent at one end of the spectrum to a hive or swarm group on the other end that operates collaboratively, intelligently, and with a purpose. This could include remote auditing programs or surveillance or facilities, spatial data, or remote sensing.
AI security. Greater use of AI solutions increases the number of potential cyber vulnerabilities, such as through IoT devices or mobile/remote sensors. They connect to vital systems, transport vital data, are critical assets to the business, and must be protected at all costs. AI training data and algorithms must be shielded from attack so they can fulfill their intended roles. Through 2022, Gartner estimates a significant percentage of all AI cyberattacks will attempt to poison training data, steal AI models, or compromise AI-powered systems. These systems will certainly be integrated with accounting and finance functions that also require solid security protections.
DC: What advice do you have for management accountants with respect to technology?
BM: Accountants always need to have one eye focused on the future to understand what’s changing in the profession globally and locally. They need to get out in front of changes in business by raising their technical and technological knowledge in order to meet the challenges of an evolving profession head on. This means identifying gaps in their competencies and getting the training to fill the gaps and become expert-level professionals. Technology will always be part of the solution and will give accountants an advantage over others, both human and robotic. Embrace these changes and use technology to your advantage. Don’t shrink from it, fear it, or think it won’t impact you. Leverage new technologies in accounting and finance to help you be more efficient and effective, making you more valued in the end.