AI financial planning should be limited to short-term decisions

Research conducted by Valerick Business School has discovered that in the field of financial planning for Amnesty International, technology is constantly outperforming humans when allocating budgets with strategic guidelines. Companies that use artificial intelligence in budget processes suffer from significant improvements in the accuracy and efficiency of budget status plans compared to the process of human decision -making.

The goal of the study was to explain the role of artificial intelligence in the corporate budget, and to study the extent of the performance of this technology when making financial decisions. Ultimately, it is an investigation of whether the financial decisions of the IQ Agency are in line with the company’s long -term strategies and how its decisions are compared to human management.

Researchers, Christophe Stoyaoon, Professor of Administrative Accounting and Digital finance at the Falac College of Business, PhD Researcher, Emma Wilms, studied the tactical and strategic budget curricula.

The tactical budget revolves around fast and fast response decisions, referring to the short -term financially -based financial decisions. This aims to improve immediate performance, such as making spending adjustments on the basis of market trends.

The strategic budget usually includes a more comprehensive approach that focuses on future planning, align the various resources with the company’s vision.

According to the research, artificial intelligence is superior when performing tactical budgets such as cost management and resource customization. However, the need for human insight remains important to ensure accurate and strategic financial planning in the long run.

The control experience was achieved through the management simulation management, where experienced managers were asked to allocate budgets for virtual automotive parts. Then compare Stouthuysen and Willems these decisions made by man with those produced by the artificial intelligence algorithm using the same financial statements.

The results concluded that artificial intelligence was superior to improving budgets when the company’s strategic planning for the company was clearly identified. However, Amnesty International has struggled to take budget decisions when the main performance indicators (KPIS) did not match the company’s financial goals.

Stuffysen and Willems emphasized the importance of human and AI cooperation. “With the continued development, companies that use their strengths in the tactical budget while maintaining human control in strategic planning will get a competitive advantage. The key is to know where artificial intelligence should lead and where the human intuition remains indispensable.”

According to the study, Amnesty International can theoretically take over from humans when it comes to tactical bizarre, which provides more accurate and effective results. Stouthuysen and Willems believe that companies need to determine their strategic priorities clearly and implement artificial intelligence for tactical budget makers to increase financial offers to the maximum and achieve sustainable growth.

The results challenge that the widespread misconception that artificial intelligence can replace the need for humans in the balance completely. Instead, this research emphasizes the importance of following a balanced approach, the use of both artificial and human intelligence, and the assignment of the tasks of silicon or human operations according to their proven capabilities.

(Photo source: “Payment Day” by 401 (K) 2013 licensed under CC BY-SA 2.0.)

Do you want to learn more about artificial intelligence and large data from industry leaders? Check AI and Big Data Expo, which is held in Amsterdam, California, and London. The comprehensive event was identified with other leading events including the smart automation conference, Blockx, the digital transformation week, and the Cyber ​​Security & Cloud.

Explore the upcoming web events and seminars with which Techforge works here.