Archives For IMA

social technologies

By Warner Johnston, head of ACCA USA

People have been using computer-based networks for decades to create, share and exchange information and ideas. The rise of social media was driven by people, not organisations. Historically, IT innovation was driven by big business and the military, but blogging, instant messaging, and sites for sharing pictures and music have become established as popular personal communication and collaboration tools. These have then attracted the attention of businesses, government bodies, charities and other organisations that also wanted to exploit them to improve communication and collaboration with and between their many internal and external stakeholders.

As more organisations explore the possibilities offered by public social media and ‘enterprise’ social tools they are finding that they can help to:

  • improve communication and collaboration (inside and outside the enterprise)
  • enhance decision-making and productivity
  • open up new routes to investment
  • support the development of new products and services
  • improve understanding of customers and clients
  • personalise customer experiences
  • analyse and respond faster to feedback
  • tap into and exploit intelligence outside the enterprise
  • source, attract and engage talent, and
  • develop a brand and build brand loyalty.

When businesses began exploiting social technologies they tended to focus on many of the same types of social media as had gained popularity with personal users. At one end of the spectrum businesses are using LinkedIn for recruitment and Facebook for brand management. At the other end, sites such as Crowdfunder and Kickstarter are being used to raise investment for start-ups and established businesses. The Securities and Exchange Commission in the USA has announced that social media outlets such as Facebook and Twitter can be used to make disclosures to investors (SEC 2013).

The appeal of a Facebook-style interface tends to be generational, but research shows that social technology ranks second behind analytics as a technology innovation priority. Adoption is expected to increase as accountants in practice and the finance function understand what social collaboration can do to improve their performance.

Research by ACCA on the technology trends that will impact the profession shows that a significant portion (59%) of respondents expect widespread adoption by the profession within the next two years, and 29% within the next two to five years. Over 9% expect to feel the impact on the finance function between five and ten years from now, and just 2% expect no impact on accountants and the finance function.

As enterprise social functionality improves, social tools will become more useful to the finance function. In an ideal world, collaboration software will develop situational awareness that enables it to contextualise processes and the roles and relationships of participants. In the context of finance, for example, software needs automatic understanding of the difference between general exchanges and any that must be tightly controlled – such as exchanges between tax and finance departments.

Read more about the technology trends that are impacting on the accounting profession at http://roleofcfo.com.

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Digital service delivery

By Jeff Thomson, CMA, CAE, IMA President and CEO

Automation: we’re seeing it everywhere – from checkout lines at supermarkets to the way accounting departments file reports. These days, it seems that most organisations across a wide array of industries are employing some kind of digital service delivery. The goal: to increase efficiency, customer satisfaction, and market penetration.

While some new companies may be fully digital from the start, most organisations are at an intermediate stage, adopting tools such as self-service bots on retail websites, finding value in the analysis of large data sets, or using the eXtensible Business Reporting Language (XBRL) to file statutory returns electronically.

Exploiting such emerging technologies as web-based business processes, e-commerce, mobile commerce (m-commerce), and cloud-based software and services can enable an organisation to:

  • automate repetitive and time-consuming tasks
  • streamline complex business processes
  • replace human interaction with machine-to-machine and person-to-machine interaction
  • reshape business models to make the most of available resources
  • access and provide public services more easily and cheaply, and
  • monetise underused assets.

Take XBRL, for example. So far, most XBRL adoption has been driven by regulatory compliance. This has improved data access for investors and other stakeholders all over the world. But it could do even more to enhance the automated exchange of data internally and along supply chains. How? If businesses and professional bodies around the world can co-operate to produce the required taxonomies, if software developers strengthen their existing products and create new ones, and if businesses advocate for change – the positive impact of XBRL could be even greater. (Of course, it’s also possible that another technology could come along and make XBRL obsolete).

Further, as more and more accounting services are provided digitally, there may even be a dis-intermediation of the accountant’s role in regulatory compliance. The systems of businesses and those of regulators could eventually become so interconnected that they can exchange information automatically after it has been verified by smart software.

