Computer Financial Systems and the Labor Market

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Table of Contents

Introduction
Modern Advanced Technology Development
Reasons for Introducing Advanced Computer Systems and Software
Advantages of Developing Computer Financial Systems
Decreasing Job Opportunities Due to Computer Systems and Software
Combining Artificial Intelligence and Human Operating
Conclusion
References

Introduction

The rapid and stable growth of the innovation computer base in various fields indicates that modern technologies have become an integral part of almost every industry’s work. Specialized equipment and software developed for solving the problems of different profiles make it possible to simplify operating processes and, in many respects, speed up professional activities. With regard to the field of finance and accounting, computer systems are indispensable since digital technologies contribute to conducting complex computational operations and even planning certain stages of working with cash flows.

Nevertheless, when analyzing this topic from a different angle, one can note a controversial aspect of computers’ total distribution – the level of employment and job opportunities. Performing a number of functions on computing equipment reduces the need for human activities significantly, which is a potential problem of modern times. This paper aims to describe the trend of technological progress, the causes and advantages of developments in computer financial systems, as well as the implications of the transition to digital tools for the labor market. Combining artificial intelligence with human work may help avoid negative consequences and achieve providing jobs to those who need them.

Modern Advanced Technology Development

In a modern technological environment, the tasks of financial management and control over profits and expenses are largely carried out through the introduction of highly efficient computer systems and software. According to Radu and Marius (2012), accounting programs based on the use of advances in the development of artificial intelligence, bioengineering, and other related areas provide an opportunity to establish a stable mode of operation. In addition, as Tan and Laswad (2018) note, the knowledge of the specifics of corresponding software opens up substantial prospects for those who intend to work in the accounting field. Project planning and analysis systems allow minimizing financial and other risks, which is an absolute plus and rationale to support the development trend and its logical background.

A large number of start-up companies working on creating relevant business software are the evidence of a course for innovation. Péralte (2018) argues that the stages of monitoring a specific environment, analyzing interventions, and launching specific innovations may be performed by using off-the-shelf software. Such an approach is common and popular due to reduced responsibility for the decision-making process and simplified accounting. According to Tsai, Lee, Shen, and Lin (2012), the range of diversity of these computerized systems is extensive, and preferences for a particular application are given due to the functionality of the programs and their relevance in a particular financial environment. Therefore, competition among the manufacturers of such software is high and tense.

The trend of technological advancement is widespread, which explains the constant appearance of new products in specialized markets. In the field of finance and accounting, those programs and applications that allow controlling any changes and predicting risks serve as standard operating tools. The use of such systems is not a desire to demonstrate the high status of a company but a necessity since many procedures may be performed by utilizing appropriate software. As Adams and Link (2018) state, intellectual property is a valuable component in an increasingly competitive environment, and ensuring sustainable working principles to promote modern technology is a step towards its preservation. Therefore, the modern trend of innovation is natural and reasonable in the current market conditions.

Reasons for Introducing Advanced Computer Systems and Software

Creating professional computer systems designed to work with financial reporting is a necessary practice in the context of dynamic economic indicators and the use of various planning tools. According to Füssl, Streitferdt, Shang, and Triebel (2015), “software development teams have to adapt continuously for fitting newest stakeholder needs and finding success in the market” (p. 1). As a result, updating the existing software components and making innovative computer systems are the consequences of the growing interest in improving the performance of the digital base. Therefore, one of the key reasons for introducing advanced technological mechanisms is the need to conduct operations that meet contemporary quality standards.

The financial sector is not the only one where involving the latest digital developments is a relevant practice. For instance, Marks (2010) mentions the medical sphere and notes that progress in diagnostics and screening testing is largely due to the development of appropriate computer systems. The analysis of academic literature proves that engaging special software is essential to not only avoid mistakes when planning activities but also not to lose market positions. As Monostori et al. (2016) remark, competitive advantage, as a factor associated with profit, is achieved due to smart cyber-innovations that allow maintaining operating activities at the level that satisfies consumers. Therefore, the introduction of advanced software is relevant not only in the field of financial reporting but also in other sectors.

The evaluation of the effectiveness and working performance are the aspects of planning that encourage stakeholders to utilize high-tech computer systems for accounting. Romero and Vernadat (2016) state that the promotion of corporate value as one of the management strategies is the principle that may be implemented through the use of specialized monitoring software. Despite the potential challenges that may arise in the course of work, the need to apply for such systems outweighs the fears of their uselessness. Therefore, the trend of involving digital systems is strategic and logical due to ever-growing competition conditions and the importance of control over all processes within companies.

Advantages of Developing Computer Financial Systems

The development of computer systems and high-performance software in the financial and accounting sectors has a number of advantages achieved due to the high functionality of these tools. Coe and Yeung (2015) argue that one of the main merits is the price benefit that advanced digital programs provide. Interested parties do not have to spend substantial funds on the activities of analysts who monitor all the changes in the workflow and make development forecasts. In addition, as Wuest, Weimer, Irgens, and Thoben (2016) note, these systems make it possible to optimize quality control and maintain consistently high productivity. These properties are the factors in support of the use of innovative software in the financial sector.

