What exactly is Artificial Intelligence (AI), especially as it relates to the world of Accounts Payable (“AP”) and Finance? Today, AI seems to be a ‘catch-all’ term used to lump together so many different things having to do with automation. In far too many conversations I’ve had, and in articles I’ve read, Robotic Process Automation (RPA), Machine Learning (ML), and AI are used almost interchangeably when in fact they are very distinct technologies. Some of the confusion surrounding the topic is due to the fact that AI is not any one technology. Rather, it is an ecosystem of interconnected smart technologies and innovations that, when combined, represent a whole that is greater than the sum of its parts – one that augments knowledge workers in AP and Finance for instance, rather than replacing them.
Interestingly, the Oxford Dictionary defines it this way: “AI is the theory and development of computer systems able to perform tasks normally requiring human intelligence, such as visual perception, speech recognition, decision-making, and translation between languages. However, AI is evolving rapidly, as is the understanding and definition of the term.” It’s not often that the Oxford Dictionary, or any dictionary for that matter, includes a caveat when providing a definition of a word. Basically, they are admitting that how AI is defined today may not be how it will be defined in the future.
Let’s take a closer look at Artificial Intelligence and how it can be leveraged in AP. Before we begin, let’s make sure we are all on equal footing for the purpose of this discussion. RPA is not Artificial Intelligence, Machine Learning is not Robotic Process Automation, and Machine Learning is not Artificial Intelligence. However, a natural extension of machine learning is Artificial Intelligence (AI), which leverages algorithms and tools that can ultimately make an AP operation smarter by processing and understanding cause and effect without human interface.
When most solution providers use the term, Artificial Intelligence, they use it to describe data-driven process automation, analysis and reporting, and task execution that is performed in a seemingly autonomous manner and with a decidedly humanistic flair. But pull back the thin veneer cloaking the technology, and the mysteries of AI become less mysterious. At its heart are deterministic or search-based algorithms, written and tweaked by data scientists that crunch and decipher enormous amounts of structured and unstructured data in seconds, or fractions of a second. Data outputs, like user patterns and probabilistic determinations, are used to drive process automation and task execution.
Today, Machine Learning that is powered by Big Data and advanced algorithms is beginning to unlock value for many leading enterprises across a broad range of business functions. But AI is distinct from Machine Learning in that a solution with a functional AI capability does not require human input beyond the initial programing phase. Instead it uses algorithms and internal rules to independently make decisions. AI has great applicability when it comes to AP as it can provide value in terms of invoice processing and payment approval/scheduling. A solution with embedded AI could receive and process an invoice based on in-built rules, which includes recognizing appropriate data fields, query a database prior to scheduling payment to see what payment type the referenced supplier prefers, and also offer varying payment discount options that optimize cash flow for an enterprise.
Invoice exceptions are the scourge of every AP department. AI has great potential to avoid many of the exception issues by preemptively identifying problem invoices and the suppliers most likely to submit them. From an analytics perspective, AI could automatically collect, cleanse, and serve up financial and operational intelligence that could be used to make more strategic decisions. In essence, AI could free AP from tactical tasks and allow the function to emphasize more advanced capabilities.
Conclusion
It is obvious why so much attention these days is being paid to AI. This technology (or collection of technologies as it were) has the potential to change the world, and we are currently only scratching the surface in terms of how it will affect not only AP and Finance, but also our entire lives. Mark Cuban, American businessman, owner of the National Basketball Association’s Dallas Mavericks, and an ‘original shark’ on the hit TV show ‘Shark Tank’ has this to say about AI – “I am telling you, the world’s first trillionaires are going to come from somebody who masters AI and all its derivatives, and applies it in ways we never thought of.” Artificial Intelligence is making business users smarter, more nimble, and more efficient. It provides AP with a great opportunity to transform the function from the tactical one most of us are familiar with today, to a more strategic, value-adding operation of the (not to distant) future.
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