Companies Harness Generative AI to Streamline Finance Operations and Unlock Strategic Growth

Generative AI Transforms Finance Function, Freeing Up Capacity for Strategic Work In a bid to optimize financial operations amidst ongoing uncertainty, companies are increasingly turning to generative artificial intelligence (AI) tools. These innovative technologies have the potential to revolutionize the finance function by automating mundane tasks and freeing up time for more strategic work. According to Andrew W. Lo, Charles E. and Susan T. Harris professor and director of the Laboratory for Financial Engineering at the MIT Sloan School of Management, large language models (LLMs) and generative AI tools can significantly support everyday tasks such as generating quarterly reports, communicating with investors, and formulating strategic summaries. "Generative AI is not meant to replace the chief financial officer," Lo emphasized. "Rather, it's designed to take a lot of the drudgery out of the role by providing first drafts of documents that summarize key issues and outline strategic priorities." The use of generative AI in finance has already shown promise in areas such as treasury management. Companies are leveraging these tools for cash, revenue, and liquidity forecasting, among other applications. Background research suggests that the finance function has traditionally been bogged down by manual tasks, leaving little time for high-value activities like strategic planning and advisory work. With generative AI, chief financial officers (CFOs) can now focus on providing proactive guidance to their organizations as they navigate complex geopolitical and financial landscapes. Industry experts point out that while generative AI is not a panacea for the finance function's challenges, it does offer a significant opportunity for improvement. By automating routine tasks, companies can redirect resources towards more critical areas of business operations. As the use of generative AI in finance continues to evolve, stakeholders are keeping a close eye on its implications for society as a whole. With the potential to enhance efficiency and productivity, these technologies also raise important questions about job displacement and the future of work. The latest developments indicate that companies are increasingly embracing generative AI as a means to stay ahead of the curve in an uncertain business environment. As this trend continues to unfold, it will be essential for organizations to carefully consider the opportunities and challenges presented by these innovative technologies. Sources: Deloitte Andrew W. Lo, Charles E. and Susan T. Harris professor and director of the Laboratory for Financial Engineering at the MIT Sloan School of Management Note: This article is based on a sponsored report from Deloitte in association with. *Reporting by Technologyreview.*