boosting revenue and profit with new automation technologies.
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with david bergstein
as we move from manual, to digital, to everything automated, bots are becoming an important part of how we transition from compliance services to high-value advisory services.
in this episode: it pays to know your bots.
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transcript
dave bergstein: good day. today’s question is what’s a bot? a lot of people have been talking about bots in the accounting profession. as we move from manual to digital to everything automated, bots becoming an important part of how we increase our efficiency. the question is, what’s a bot? we got good bots and we have bad bots. really, a bot is a software application that is programmed to do certain tasks. bots are automated, which means they run according to their instructions without a human user needing to start them up. bots often imitate or replace a human user’s behavior. bots do repetitive tasks well. you set up the structure and they can do them much faster than humans could.
let’s just take a couple of examples of what a bot can do. let’s take, for instance, you receive an email that contains an invoice. if you’re a human, you would take it out of the envelope, you would look at it, and then you would enter the data into an accounting or bookkeeping system. bots that are automated can extract the data and then type that information into an accounting or bookkeeping system. we see that with quickbooks and xero and netsuite. there are applications that automatically take the information when an email comes in and puts it into the accounting system.
bots save us time. they take over repetitive tasks that employees carry out 50, 60 times a day, and automate the function, make it easier for us to do things, and again, saves us time. this slide shows a number of examples of what i’ll call rpa in action, robotic process automation. we’ve set up the bots to process automatically different things like taking periodic reporting data entry and putting it into information so we can do data analysis. a mass email extractions or archiving and extracting. again, everything is here to save us time.
as we look towards the future of accounting, the future of accounting is letting the lower value services be done via automation and bots, and us as accountants doing the high-level work, which is advisory services to our clients. even though clients say they come to the accountant to actually turned on their payroll tax, sales tax, bank recs, financial statements, they really come to us as the experts to help them be more liquid, solvent, and profitable. they want us to help them be better in running their business. they know what their business is about. they don’t want to be working in the business, they want to be working on the business.
through our advisory services, we can help them and through our utilization of automation and bots, because i truly believe we’re going to take more and more of what we do from the journal entry to the posting to the ledger to the trial balance to the worksheet to real-time accounting information, we’re going to let automation take that so that we can help our clients with other things. right now, we use a lot of apps in relation to helping our clients perform their tasks. bots which is similar to apps maybe can do a lot more because they’re learning a lot more, make it easier.
a good example, i use an app to turn on the lights in the house. i went from that to now i have a bot, alexa. when i walk in the house, i say, “alexa, please turn on the lights.” that’s an example of replacing an app with a bot. i think bots are in our future. as we move future-forward, it’s all about automation and artificial intelligence. ai is the science of training machines to perform human tasks. ai holds the concept that a computer can act like a human brain, calculating the road around us every second of every day. sounds like i’m driving a self-driving automobile.
artificial intelligence includes reasoning, cognitive processing, natural language recognition, planning, and other research fields in addition to machine learning because we can’t have artificial intelligence, in my opinion, without machine learning because machine learning is the field of science that explores the development of algorithms that can learn from and make predictions on data. the main difference with other common algorithms is the learning piece.
machine learning algorithms are not a series of processes serially executed to produce the desired result. they are instead a series of processes aiming to learn patterns from past events and build functions that can produce good predictions with a degree of confidence. i see that as an example in the accounts payable field, where machine learning has come into play on artificial intelligence to make it easier for paying bills. as we move forward, to me, it’s all about automation. we let bots perform a variety of repetitive finance tasks.
again, as i said, when i think of accounts payable process from manually to automate it, i actually think of a company called vic.ai, which makes it easier and reduces the amount of time it takes you to process your payables. what does it get us if we let bots take over and we automate the process? it allows us to work more accurately. bots always follow the rules and don’t make any errors. automation will significantly reduce the error margin. we’ll gain productivity. software robots perform time-consuming repetitive tasks rapidly. one thing, we’re not paying overtime, they’re available 24/7.
we’ll be able to boost compliance. every test that a bot performs is traceable, which means we have an audit trail if we have to look back. we automate, we can cut costs, we can improve productivity and the few errors will help us lower our costs. moreover, the roi on rpa is fast as we write the routine or you bring somebody else in. i’m not an expert on writing the routines, i know what i want done. i have associates that are experts in data analytics and in computer programming. i tell them what needs to be done, and they write the api to perform the robotic process automation over and over again.
with this, we’ll gain an edge. by automating a process, we can reassign personnel. i don’t have to do the task. i don’t have to delegate them to someone in my firm to enter data and sort through information. the bot’s doing it. then we can spend more time dealing with our clients, advising them, and building better relationships. to me, the future is all about utilizing all the different levels of automation. when i think about all the transitions and technological revolutions we’ve had in accounting, and it started with the quill. i like to use bob cratchit as my example, working on two books through a comptometer, through an adding machine to a computer to a bot to artificial intelligence.
think about excel and what excel did working with spreadsheets. today, bots are increasingly gaining a foothold in the accounting profession. in the coming years, the level of intelligence is expected to rise dramatically. rpa or robotic process automation leverages the computing power of software to automate high volume, error-prone, repeatable tasks. at this stage, software bots mimic human activity. they are not intelligent on their own. machine learning involves a first level of computer intelligence. bots managed to make predictions based on patterns and correlations in large amounts of data.
cognitive computing systems try to simulate human thought with the aim of making high-level decisions in complex situations. then we have artificial intelligence, systems and real intelligence, the machines. the bots learn the variables they should pay attention to from humans to then take decisions, make decisions, and give orders on their own. how far they go, that’s the futuristic end of it.
when we look at these trends that i’m talking about and we look at what’s a bot, and we understand that bots are really automating functions taking advantage of machine learning and producing more desired results. as the machine gets smarter, artificial intelligence allows the bot to make decisions based on the information that’s been gathered. we look at the trends that cpa.com puts out every year. cpa.com is the marketing arm of the aicpa.
this was their megatrends for 2020. it goes with what i’m talking about with what’s a bot because there’s a lot of stuff or a lot of information in here that relate to bots. smart robots, augmented intelligence, conversational ai, machine learning, rpa. everything that we talked about seems to be let’s put it in the cloud because the cloud connects everything and we have the internet of things moving up and down the channel.
i hope i’ve answered the question of what’s a bot and why it’s needed. if you have any further questions, feel free to reach out. we’re here to help. dave bergstein is the name. it’s all about accounting and automation is what i’m looking for.
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