How
Accountants Can Survive Industry 4.0
garyeastwood
Loess Hills Accounting
Blogger
Sep 28th 2017
Some analysts call it Industry 4.0, claiming that this is the fourth Industrial
Revolution and will change every aspect of society. Others worry about
the potential downsides such as
security or how workers will be impacted by new changes.
But no matter the name, the last few
years has witnessed見證 an explosion of new technology.
The Internet of Things (IoT), Big Data, and automation will affect how
businesses work, and how CPAs do
their jobs做他們的工作. It is consequently critical that accountants look at these
technological trends科技趨勢, understand the resulting changes,
and figure out what role they can play in the new economy which will be
created.
The
Power of the Internet of Things
People have been talking of the Internet of
Things for years, and ZDNet reported in June that IoT spending will reach over
$800 billion in 2017 and $1.4 trillion by 2021. Furthermore, ZDNet also states
that “manufacturing, freight monitoring and
production asset management will attract the largest investments.”
On a basic level, the Internet of Things revolves around環繞 different devices, devices which
never before have been connected to
the Internet, communicating with one another. Manufacturing equipment can be
connected and transmit data, which allows businesses to respond faster to
developing situations.
For example, a piece of industrial machinery can now transmit a warning of when it is about to fail or
is nearing the end of its lifespan. Before, a factory would either have to spend hundreds of man
hours checking machinery, including your signal booster,
to make sure everything is in order, waste space and money storing spares in
case a piece happened to fail, or even shut down should that piece suddenly
fail without warning. Now, a factory can order parts only when they need it,
eliminating downtime, saving money, and making machine failures far less
frequent.
A key thing to note in the above example is
the role which data
plays. The
Internet of Things and Big Data are linked together, as devices
connected to the Internet will be constantly transmitting data to interested
parties. More businesses with more data means more analysis and prediction. A
2016 survey of industrial participants reported by Forbes showed that “83%
expect data to have a significant impact on their decision-making in five
years” while only half are using data now. Manufacturers
could even sell data received from customers using their products to other
customers, establishing a data market
and a new revenue stream.
The transition to manufacturers
wholeheartedly embracing the Internet of Things will take time, as
manufacturers slowly upgrade their equipment and learn how to use data to make
smart decisions做聰明的決定. But whether it comes slowly or
quickly, Industry 4.0 is coming.
The
Role of the CPA
The Internet of Things, Big Data, and
Industry 4.0 will have major effects for CPAs both directly and indirectly.
Directly, accountants will now have to prepare
to face an incoming stream of real-time
financial data instead of periodically
checking in with a bookkeeper. Auditing in particular will become
much easier. Accountants can catch financial fraud faster, minimizing the damage, and can also notice financial
trends and offer more real time advice.
But only CPAs who
learn how to manage these large real time data flows will be able to take
advantage. They will thus have to learn the language of IT
and IoT concepts in order to construct new accounting and reporting
structures. Once that is complete, accountants can then help their clients as
well, providing advice on how to build a business structure which takes full
advantage of the IoT.
Providing advice will be the main way through which Industry 4.0 will
indirectly change the accounting profession. Automation and artificial
intelligence are already changing the industry
so that as Firm of the Future states, the accountant’s role will evolve from
reporting and compliance work to becoming “forward-thinking small business
advisors.”
Industry 4.0 will amplify that trend,
especially because many businesses are unsure of how exactly to embrace the
IoT. The IoT does have potential risks, such as hackers using less protected
devices to commit data breaches or other criminal activities. Accountants will
need to help their clients analyze the upsides and risks of好與壞 using the IoT with any particular device, get the maximum value out
of data they collect, and play a crucial advisory role.
The first Industrial Revolution was all
about size in who could build the
biggest factories, have the most machinery, and get the most workers into a
single space. Industry 4.0 will be about speed. Who can get data the fastest and use it to reach good decisions?
As financial advisors with knowledge of technology, CPAs have a crucial role to
play in helping businesses and must ensure that their own firms are not
swallowed in the new technological storm. There is still time to prepare for
the IoT, but it will not be for much longer.
