Sep 24, 2020
In the 19th century, the horse industry was huge. From Leather & Saddles to Horse Carts; everyone who had a business that is related to the horse industry back then got rich. But with the manufacturing of the first car by Karl Benz; the horse industry was about to disappear without a trace.
Yet, that didn't happen overnight. In fact; the horse industry wasn't affected noticeably until the Ford Model T hit the markets. Before that cars were viewed by most people as a luxury item affordable only by the rich. 23 years went by from the moment Karl Benz patented the first car in 1985, to the moment Henry Ford started selling his disruptive Model T in 1908. In those 23 short years, signs that the horse industry was about to die were everywhere, yet; so many businessmen refused to believe that mankind can survive without horses, to them a world where everyone owned a car was just absurd.
It's always this way with technology…... In 1943 Thomas Watson, the president of IBM, said sarcastically about the computer industry "I think there is a world market for maybe five computers". He meant that if computers were to be sold, you can’t find more than 5 people who will buy them. He was %100 sure that computers will never be a thing.
The same thing that happened back then with cars and computers is happening now to accounting.
In the middle of the last century, accountants used to do the entire job manually, a job that requires a part-time accountant today needed at least 5 people to do it back then. With the invention of the first spreadsheet software in the 1980s, accountants had to do less and less work. After that, specialized accounting software started popping up all over the place, and accountants had even less stuff to do.
But there is a big difference between accountants & horses!?
The job of an accountant requires much more creativity than a mere task of transporting someone from point A to point B. Even if artificial intelligence were able to do 95% of the job, still you need an accountant to do the remaining 5%, or at least to oversee the operation. That is due to accounting being an art as well as a science, some accounting problems have multiple right answers, and a good accountant is there to tell you which of them is better for your business. Another reason why accountants will never go extinct is that accounting is a man-made invention, and as long as we don't have a better invention; accountants will still be relevant, at the very least to maintain & improve the standards of accounting.
But all of that doesn't mean that accountants will not be affected by AI, because they will, deeply!!
If AI is able to do %80 of the job of an accountant, that means that 8 out of every 10 accountants will find themselves jobless or with a part-time job and it looks like artificial intelligence will be able to do much more than %80.
You might disagree, but think about it for a second. If AI can drive a car with human lives at stake through an unpredictable road, and if the self-driving car can recognize road signs faster than you can; do you think AI will have trouble doing a job that speaks its native language "NUMBERS".
We are not talking theory nor here, we are deep in the trenches of this and we know what we are talking about. And we are not talking about the future either, it is already being done…..Here are the 3 companies that are really automating the job of the accountant:
1. Veryfi: It’s an app that can read any invoice or receipt you point your camera at, line by line in 3 seconds with an accuracy rate of over 97%.
2. Ask QB: You can ask Quickbooks assistant questions about your data, you don’t need to call your accountant to answer every little question you have, this product is still new but it can be something big one day.
3. Cleo: This little Messenger Chatbot can do your entire personal finances for you. It’s free & very smart, it links to your bank accountant and keep you updated.
Those companies are not automating the whole accountant job, not in a big business, no one can...it’s just too big of a job for AI right now… But for personal finances and any micro business, it can AND IS being done…For bigger businesses, it requires time, decades not years.
But what does all of that mean, what should I do then???
If you are thinking about studying accounting: (Skip the next 2 paragraphs if not)
Then maybe you should consider a double major in both computer science and accounting. Believe me, the programming degree is more relevant to accounting than the accounting degree is….To be honest, in the job market; only 3 type of degrees are relevant to an accountant; CPA, CMA & CAP, none of which need a BA in accounting.
If you already are an accountant: Then you must admit the fact that accounting is changing yet again & you should change with it. Let's admit it; you are not as accurate as AI and you can't be on call 24/7. But luckily, you are the boss; you can use AI to cover your weakness so you can focus more on what humans do best........read data and communicate effectively.
If you own a business: Then you should start adapting to the future, in 1910 any business that was still using a horse got screwed by a business that started using a car. The same thing happened in the 2005, when blockbuster lost everything to Netflix. Don’t be like them…
“It is not the strongest of the species that survives, not the most intelligent either. It is the one that is most adaptable to change”
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