Nigerian businesses are increasingly looking towards adopting technology to enhance their financial operations and performance. New technologies like artificial intelligence (AI) and other technological advancements present a unique opportunity to transform traditional business operations, particularly in optimising proactive financial management.
However, the journey towards technological integration is fraught with challenges, including the need for substantial investments, adopting a pragmatic business mindset and addressing data privacy concerns.
The story of Stanley Umeorah, a seasoned finance and business management expert with extensive business consulting experience across Nigeria, the United Kingdom, and the United States of America, illustrates this.
Some of his recent work on AI and machine learning adoption for optimising core business and finance operations highlight unsung benefits of these new technologies. He sheds light on how big data and machine learning can be a game-changer for Nigerian businesses.
Drawing from his recently published article on the use of AI in optimising working capital management, Umeorah emphasises that AI’s ability to automate routine tasks, accurately predict different components of working capital and provide advanced data analytics can significantly enhance operational efficiency.
“For Nigerian businesses, regardless of scale or industry,” Umeorah explains, “AI adoption will reduce the burden of manual transaction processing, working capital forecasting and financial estimation uncertainties, which save time and minimise errors. This will allow businesses to efficiently deploy human capital on more significant tasks that do require human judgement and strategic decision-making, thereby improving overall business performance.”
Integrating machine learning techniques in working capital management can also transform financial decision-making processes.
Umeorah notes that AI algorithms can analyse vast datasets to identify patterns and trends that might not be evident through traditional manual methods. This capability is particularly valuable in Nigeria, where businesses often grapple with unpredictable market conditions and an ever-evolving regulatory landscape. “AI improves cash flow forecasting accuracy and liquidity management, enabling companies to anticipate better and respond to financial challenges,” he adds.
Furthermore, Umeorah highlights the future potential of machine learning in revolutionising financial reporting and forecasting elements of working capital such as inventory, accounts receivable and payable. Automating the data collection and analysis process and layering it with machine learning methods will facilitate the production of real-time, accurate financial reports and forecasts, which are crucial for maintaining operational efficiency, transparency and compliance. “Such automation not only reduces the risk of human error but also frees up valuable time for finance professionals to focus on strategic planning and analysis,” he asserts.
Despite these promising benefits, he acknowledges Nigerian businesses’ challenges in adopting AI. Significant investment in technology infrastructure and workforce training is required, alongside addressing data privacy concerns. He advises a strategic approach to adoption, starting with small-scale projects to demonstrate AI’s benefits and build stakeholder confidence. “Collaboration with tech firms and financial experts is crucial,” Umeorah recommends, “as it can provide the necessary support and tailored solutions for successful AI implementation.”
In his concluding thoughts, Umeorah advocates for Nigerian businesses to embrace technological advancements to enhance their financial performance. By investing in AI and fostering a culture of innovation, businesses can overcome current challenges and position themselves for sustainable growth and success in the dynamic global marketplace.
As Umeorah aptly puts it, “Harnessing the power of AI is not just about keeping up with technological trends; it’s about transforming the foundation of business operations to achieve better financial outcomes.”
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