The fact is, if firms don’t embrace automation and enhance their services, they risk obsolescence. According to a report by ACCA and IMA, Digital Darwinism: Thriving in the Face of Technology Change, the majority of accountants intend to avoid this: 64% said they expect to embrace digital service delivery within the next two years and 31% said they’ll do so within two to five years.

While some firms and organisations are using digital technologies to provide real-time collaborative advice and services, others may need to do more. Those that miss the window of opportunity risk becoming casualties of ‘Digital Darwinism’. Fortunately, the evolutionary process brings both good news and bad: No entity is too big to fail or too small to succeed.

Read more about the technology trends that are impacting the accounting profession at www.roleofcfo.com.

cloud computing

By Raef Lawson, Ph.D., CMA, CPA, vice president of research, IMA

Some metaphors are perfect, enabling you to conjure up a precise image in your mind. Other metaphors: not so much. If you’re confused by the term ‘the cloud,’ you’re not alone. But ‘the cloud’ is easier to understand than you think – and it has the potential to reshape the business and accountancy profession over the next decade and beyond, according to a recent report from ACCA and IMA, Digital Darwinism: Thriving in the Face of Technology Change,

In the early days, ‘the cloud’ was simply a metaphor for the internet. As this evolved from a network that connects millions of computers into a network of interactive computing platforms, the metaphor evolved too.

Organisations of all kinds now supply and use a growing range of cloud-based IT resources ‘as a service’ rather than ‘as a product’. Physically remote software applications, computing power, and data storage can be accessed online from fixed and mobile devices, providing benefits that can include:

  • 24/7 access
  • ability to scale up and down to meet demand
  • reduced up-front costs
  • pay-as-you-go charges based on consumption
  • lower management overheads
  • reduced maintenance costs
  • rapid implementation times
  • easier data-sharing and collaboration.

As with many types of technology, levels of adoption vary across geography, industry, size and type of organisation, and profession. In our profession, accountants are already exploiting different types of cloud and cloud-based services. For example, systems for bookkeeping and accounting were among the first software applications available as online services.

There are two types of cloud deployments – public and private – and each brings its own challenges. A recent survey of IT professionals (IDG Enterprise 2013) found that private cloud deployments outnumbered public ones. That’s likely the result of concerns over public cloud resources, including data security, privacy and sovereignty, and the transmission and storage of data outside national boundaries. Many of these concerns are driven by regulations, such as the UK Data Protection Act and the US Patriot Act.

There are other areas where public cloud services and their consumption-based, pay-as-you-go approach can create challenges for accountants and their organisations. For example, lack of integration between systems and their associated data can be a barrier to efficiency. Other concerns range from the expectation that IT systems will be (because they are online) available at all times to the widespread misconception that pay-as-you-go is always the most cost-effective way to resource IT.

Despite these and other challenges, most organisations will continue to access IT resources using both traditional and cloud-based systems well into the foreseeable future. What’s more, the ACCA and IMA research found unanimous agreement on the significance that cloud computing will have as it becomes increasingly adopted by accountants and the finance function; some 72% expect this to happen during 2014-2015.

You can read more about this and other technology trends that are impacting the accounting profession by visiting the ACCA and IMA website, www.roleofcfo.com.

education

By Raef Lawson, Ph.D., CMA, CPA, IMA Vice President of Research

Take a glimpse inside any classroom today and you’ll notice something obvious: digital technology is reshaping education. And it’s not only changing what’s inside the classroom, but what’s going on outside classroom walls as well, in the comfort and privacy of learners’ homes and offices.

This fact, and its implications for the accounting profession and business landscape, is just one of the trends identified and analysed by a recent report from ACCA and IMA, “Digital Darwinism: Thriving in the Face of Technology Change,”

Of course, the advent of digital technology is nothing new. It began with the internet and as digital technology has evolved and expanded, so has its capacity to allow access to innovations such as live and interactive online classrooms, as well as their latest incarnation: massive open online learning courses, or MOOCs.

In tandem with the acceleration of digital technology, educational techniques also are changing, reflecting the new demands of computer-based learning and exploiting the new possibilities created by emerging technologies.

