Where can you help reduce the cost to serve?

The adoption of emerging technologies is no longer a bold enough measure to stand out in financial services. AI integration is widely perceived as the sector’s barometer for innovation, with 91% of financial services companies already using or considering introducing AI solutions.

However, the organisations that best understand how to utilize the multitude of new solutions available and leverage them to lower cost to serve will successfully differentiate themselves from rivals.

In this rapidly evolving landscape, accountants are uniquely positioned to drive significant change. Their deep understanding of financial processes, combined with their strategic outlook, makes them ideal candidates to spearhead initiatives aimed at reducing the cost to serve.

The concept of ‘cost to serve’ encompasses all expenses incurred by a company in serving its clients. In the financial services sector, this includes everything from administrative tasks and compliance procedures to client communication and service delivery. As competition intensifies and profit margins shrink, reducing these costs has become a critical strategy for maintaining competitiveness and profitability.

The true value of AI in financial services lies in reducing the volume of manual work, which typically leads to more frequent errors, slower processes, and higher labour costs. This is where senior accountants can make a significant impact.

By leveraging their comprehensive understanding of financial workflows, senior accountants can identify areas ripe for technological intervention. Non-advisory, compliance, and administrative tasks often increase the cost to serve, and these processes should be prime targets for automation. For instance, systems that automatically classify documents and apply granular access controls without human intervention can significantly ease the compliance burden.

However, the role of senior accountants extends beyond merely identifying areas for automation. They play a crucial part in ensuring that AI and other technologies are implemented effectively and aligned with the organisation’s broader strategic goals. This involves not just technical knowledge, but also change management skills.

One of the key challenges in implementing new technologies is resistance from staff who may fear job displacement. Senior accountants can help address these concerns by demonstrating how AI and automation exist to support employees, not replace them. They can articulate how these technologies can free up time for more value-added activities, enhancing job satisfaction and career development opportunities.

Moreover, senior accountants are well-placed to educate other executives on the capabilities and limitations of AI. This is crucial for ensuring that resources are allocated to areas where they can add the most value. By providing clear, data-driven analyses of potential cost savings and efficiency gains, accountants can build a compelling case for investment in new technologies.

The strategic implications of reducing the cost to serve extend far beyond immediate cost savings. As Lobo points out, “Ultimately, financial services providers need to deliver a return for their customers to demonstrate value, which is easier if more time is spent on client-facing activities.” By automating routine tasks, accountants can help shift the focus of the organization towards activities that directly add value for clients.

This shift can have profound effects on client relationships. With more time dedicated to advisory services and personalized attention, financial services firms can enhance client satisfaction, improve retention rates, and potentially attract new business. In an increasingly competitive market, this improved client experience can be a key differentiator.

Furthermore, the cost savings generated through these initiatives can create a virtuous cycle of investment and innovation. As Lobo notes, “Higher profits facilitate further investment. If firms have the capital to re-invest, they can funnel additional resources into developing effective tech solutions, reinforcing and extending competitive advantage.”

Looking to the future, the role of senior accountants in large corporates is likely to evolve significantly. As routine tasks become increasingly automated, the focus will shift towards strategic financial management, risk assessment, and business partnering. Accountants who can successfully navigate this transition, combining their financial expertise with technological savvy and strategic thinking, will be invaluable assets to their organizations.

As financial services firms grapple with the challenge of standing out in an increasingly crowded and technologically advanced market, reducing the cost to serve has emerged as a key strategy. Senior accountants, with their unique blend of financial acumen, process understanding, and strategic insight, are ideally positioned to drive this change. By leveraging new technologies, optimizing processes, and refocusing resources on value-added activities, they can help their organizations not just reduce costs, but also enhance client satisfaction and drive long-term growth and competitiveness.