We all peg a lot of our hopes and dreams — as well as our fears — on money. Both in our personal and professional lives, money isn't just about finance; it gives us flexibility, opportunity, possibilities, and power. Without it, our options are limited.
Yet there are so many complex factors that affect our finances at home and in business that mere mortals can't keep up with it all.
COVID-19 brought this vulnerability into sharper focus. The upheaval and ongoing effects of this global crisis didn't just affect us emotionally, our recent global study found that it changed our relationship with money — and it shook the trust we had in ourselves to manage money.
In fact, the survey found that 67% of people would trust robots more than humans to manage finances.
Specifically, 80% of business leaders said they would trust robots to manage their organization's finances, and 77% said they would trust a robot over their own finance teams. That should serve as a big wake-up call for finance departments across every geography and industry.
Growing comfort with Artificial Intelligence
The pandemic hit at a time when we had become increasingly comfortable with robots in our daily lives. Artificial Intelligence (AI) is something we have come to appreciate and even take for granted — from apps that navigate as we drive, to automated fraud alerts for our credit cards, we're accustomed to machines making our lives easier and more efficient.
So maybe we shouldn't be surprised that as financial anxiety and stress rose in 2020 — our research found that it doubled among consumers and increased more than 180% among business leaders — that the majority of people would now trust robots more than humans to manage finances.
The vast majority (90%) of business leaders surveyed said that they believe robots will replace financial teams in the future, and 56% believe it will happen in the next five years or it has already happened. There are a range of tasks that they trust robots with over their finance teams, including communicating with customers, negotiating discounts, and approving transactions. But more than 80% want help from robots for tasks like approvals, budgeting and forecasting, reporting, and compliance/risk management.
New buying habits and business models
In the past year, the pandemic has changed how we think about and use money in multiple ways. More than half of consumers (60%) said they have changed the way they buy goods and services, and almost three-quarters said the pandemic changed how they feel about handling cash. In fact, 29% said that a cash-only business transaction is a deal-breaker — they won't do it.
As a result, many businesses were quick to respond to shifting consumer behavior in 2020 with 69% of business leaders reporting their organizations have invested in new digital payments capabilities, or created new forms of customer engagement and business models (64%).
But it's not just about adapting to meet short-term changes to the market. The vast majority of business leaders (87%) believe that organizations that don't rethink finance processes will face risks, including falling behind competitors (44%), producing inaccurate reports (36%), having more stressed workers (36%) and reducing employee productivity (35%).
Currently, just more than half of organizations that were surveyed are using AI to manage financial processes. But that number rises quickly as AI capabilities become more embedded into finance technologies and business processes such as Cloud ERP systems.
Many companies are already moving toward this vision to better adapt to rapidly changing markets and to build the right foundation for the future. For example, Lyft is automating its financial close process with the goal of cutting the time taken to close its books from 12 days to 3 days. At Oracle, we're also on a journey towards a one-day financial close and have automated 75% of account reconciliations and 45% of manual accounting processes to close the books faster than any other company in the S&P 500.
Accelerating the financial close with automation means that finance teams have more time to work on future strategies rather than focusing on past performance. But the real benefit to companies will be the partnership of finance professionals with an ever-growing range of technologies that eliminates tedious tasks, detects patterns that mere mortals cannot, and provides real-time visibility into the business, so that they can all focus on what matters most, the customer.
For consumers, the way we manage finances will also change fundamentally. More than half of consumers (53%) trust robots more than themselves to manage finances; and 63% trust robots over personal financial advisors. This doesn't mean finance professionals are going away or being replaced entirely, but the research suggests they should focus on developing additional soft skills as their role evolves.