The New Bookkeeper Is a Robot

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Vipal Monga writes: Five years ago, 80 clerks and salespeople at Pilot Travel Centers LLC spent a combined 3,200 hours a week tracking and paying for orders for thousands of goods, ranging from candy bars to diesel fuel.

“Today, a computer ‘robot’—basically software—automates these tasks…software sends out payments and records every transaction. As a result, the company needs just 10 clerks working a weekly total of 400 hours to pay suppliers.”

They typed the orders into an accounts-payable database, and printed out thousands of checks to pay suppliers. After slipping them into envelopes and adding postage, they put the checks in the mail.

Illustration by Randall Enos

Illustration by Randall Enos

“Automation is threatening to replace swaths of white-collar workers, much as mechanical robots have displaced blue-collar workers on assembly lines.”

“It was just awful,” said David Clothier, treasurer of the Knoxville, Tenn., company, which operates more than 500 Pilot Flying J truck stops nationwide. “There were humans everywhere.”

Today, a computer “robot”—basically software—automates these tasks. Suppliers send their invoices to Pilot Travel electronically. Its software sends out payments and records every transaction. As a result, the company needs just 10 clerks working a weekly total of 400 hours to pay suppliers.

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Robots are taking over corporate finance departments, performing work that often required whole teams of people. Big companies such as Pilot Travel, New York-based Verizon Communications Inc. and GameStop Corp., of Grapevine, Texas, are among those using software to automate many corporate bookkeeping and accounting tasks.

Businesses use these programs to save time and staffing costs. Since 2004, the median number of full-time employees in the finance department at big companies has declined 40% to about 71 people for every $1 billion of revenue, down from 119, according to Hackett Group, a consulting firm.

The telecom giant Verizon has reduced its finance-department costs by 21% over the past three years, partially through job cuts. It closed more than half of its 200 back-office locations across the country, built a new hub for finance operations in Lake Mary, Fla., and renovated an existing one in Tulsa, Okla. “The automation is a big factor” in the savings, saidFran Shammo, Verizon’s CFO.

Software has helped Verizon, which had $127.1 billion in 2014 revenue, cut the manual entries its workers punch into Excel spreadsheets annually by a quarter—to 10,500 from 14,000. It aims to cut another 1,400 manual entries by the end of this year for an overall reduction of 35%.

Automation is threatening to replace swaths of white-collar workers….(read more)

The CFO Report – WSJ



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