Employees, employers, teachers, and education providers are just beginning to explore the myriad possibilities, but as the role of digital technologies grows, so does the potential for:

  • increasing flexibility, access, and choice in education
  • customised, personalised, and optimised learning
  • attracting and retaining younger generations in the workforce
  • increasing the global mobility of professional talent
  • higher levels of student engagement
  • innovative approaches to lifelong learning
  • new educational business models
  • a rich, diverse, and inclusive virtual education ecosystem, and
  • a global, knowledge-based economy where creativity and innovation are the benchmarks of success.

Digital technology is underpinning an even more radical educational delivery system – MOOCs – which offer access to interactive online courses on a vast scale. Among their unique features, MOOCs usually offer enrolment to anyone, regardless of their level of education, and many (though not all) MOOCs and their learning materials are free.

Fortunately, accountancy training has been quick to employ emerging technologies and tap into their potential to enrich learning. For example, there are several global web-based classes where students can interact in a virtual classroom, in real time and with a live tutor.

Among other examples, the software provider SAP (known among accountants for its enterprise resource planning systems) is working with the Hasso Plattner Institute to provide MOOCs on topics that support people who work in the SAP ecosystem. And employers such the insurer Jardine Lloyd Thompson (JLT) are using MOOCs as an alternative to classroom-based solutions and off-the-shelf e-learning tools.

These developments, and others like them, make it clear that digital technology is here to stay. The question now is only how best to adapt and use this technology to enhance access and ease of learning for all.

You can read more about this and other technology trends that are impacting the accounting profession by visiting the ACCA and IMA website, www.roleofcfo.com.

The age of the machines

accapr —  13 January 2014 — Leave a comment

robotics

By Faye Chua, head of futures research, ACCA

ACCA’s latest report Digital Darwinism: thriving in the face of technology change, focuses on 10 technology trends with the potential to reshape the profession and business landscape significantly. One of the trends identified was the rise in Artificial Intelligence and robotics.

As robotics has become more cost-effective, its use has become commonplace in industries ranging from manufacturing, through medicine to structural engineering. On the other hand, AI pushes the boundaries even further by transforming software and business processes across many different industries. It is enhancing developments in areas such as facial recognition and changing approaches to the security of systems and processes. Interactive Web robots, known as ‘bots’, have become the public face of AI and robotics, giving advice, customer service, information and support in areas including financial services, retail, and utilities.

As software and hardware become smarter and more ‘intelligence’ is built into them, they are complementing and replacing human activities and decision-making processes. By exploiting existing AI and robotics technologies and exploring the emerging possibilities, businesses can benefit by:

  • automating routine, repetitive and labour-intensive tasks and processes
  • reducing operating costs and increasing efficiency
  • providing 24/7 service via myriad fixed and mobile devices
  • developing innovative new products and services
  • ensuring that products and services meet customer needs
  • scaling up operations with fewer and cheaper resources, and
  • extracting more value from existing investments in technology.

The achievements of AI supercomputers such as IBM Watson attract understandable publicity. IBM Watson uses Neuro-Linguistic Programming (NLP) to understand human speech, make sense of huge amounts of complex information, rank answers based on probability, and learn from its mistakes. The application of AI and robotics is also spreading in industry. The Chilean state copper giant Corporacion Nacional del Cobre de Chile (Codelco) uses AI and advanced knowledge-extraction techniques to generate potential targets for exploration and to automate many mining processes.

Accountants and finance professionals increasingly rely on the expert knowledge built into software to work efficiently and effectively in a range of scenarios – particularly in rule-based areas such as compliance. Smart software is being used to ensure the consistency of audit-related processes and their compliance with International Auditing Standards; software for applying eXtensible Business Reporting Language (XBRL) tags to financial information, and learns from the decisions made by its users. In the US an intelligent system based on AI, negotiation techniques and argumentation theory is being used to check whether supplier selection processes comply with the Sarbanes–Oxley Act.

In the recent ACCA/IMA survey, 24% of respondents predict the widespread adoption in accountancy of AI, expert systems and robotics within the next two years. Such adoption has the potential to transform the profession.

Read more about the technology trends that are impacting on the accounting profession at http://roleofcfo.com/.