Microsoft Corp. employs about 5,000 people in its finance team, a number that has remained largely flat in recent years, even though the company’s operations, profit and market capitalization have grown tremendously. Microsoft had 181,000 employees at the end of June, when its fiscal year closed, up from around 163,000 a year before.
A host of technologies, including artificial intelligence (AI), bots, the cloud, data lakes and machine learning are helping Chief Financial Officer Amy Hood keep a tight lid on finance headcount. Cory Hrncirik, who works on Ms. Hood’s team and leads Microsoft’s Modern Finance initiative, told WSJ’s CFO Journal about the new tools, and why the organization still uses Excel for some tasks.
In recent years, as Microsoft has transitioned from a traditional software company to a cloud-first, mobile-first enterprise, the Redmond, Washington-based technology giant has also put a lot of focus on its artificial intelligence (AI) and bot initiatives. And it’s been paying off.
In its most recent fiscal year, ended June 30, 2017, Microsoft’s AI and bots businesses generated $8.4 billion in revenue, up from $0 in the prior year. That growth is being driven by increased demand from both consumers and businesses for AI-powered services and products.
As part of its effort to capitalize on this growth, Microsoft has kept its finance head count relatively flat even as it continues to invest in new areas like AI and bots.
“We have about 13,000 finance employees globally, and we’re not planning on growing that headcount significantly,” said Amy Hood, executive vice president and chief financial officer (CFO) at Microsoft, in a recent interview with CNBC.
That’s thanks in part to the increasing use of AI and bots within the company’s finance department. For example, Microsoft has been using AI to automate the process of reviewing invoices for potential errors. The software can identify discrepancies in invoices based on predefined rules and then flag them for review by a human.
This type of automation is helping to reduce the amount of time and effort needed to review invoices, freeing up employees to work on other tasks. Microsoft has also been using AI to help with budgeting and forecasting.
“We’re using machine learning and artificial intelligence to really do a lot of the heavy lifting in terms of understanding what’s going on in our businesses so that we can be more proactive,” said Hood.
Microsoft isn’t the only company turning to AI and bots to automate finance-related tasks. A number of startups, including Bill.com, Botkeeper and FinGenius, are also leveraging AI and bots to help businesses automate things like bookkeeping, invoicing and payments.
So far, the results have been impressive. According to a recent report from PwC, 82 percent of companies that have adopted some form of AI say it has led to increased efficiency within their finance departments.
As AI and bots continue to proliferate, it’s likely that even more companies will begin to adopt these technologies in order to reduce costs and improve efficiency within their finance departments. And with Microsoft leading the way, it’s clear that the days of the human CFO are far from over.