The summer between my high school senior year and my freshman year of college, I was offered a job to make decent money sweeping floors for a machine shop business. This job paid three dollars more than the minimum wage at that time; it was not a night or a weekend job, so I jumped at the chance because it would enable me to save some money for my upcoming college expenses. During my three months of working on this summer job, I got to know quite a few of the machine workers there. All of them were hard-working and very proud of their skillset and the creations they had made.
Every machine worker had access to all the tools that they required to manually make machine parts for orders. For example, an order from a customer required a tailored cog to be made that had multiple holes drilled into it, with the exact hole size located in precise places that could not even be one centimeter off target. One of the best workers there was an experienced man named Earl who was in his early 60s, and nine out of 10 of his cogs were created perfectly. Earl was an expert at manually drilling each hole in the right spot. Everybody respected this man, and he was the floor manager’s favorite employee. But the best worker was a man in his late 20s, whose nickname was “Magic Mike.” Mike operated a computer/machine where he would type in coordinates into a computer, set the metal into the machine and let the machine do the precise automatic drilling for him. Mike was able to make four times the amount of cogs as Earl in the same amount of time, and Mike had zero errors.
One thing I noticed about Mike is that nobody would really talk to him during lunch breaks. I asked Earl about Mike, and Earl said, “People don’t like Mike too much because when they purchased the “Magic” machine that Mike uses, they laid off four employees. Earl told me that the machine was seen as a computer robot that is taking their jobs.
The wheel is often described as man’s greatest invention, even though the most important technology that really makes a wheel work is the axle. And without a doubt, at least one person said “technology is taking away jobs” when the wheelbarrow was invented. Just as we can acknowledge the fears that people have regarding new inventions and new technology, I want to acknowledge the fear in the workplace when it comes to Artificial Intelligence. Yes, you can use AI to replace jobs, but it is a matter of intent. AI is a tool, just as a drill is a tool, and just as a spreadsheet is a tool. The spreadsheet certainly displaced certain things that CPAs were doing, but it did not replace CPAs. But the spreadsheet possibly replaced the CPAs who refused to learn Excel, just as the “Magic Machine” eventually replaced some machine workers who refused to learn to program robot computers.
We are at a new age of revolutionary technologies, much like the early ’80s when personal computers started replacing mainframes. AI is upon us and it can allow us to increase the productivity of workers by creating great tools for them. Tools that increase worker productivity are the ones that save jobs.
When I was a child, I remember a time at the beach with my family when I built a giant sandcastle with shells and sand dollars, and I was very proud of it ... until I noticed the tide started coming in. So I quickly built a sand wall in front of my sandcastle and dug some trenches. And while my quick actions slowed the water for a little while, imminent destruction was inevitable, and eventually the water gushed in and demolished my creation. And just as trying to stop the tide from coming in, we cannot stop the wave of technology and AI. Whatever temporary measures you put in place at your job or your office to avoid AI, if it doesn’t happen in six months, it will eventually happen. We are always under pressure to improve worker productivity, or eventually a new person or a competitor will do it faster and cheaper. But if you manage to increase the productivity of the workers, then you will save jobs. By embracing technology, you have a chance to stay ahead in the industry, increase productivity and revenue per worker, or you risk going extinct.
New business technology is focused on creating functionality, but the problem is that humans have to spend time learning how to use that technology effectively, and this could take months or sometimes even years to ramp up. By using AI, you can actually increase the number of people who can adopt technology faster by making it easier to use technology. One extremely basic use of AI is to make things more human friendly so that humans don’t have such a steep learning curve. For example, new software at first did not come with wizards. Therefore, you had to open the software box, put the disk in, scratch your head and then maybe read a manual on how to set it up. Today, people expect and rely on an installation wizard to get started, where it holds your hand step-by-step asking questions, and gives you subtle hints on what you want to do.
Another example would be an application that tracks your expenses. AI can be used to accurately read receipts, detect duplicates and warn the user before submitting the expenses. Similarly, you can use this method in accounting. You will have workflows where you are looking for anomalies, and if the technology can help the person know what to pay attention to, that is a great tool and it will increase the productivity of the person. Ideally you wouldn’t see AI, you wouldn’t see a computer: you would see a natural workflow that cleverly uses AI to help the person achieve their business goals. You are not replacing the person, you are just making them more alert, helping them avoid pitfalls, and allowing them to effectively use their time to make their business partners and customers happier.
On the AI horizon for accountants and CPAs will be simple tools to handle fraud prevention, to create more accurate forecasting and definitely help reduce manual tasks to free-up valuable time. Imagine not having to manually go through receipts to apply expense categories and not having to check for duplicates and errors. Imagine not having to scramble the last few days and work weekends when it is time to do the monthly and quarterly close processes. By leveraging AI properly, you will soon be able to accurately process large sets of data in seconds that you would not have been able to produce with a team of data-crunchers assisting the CFO who does not have all of the time in the world. Also, Some accountants that I have worked with have mentioned to me that even with leveraging the latest software and apps, say that about 75 percent of their time is spent doing menial tasks such as data entry, categorizing and error checking, and this leaves only about 25 percent of their time for high-level strategic and executive-level tasks. So imagine if you could switch those percentages ... how much more efficient and valuable would you be to your company and clients? This is the future of AI, if you choose to embrace it.