Another indisputable and aforementioned benefit is a competitive advantage that is acquired through the introduction of appropriate digital systems. Hsu, Tian, and Xu (2014) state that an opportunity to perform all accounting calculations competently and quickly through the use of high-precision functionality enhances the status of a certain company and makes its activities credible. Accordingly, the interest of consumers, investors, and other stakeholders increases, which has a positive effect on profits and allows maintaining a high corporate value. This outcome is essential for both start-up firms and experienced companies. Therefore, the involvement of specialized software has positive implications for the authority of organizations.

Finally, the advantage expressed in strategic success is one of the factors for introducing computer systems into financial and reporting activities. According to Nwankpa (2015), the standardization and orderliness of management are the outcomes of work on promoting the innovative development of the accounting sector due to the ability to control all the income and expense procedures. The absence of errors due to the human factor allows avoiding undesirable results and, consequently, increases productivity. Moreover, as Nwankpa (2015) remarks, the entire information infrastructure is available for reorganization, which allows for adjusting the current mode of work. All the considered advantages prove the relevance and benefits of computer systems in the financial and accounting fields and may serve as justifications in support of the acquisition of appropriate software based on artificial intelligence.

Decreasing Job Opportunities Due to Computer Systems and Software

Despite the advantages that may be achieved through the introduction of computer systems and software in financial activities, there is an issue that is acute because of the global spread of such functionality. This is the problem of the labor market and job opportunities for people whose duties are increasingly being performed by digital programs. Frey and Osborne (2017) note that “the poor performance of labor markets across advanced economies has intensified the debate about technological unemployment among economists” (p. 254). Technological progress that proceeds rapidly entails a reduction in opportunities for applicants due to the fact that artificial intelligence is able to perform similar functions while avoiding errors. Chamoso, Rivas, Rodríguez, and Bajo (2018) remark that there are communities for those who are willing to combine their activities with the work of digital equipment. Nevertheless, despite this possibility, the risk of reducing the number of jobs is objective, and specialists with financial and economic education may feel the negative consequences of the transition to computerized practices.

Conclusions about the potential reduction of jobs are reasonable and logical. According to Peng, Wang, and Han (2018), some procedures, in particular, routine tasks for standardized calculations and budget planning, are increasingly performed by digital programs rather than people. At the same time, the motives of individual companies’ managers are understandable and explainable since they do not need to pay subordinates for the work that special applications do stably and, in addition, for free. As Prasad and Green (2015) state, modernized accounting systems provide decision-makers with valuable information, and engaging additional labor is unjustified. Applicants, in turn, are unhappy with this situation, and Willison, Warkentin, and Johnston (2016) note that the attitude towards technological progress becomes ambiguous and sometimes negative. In order to avoid this, it is crucial to integrate the software into the workflow harmoniously. Otherwise, computer systems will force out human labor and create a severe problem of unemployment in the economic sector, which can be even a more challenging issue for this sphere than insufficient productivity.

Combining Artificial Intelligence and Human Operating

In order to prevent an unemployment crisis and provide jobs for all applicants, it is essential to integrate modern technologies wisely and not to use them to perform all the tasks without exception. Managers should understand and distinguish among those functions that people and programs cope with successfully. For instance, according to Agrawal, Gans, and Goldfarb (2019), today, forecasting is the area of financial activity that special computer systems do better than analysts. However, the work of ordinary employees can also be valuable and useful. Davenport and Ronanki (2018) note that the characteristics of human nature make it possible to maintain a more creative environment for the implementation of the tasks set. Routine procedures that artificial intelligence copes with are sometimes combined with situational approaches. In case this function is assigned to personnel, productivity may be improved, and valuable and talented employees will not lose their jobs.

The negative consequences of the widespread introduction of computer systems in financial activities can manifest themselves in an insufficiently high corporate culture. As Wright and Schultz (2018) state, “automation could decrease the regularity and quality of human interactions, which may contribute to greater feelings of isolation and disconnection” (p. 826). In order to prevent this, it is necessary to integrate modern software into the workflow of companies so that it could contribute to increased work efficiency but not its decline. According to Pueyo (2018), people tend to take the initiative and motivate colleagues to improve performance. If managers make efforts to enhance the communicative competence of employees, this will prove the viability of human labor and prevent computer systems from crowding it out completely.

Conclusion

Combining the opportunities achieved by introducing innovative computer systems in the financial and accounting industries with human resources is a good solution for reducing the likelihood of an unemployment crisis. The advantages of modern software aimed at predicting operating activities and control over budget funds are undeniable. However, employees’ activities also have some strengths, in particular, the ability to adapt to specific working conditions and situations. Today, the tendency to transition to a computerized model is relevant. At the same time, in order to save job opportunities for applicants and maintain a high level of efficiency, it is crucial to integrate digital systems and programs into the work process but not to give preferences to them exclusively. The proper combination of computer technology and employee incentive strategies may help maintain a high level of corporate culture and withstand market competition.

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