Practical Use Cases of GenAI - In Finance

GenAI has been the buzzword for more than a year now and we started with the questions Why and What. Why would we utilize the power of GenAI, why do I care as a professional, and what it is really, what is it good at and what it is not good at.

We have shifted this paradigm to what is HOW of the GenAI. How will GenAI impact the business and its functions, how will I stay ahead of my competition by adopting GenAI and leveraging its capabilities.

If I talk about the finance function in an organization, what are the real use cases that will impact this department. What are the moves I make today that will set me up to realize ROI in the next year or so.

As we started envisaging the benefits of GenAI we realize that the ROI expectations are huge and at the same time people are wary of investments. There are many concerns about the accuracy, ethical results and adapting to the new style of working. The obvious impact of GenAI is on time savings, efficiency, accuracy, speed, quality and stakeholder experience.

I can mention some of the use cases of the Finance Functions that have used GenAI to their potential:

1. MD&A (Management Discussion & Analysis): MD&A requires analysis of current and historic numeric information. GenAI can be utilized to help perform this function. Currently finance executives are performing very time consuming and manual process to provide current finance updates to the leadership. We can create a GenAI tool that ingests reports and other financial data to create easy to digest summaries. These summaries can be provided around revenue, impact to budget and staff utilization etc. This GenAI tool can be used widely by the finance professionals. GenAI can look at the numbers and data for days and years and look at the anomalies and summaries. It can analyze data, summarize the data and create memos.
2. Vendor Contracts: The Procurement Team manages the drafting of thousands of vendor contracts annually, a process characterized by repetition and time consumption. Many contracts feature unique aspects requiring custom language. To address this challenge, GenAI tools can be developed to streamline the process. These tools ingest uploaded files such as quotes, order forms, and supplier proposals, enabling users to efficiently navigate diverse information. They recognize the need for custom clauses and compliance requirements, generating draft contracts and summarizing terms and conditions within seconds. By utilizing these tools, finance professionals can enhance their strategic focus on contract negotiations, leading to increased efficiency. Additionally, these tools provide essential information for accurate contract accounting and milestone tracking.
3. Travel Policy: The travel policy exists, but it's apparent that it's not effectively accessed or utilized. To address this challenge and enhance the relevance of finance and policies for those who seek adherence, GenAI tools can be developed. Specifically, a chat bot system could be implemented, allowing employees to inquire about specific aspects of the travel policy, such as the eligibility to book certain types of tickets or hotel rooms. This chat bot serves as a user-friendly interface, providing immediate answers to queries and fostering greater awareness and compliance with the travel policy among employees.

Gen AI presents an invaluable opportunity to extract critical insights and facilitate queries from various contract types, including Customer Contracts, Supplier Contracts, Leases, and Partnership Agreements. Furthermore, it aids in new content creation, conducts data analysis, and generates summaries or commentary through thorough analysis. This multifaceted tool also streamlines monthly flash reporting and automates tasks across departments, including helpdesk functions for customer-facing interactions, investor relations, and market research endeavors.

Moreover, GenAI plays a pivotal role in data augmentation, test data creation, and portfolio functions. Its dual capability of extracting and summarizing existing data while also generating new content underscores the paramount importance of responsible AI implementation.

Ultimately, the impact of GenAI transcends organizational boundaries, influencing every department and function within an organization.

In the foreseeable future, the finance function is poised to undergo significant evolution, with several key transformations anticipated:

1. Enhanced Business Insights: Finance will play a pivotal role in providing deeper insights to the business. Leveraging Natural Language Processing (NLP), it will generate queries and analyze data to offer actionable insights, thereby empowering executives with superpowers to make informed decisions.
2. Automation of Transactional Processes: Transactional tasks within finance will be largely automated, allowing finance professionals to focus on higher-value strategic activities.
3. Effortless Utilization of Advanced Technology: Finance teams will seamlessly utilize complex technologies, making processes more efficient and effective.
4. Advanced Financial Reporting & Analysis (FR&A): There will be a shift towards more accurate forecasting and predictive analytics, informed by historical and market trends. Finance will provide valuable guidance to investors, underpinned by robust governance frameworks such as Robotic Process Automation (RPA).
5. Transformation of Business Intelligence Tools: Traditional static business intelligence tools and dashboards will become obsolete, replaced by dynamic, real-time analytics platforms that offer deeper insights and facilitate better decision-making.

Measuring the Return on Investment (ROI) of GenAI involves assessing various factors:

1. Empowerment of People: Evaluate how GenAI empowers individuals within the organization to perform tasks more efficiently and effectively, leading to improved productivity and job satisfaction.
2. Financial Impact (P&L Savings): Analyze the financial impact of GenAI implementation, including cost savings from reduced manual labor, increased efficiency, and optimized resource utilization.
3. Automation of Manual Tasks: Measure the extent to which GenAI automates manual tasks, reducing human intervention and associated costs while enhancing accuracy and speed.
4. Bringing Offshore Operations In-house: Assess the feasibility and cost-effectiveness of bringing offshore operations in-house through the implementation of GenAI solutions.
5. Time and Energy Savings: Quantify the time and energy saved by employees through the automation and optimization of processes enabled by GenAI.
6. Expansion with Limited Resources: Evaluate how GenAI enables organizations to expand their operations and scale their business with the same level of resources, maximizing efficiency and profitability.
7. Transition from Manual to AI and Automation: Track the transition from manual processes to AI and automation-enabled workflows, measuring improvements in speed, accuracy, and cost-effectiveness.
8. Addressing Job Concerns and Skill Development: Address concerns regarding job displacement by highlighting the importance of learning GenAI technology and upskilling to remain relevant in the evolving workforce landscape.
9. Digital Transformation and Workforce Evolution: Position GenAI implementation within the broader context of digital transformation and workforce evolution, emphasizing its role in driving innovation and competitiveness.
10. Expectations from Service Providers: Assess the expectations from cloud service providers, CRM vendors, and email vendors to incorporate GenAI capabilities into their offerings, facilitating seamless integration and enhanced functionality for end-users.

In summary, the finance function of the future will be characterized by its ability to provide comprehensive insights, automate transactional processes, leverage advanced technologies effortlessly, deliver accurate forecasting and predictive analytics, and adopt transformative governance models, ultimately driving strategic value for organizations.