Navigating AI in Finance

This chapter explores the complex relationship between finance executives and artificial intelligence, focusing on the necessity of transparency in AI-generated financial models. It emphasizes the evolving role of finance professionals in leveraging AI technologies while maintaining human oversight for effective decision-making.

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This week on the Expert Voices podcast, Randy Wootton, CEO of Maxio, speaks with Paul Barnhurst, an expert in Financial Planning & Analysis (FP&A). Known as the "FP&A Guy," Paul explores the evolution of FP&A over the past two decades, highlighting shifts from back-office reporting functions to becoming strategic partners within organizations. Randy and Paul discuss essential modeling principles and tools that today's FP&A professionals should master, including modern Excel capabilities and the strategic use of AI in forecasting and planning processes.

Quotes

“FP&A is a lot more than just the reporting and the analysis. That is what I see as FP&A today. I think it's been a gradual shift and it's really accelerated the last few years.” -Paul Barnhurst [09:07]

“I think the most mature thing and where we're pricing the most benefit and planning is with machine learning, predictive modeling. Now, when we talk generative AI, I think there are a few areas that are going to be really helpful, where we're seeing the most use right now. I think the number one area is helping with emails, content, brainstorming, writing.” -Paul Barnhurst [31:34]

Expert Takeaways

Career Shifts and Entrepreneurship: Paul Barnhurst’s journey from government procurement to a leading FP&A influencer showcases the importance of being open to opportunities and continuous learning.
Evolution of FP&A: The transition from back-office reporting to strategic business partnering has made FP&A a critical function in navigating today’s rapidly changing business environment.
Technological Advancements: Advances in cloud-based SaaS technologies and the expanded capacity of modern tools like Excel have revolutionized data management and analysis in FP&A.
Financial Modeling Best Practices: Effective model design is paramount. Principles such as color coding, structured inputs and outputs, and avoiding hard-coded values ensure reliability and scalability.
AI Integration: The role of AI in finance, particularly generative AI and machine learning, is set to make FP&A both more strategic and technically involved, allowing for more sophisticated decision-making processes.

Timestamps

(00:04) Navigating Career Shifts and Embracing Opportunities in FP&A

(06:54) The Evolution of FP and A from Reporting to Strategic Partner

(10:30) The Evolution of Data Analysis and AI in Finance

(17:08) Top Financial Modeling Practices and Common Pitfalls

(19:04) Challenges and Trust in Building Financial Models for Tech Startups

(27:13) The Role of AI and Machine Learning in Finance

(36:15) Key Metrics and Influences in SaaS Business Growth

(38:23) Influential Figures in Finance, AI, and Financial Modeling

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