Well, that was fast. Only four and a half months after a prototype of ChatGPT was released, a company has built and publicly launched an AI CFO. Finance professionals now need to confront the impact that AI is going to have on the finance function—whether they are ready or not.
Sturppy, a Denver-based software company, released a ChatGPT-4 tool as part of its Sturppy Plus FP&A platform on April 8. Called ChatCFO, and currently in alpha testing, it uses AI and natural language processing to interact with and interpret an organization’s financial data. But it’s not simply a ChatGPT plugin; instead, it’s based on a proprietary program and the company brands it as a “personal AI CFO available 24/7.”
It’s the first AI chatbot in production that is trained specifically on financial data that he’s seen and is an important first step in the introduction of AI chatbots into the finance function, Glenn Hopper, director at Eventus Advisory Group and author of Deep Finance: Corporate Finance in the Information Age, told CFO Brew.
“It’s not quite a robot CFO yet. It’s probably not even a junior analyst yet,” Hopper said. “But these are the seeds of what that will be.”
But while ChatCFO, and the other finance-focused AI chatbots likely to follow, are still in the first stages of development, the development raises questions about how finance professionals should prepare for and cope with the changes that this technology will bring.
“If I am the CFO, I’m not going to be replaced by this technology.” Hopper said. “But if I’m thinking strategically, and I know the kinds of questions to ask, then this is a powerful tool.”
New fractional CFO in town? Aimed at growing startups without a lot of financial expertise for now, ChatCFO can answer the same kind of questions one may ask a financial analyst or fractional CFO—and get instant answers based on a company’s financial data gathered from sources like Excel, past financial records, and customer databases. The ChatCFO can also surface KPIs, such as profit and revenue forecasts, and create charts and graphs much like a finance professional, according to John Ladaga, co-founder of Sturppy.
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For example, in a Sturppy promotional video, ChatCFO was asked if the company could afford to hire an operations manager at $5,000 a month, and the AI instantly responded with an analysis of how that hire would impact the company’s bottom line. Hypothetically, that’s the kind of work that might take a financial analyst considerably longer to produce.
Where to now? But if there is now a functional AI that can plausibly do the foundational work of the finance department—such as finance analysis, measuring and predicting performance, and creating KPIs—then where does that leave financial professionals and what do they need to prepare for an AI future?
“I think everybody that’s in a knowledge role today—whether it’s legal, or accounting, or finance—should be thinking about what role [they are] going to play,” Ladaga said. “They should be somewhat worried about the role that they currently play within an organization given that technologies like this are coming out."
That’s been a looming question for many years in the face of finance’s digital transformation but the rapid introduction of AI technology like ChatCFO and ChatGPT turbo boosts the urgency to find an answer, according to Hopper. And that answer lies in a place that is still out of reach for AI, no matter how sophisticated: strategy.
“To me, it says you need to learn more about strategy and learn more about the operations of your company and look beyond just the narrow scope of accounting and think about the impacts on the business,” said Hopper.
Both Ladaga and Hopper agree that AI technology will likely cost at least lower-level finance professionals their jobs in the future. However, they also agree that successful financial professionals will look at and use the technology as a capacity and capability enhancement that works in tandem with strategic skills. Enhance, not replace, as Hopper puts it.
“It’s an evolution to how we interact with computers and with our data and the information that we’ve been using for years,” said Hopper.—DA