According to a survey by PWC, Accounting topped the list of professions at risk of automation with 97.5% probability. We repeat 97.5% probability! And it’s already happening. Companies have reduced the number of full-time employees per $1 billion of revenue with 40% from 2004 to 2014. Processes are becoming automated yet still, people are employed in Finance and even jobs like AP clerk (991 listings on LinkedIn, July 2017) and AR clerk (508 listings on LinkedIn, July 2017) haven’t disappeared completely yet.
However, there are no reasons to believe that the current trend will stop and further automation will cease. The logic is quite simple as much of accounting is rules-based hence it’s simple to program software with rules covering 95-99% of all transactions. When the input is then also received automatically via a scan from a vendor or what to bill the client directly from the operational system there’s no argument left as to why human intervention is needed.
It’s a tough message though and one that’s hard for people to accept. Yet, it’s a normal part of the change curve that people go through when they must face the music.
Finance management in most companies have long committed to this change but down the ranks, there’s still a lot of anger while only a few are still caught in denial. The real question is what to do when many accountants hit resignation. Will they accept and commit to a new reality where they’ll have to learn new skills such as analytics and communication or will they get in the back of the line of all the industrial workers laid off because of the Financial Crisis?
This discussion is much broader than finance and accounting, of course. Here we’re talking about the future of work which is not the topic of this book. All we know is that if you’re an accountant of the old school you need to find something more value adding to contribute to than pure accounting. You can specialize in technical accounting, tax and so on or become a generalist who as a consultant can advise the business on how to optimize the bottom-line whether through more revenue or cost savings. At least we’re still somewhat far removed from robots taking over that part!
We’ve seen how automation can boost productivity and fuel growth without adding additional staff, how cloud software can make the life easier for everyone in the company exposed to financial transactions and how offshoring leaves people in the thousands without a job. Robotics and, in this case, software will only continue to affect the future of accounting so what’s your action plan? How will you ensure that you’re still employed five or ten years from now?