A.I. and machine learning are about to have a breakout moment in finance

There’s been a lot of discussion on the use of artificial intelligence and the future of work. Will it replace workers? Will human creativity be usurped by bots? How will A.I. be incorporated into the finance function? These are just some of the questions organizations will face. 

I asked Sayan Chakraborty, copresident at Workday (sponsor of CFO Daily), who also leads the product and technology organization, for his perspective on a balance between tech and human capabilities. 

“Workday’s approach to A.I. and machine learning (ML) is to enhance people, not replace them,” Chakraborty tells me. “Our approach ensures humans can effectively harness A.I. by intelligently applying automation and providing supporting information and recommendations—while keeping humans in control of all decisions. He continues, “We believe that technology and people, working together, can allow businesses to strengthen competitive advantage, be more responsive to customers, deliver greater economic and social value, and generate more meaning and purpose for individuals in their work.”

Workday, a provider of enterprise cloud applications for finance and HR, has been building and delivering A.I. and ML to customers for nearly a decade, according to Chakraborty. He holds a seat on the National Artificial Intelligence Advisory Committee (NAIAC), which advises the White House on policy issues related to A.I. (And as much as I pressed, Chakraborty is not at liberty to discuss NAIAC efforts or speak for the committee, he says.) But he did share that generative A.I. “continues to be a growing part of policy discussions both in the U.S. and in Europe, which has embraced a risk-based approach to A.I. governance.”   

Tech’s future in finance

Chakraborty’s Workday colleague Terrance Wampler, group general manager for the Office of the CFO at Workday, has further thoughts on how A.I. will impact finance. “If you can automate transaction processes, that means you reduce risk because you reduce manual intervention,” Wampler says. Finance chiefs are also looking for the technology to help in accelerating data-based decision-making and recommendations for the company, as well as play a role in training people with new skills, he says.  

Consulting firm Gartner recently made three predictions on financial planning and analysis (FP&A) and controller functions and the use of technology: 

– By 2025, 70% of organizations will use data-lineage-enabling technologies including graph analytics, ML, A.I., and blockchain as critical components of their semantic modeling.

– By 2027, 90% of descriptive and diagnostic analytics in finance will be fully automated.

– By 2028, 50% of organizations will have replaced time-consuming bottom-up forecasting approaches with A.I.

Workday thinks about and implements A.I. and ML differently than other enterprise software companies, Wampler says. I asked him to explain. Enterprise resource planning (ERP) is a type of software that companies use to manage day-to-day business activities like accounting and procurement. What makes Workday’s ERP for finance and HR different is A.I. and ML are embedded into the platform, he says. So, it’s not like the ERP is just using an A.I. or ML program. It is actually an A.I. and ML construct. And having ML built into the foundation of the system means there’s a quicker adaptation of new ML applications when they’re added. For example, Workday Financial Management allows for faster automation of high-volume transactions, he says.

ML gets better the more you use it, and Workday has over 60 million users representing about 442 billion transactions a year, according to the company. So ML improves at a faster rate. The platform also allows you to use A.I. predictively. Let’s say an FP&A team has its budget for the year. Using ML, they predictively identify reasons why they would meet that budget, he says. And Workday works on a single cloud-based database for both HR and financials. You have all the information in one place. For quite some time, the company has been using large language models, the technology that has enabled generative A.I., Wampler says. Workday will continue to look into use cases where generative A.I. can add value, he says.

It will definitely be interesting to have a front-row seat as technology in the finance function continues to evolve over the next decade.

Sheryl Estrada
sheryl.estrada@fortune.com

Upcoming event: The next Fortune Emerging CFO virtual event, “Addressing the Talent Gap with Advanced Technologies,” presented in partnership with Workday (a CFO Daily sponsor), will take place from 11 a.m.-12 p.m. EST on April 12. Matt Heimer, executive editor of features at Fortune, and I will be joined by Katie Rooney, CFO at Alight Solutions; and Andrew McAfee, cofounder and codirector of MIT’s Initiative on the Digital Economy and principal research scientist at MIT Sloan School of Management. Click here to learn more and register.

Big deal

“The race to cloud: Reaching the inflection point to long-sought value,” a report by Accenture, finds that over the past two years, there’s been a surge in cloud commitment, with more than 86% of companies reporting an increase in cloud initiatives. To gauge how companies today are approaching the cloud, Accenture asked them to describe the current state of their cloud journeys. Sixty-eight percent said they still consider their cloud journeys incomplete. About a third of respondents (32%) see their cloud journeys as complete and are satisfied with their abilities to meet current business goals. However, 41% acknowledge their cloud journeys are ongoing and continue to evolve to meet changing business needs. The findings are based on a global survey of 800 business and IT leaders in a variety of industries.

Going deeper

“The workforce well-being imperative,” a new report by Deloitte, explores three factors that have a prominent impact on well-being in today’s work environment: leadership behaviors at all levels, from a direct supervisor to the C-suite; how the organization and jobs are designed; and the ways of working across organizational levels. Deloitte refers to these as “work determinants of well-being.”

Leaderboard

Lance Tucker was promoted to CFO at Papa John’s International, Inc. (Nasdaq: PZZA). Tucker succeeds David Flanery, who will retire from Papa John’s after 16 years with the company. Flanery will continue at the company through May, during a transition period. Tucker, 42, has served as Papa John’s SVP of strategic planning and chief of staff since 2010. He has 20 years of finance and management experience, including previously serving in manager and director of finance roles at Papa John’s from 1994 to 1999. Before Papa John’s, Tucker was CFO of Evergreen Real Estate, LLC.

Narayan Menon was named CFO at Matillion, a data productivity cloud company. Menon brings over 25 years of experience in finance and operations. Most recently, Menon served as CFO of Vimeo Inc., where he helped raise multiple rounds of funding and took the company public in 2021. He’s also held senior executive roles at Prezi, Intuit, and Microsoft. Menon also served as an advisory board member for the Rutgers University Big Data program.

Overheard

“This was a bank that was an outlier.”

—Federal Reserve Chair Jerome Powell said of Silicon Valley Bank in a press conference following a Fed decision to hike interest rates 0.25%, Yahoo Finance reported. Powell referred to the bank’s high percentage of uninsured deposits and its large investment in bonds with longer durations. “These are not weaknesses that are there at all broadly through the banking system,” he said.

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