What is robotic process automation in finance?
Lately it seems that everyone is talking about automated accounting.
You’ve probably heard of software packages such as Xero and QuickBooks, but you may be less familiar with other, more specific types of automation that are available.
Robotic process automation (RPA) is often misunderstood, but it has a lot of potential for accountants. In this blog post, we’ll guide you through the basics of RPA, and help you to decide if it’s right for your business.
What is RPA?
Robotic process automation is a simple way to automate repetitive tasks. It involves training a piece of software to perform a single function, usually by interacting with a program in the same way that a human would.
This allows you to increase efficiency without implementing more widespread automation.
Which tasks can be automated with RPA?
RPA is best suited to simple, repetitive tasks. The kind that a human could do easily, but which would quickly become tedious. If a job involves moving a lot of data from one place to another, RPA is probably a good choice.
Examples include:
- keeping records of transactions
- extracting data from invoices and putting it into a single format
- matching invoices to purchase orders
- managing payroll by keeping track of overtime, paid leave, pensions and taxes
- compiling reports from existing data.
Is RPA a form of AI?
Despite having “robot” in its name, RPA is not a form of artificial intelligence. AI uses machine learning to mimic human intelligence. It analyses all data at its disposal to spot patterns, and uses this knowledge to make increasingly sophisticated decisions.
RPA does none of this. It merely follows the rules that it is given. Put simply, AI tries to replicate human thinking, while RPA can only replicate human processes.
This means that RPA poses no threat to the jobs of accountants. While many have genuine concerns that an AI could learn to “be” an accountant, there is no risk of this with RPA.
An RPA program will repeat its given task as many times as necessary, but it does not have the ability to learn from this process, or to teach itself other functions as it goes.
What are the benefits of RPA?
When used correctly, RPA has many advantages for accountants. These include:
- increasing efficiency by speeding up data entry
- freeing up your staff to perform more skilled tasks
- improving morale by removing the burden of repetitive data entry
- improving accuracy by eliminating human error
- reducing the likelihood of fines and penalties caused by inaccurate record keeping
- improving cashflow by reducing the time it takes to process invoices
- keeping data entry in-house rather than outsourcing it.
RPA is not for everyone. You may already have a comprehensive accounting package that provides all the automation you need. Or you may simply not spend enough time on data entry to warrant an automated approach.
On the other hand, if specific tasks are consistently slowing you down, a targeted RPA could be just what you need. So why not give it a try and see if it’s right for you?
If you have questions about RPA, or any other forms of accounting automation, get in touch.