We’ve all seen the headlines.
AI is coming to take your job!
It’s only a matter of time before you’re replaced!
Mass unemployment is just around the corner!
These doomsday scenarios might make for good clickbait, but they don’t tell the whole story. While the fear of widespread job displacement is understandable, we believe the reality in accounts receivable (AR) is far less dire, and frankly, more exciting. What we see is this: in the age of AI, human expertise in AR will be more valuable, not less.
Sound too good to be true? Let’s take a closer look.
Why AR can’t be fully automated
The idea that AI could completely replace AR professionals hinges on one big assumption: that it could handle every single aspect of the job. Not 90% or 95% of it—all of it. But as Oracle NetSuite points out, AI and automation are best suited for “menial or routine tasks, such as invoice generation, payment tracking and sending payment reminders.”
And that’s the key. AI can certainly handle many individual tasks. But AR is about so much more than just tasks. It’s about relationships. It’s about understanding client behavior, navigating complex situations, and exercising good judgment. These are inherently human skills that AI simply can’t replicate.
Here are some of the biggest reasons why AR professionals will always be indispensable, even as AI becomes more prevalent:
Complex negotiation scenarios requiring empathy
Marc Randolph, former CEO of Netflix, once said that “negotiation is empathy. It's almost trite to say that if you can't put yourself in the seat of the other person you're speaking with, you're not going to do well.” This hits the nail on the head as to why certain aspects of AR can’t be fully automated. The human touch is crucial in situations where preserving the relationship is just as important as getting paid.
When you’re negotiating payment terms, resolving a dispute, or working out a repayment plan, you need to understand where the other person is coming from. That means reading between the lines and building rapport—things no AI can do on its own. Even if it could mimic the words, the person on the other side of the table would rather know they’re talking to a human being with emotions just like them.
Empathy isn’t just about being nice, either. It’s actually a more effective way to approach negotiations. A study from researchers at New York University and the University of California, Berkeley found that “Revealing hidden needs and vulnerabilities can be more beneficial—often to both parties in a negotiation—than other types of justifications for requests and concessions.” This is especially important in AR, where maintaining a positive relationship often leads to better payment behavior down the line.
While AI can’t replace human empathy, it can enhance human capabilities by providing valuable support. For example, AI can analyze past payment data, communication logs, and other relevant information to identify potential sticking points in a negotiation or predict how a client might respond to different approaches. This allows AR professionals to be better prepared as they enter negotiations.
At the end of the day, negotiating effectively requires collaboration. AI can provide data and highlight opportunities, but it lacks the emotional intelligence to truly connect with clients.
Strategic decisions about payment terms
AR lives at the intersection of risk and opportunity. Should you extend more credit to a valuable client facing a temporary cash flow crunch? Or renegotiate payment terms to protect a long-standing relationship?
These aren’t questions an algorithm can answer. They require a nuanced understanding of your company’s financial position and the unique circumstances of each client. Ultimately, they’re judgment calls that require human expertise.
Where AI does excel is data-driven decision-making. Give it enough data, and it can forecast payment patterns and assess creditworthiness with a level of precision humans struggle to match.
Together, they create a force that’s more powerful than either one on its own. Think of it this way: AI is the map, and the AR professional is the navigator. AI can flag a client’s worsening payment history—the what—but it can’t understand the why behind those numbers. A human professional, however, might know that the client is experiencing a seasonal dip in sales but remains a valuable long-term partner. Armed with the data from AI, the AR professional can then make a strategic decision—perhaps offering customized payment terms—that strengthens the relationship and protects the bottom line.
Building and maintaining client relationships
Strong client relationships are the backbone of effective AR. While AI can automate reminders, track payment timelines, and even draft basic emails, it can’t replicate the subtleties of human interaction—and it shouldn't try to. Instead, AI should be used to enhance the human element.
Think about a client who claims they never received an invoice. Historically, an AR professional might have spent precious time manually tracking down the invoice, resending it, and potentially dealing with a frustrated client. AI can streamline this whole process. It can instantly confirm when the invoice was sent, track its delivery, and even provide proof of delivery.
So, instead of just resending the invoice with a generic message, the AR professional can proactively reach out with a personalized message. Something like, “I see the invoice was sent on [date], but I wanted to double-check that you received it. Is there anything I can do to help locate it on your end?” This proactive, human-centered approach keeps things moving while diffusing potential frustration.
The new AR professional
So, what does all this mean for the future of AR professionals?
While they’re unlikely to be replaced entirely, their role is evolving in exciting ways. The old image of AR—endless spreadsheets, manual follow-ups, chasing payments—is becoming a relic of the past.
Key to this evolution is a new skillset. The new AR professional will need to be:
- A data interpreter: Able to understand and translate complex data into actionable insights.
- An AI collaborator: Able to work effectively alongside AI systems, understanding their capabilities and limitations.
- A strategic thinker: Able to analyze data, identify trends, and develop proactive strategies.
- An advanced communicator: Able to build rapport, understand client needs, and communicate effectively in various situations.
- A risk assessor: Able to leverage AI-powered insights to assess and mitigate potential financial risks.
These new skills will enable them to take on expanded responsibilities, including:
- AI oversight and optimization: Rather than being automated, AR teams will be the ones overseeing automations and supervising AI assistants to ensure they’re working as intended.
- Strategic decision-making based on AI insights: AI-powered data will underpin more informed decisions about credit, payment terms, risk, and more.
- Higher-touch customer relationship management: With AI taking care of repetitive, tedious work, AR professionals will have more bandwidth to focus on nurturing key client relationships.
Humans and AI: A complementary partnership
Here’s the bottom line: a wholesale replacement of AR teams by AI isn’t coming anytime soon. However, as economist Richard Baldwin said, "AI won't take your job. It's somebody using AI that will take your job."
AR professionals have a golden opportunity to level up their skills with AI by their side. So, embrace the change, learn the tools, and be part of the future of AR.