Latest / Stronger Business Together / E31 Automate Your Accounts with Myles Arnott

Transcript

E31 Automate Your Accounts with Myles Arnott · Stronger Business Together

• Granger Forson: This is the Stronger Business Together podcast where business owners learn from other business owners. No theory, no gurus, just real journeys and overcoming real hurdles. Today I'm joined by Myles Arnot who runs Full Stack Modeler and like any owner he's in that middle of building things, fixing things and growing something that really matters to him. So Myles, welcome. Myles Arnott: Hi, Granger, thank you very much for having me on. Granger Forson: Brilliant! So let's jump into Act 1 now, your business. So in plain English, what does your business do? Myles Arnott: So yeah, so I've got an interesting one actually. So I run Fullstack Modeler, I'm a co-founder of that company, which is a, it's actually a training business where we train people to use Excel properly. So typically finance professionals and how to use Excel. But alongside that, I'm also a fractional finance director. So I work with small and growing SMEs, kind of the three to 5 million turnover size to help them scale their finance department ready for scaling their business. So a bit of a two hats, one running my own training business. and the other doing Fractional Finance Directorate. Granger Forson: Fantastic. Yeah, two very interlocking skills as well because I know many finance teams adore Excel and use it to amazing skill sets, etc. So yeah, fantastic. So, who do you love helping then and what are they typically dealing with? Myles Arnott: So the key for me is when you're looking at a fractional finance director role is understanding the business that you're looking at. So I had a call this week in fact with a potential client. And for me, the sweet spot is someone who's in the probably three to five million turnover. They're looking to scale. They've got enough understanding about finance that they understand what finance could bring to the business in the future, but need help doing that. And that's what I'm looking for. And then I also look for the same kind of morals and values. that I have to make sure it's the business that I'd really love to work with. And that's the general theme that I have is a company where the owner is financially astute, but just needs support to take it a bit further. Granger Forson: Yeah, fantastic. Yeah, no, totally understand that as the business gets bigger, the controlling of the money, the organization of where everything goes, are we profitable? What's our cash flow gets more complex because you've got more products, more services, more people, more salaries, more tax So many more things come into that pie that have to be organized as you grow and scale. yeah, fantastic. Fractional FD really important. So, you know. When did the business start? What was their original spark? Myles Arnott: Oh, yeah, again, it depends which business for me, in fact. So I set out on my own in 2008. So I found I was always staying in the business for about two years. And then I just found that I would move on. And I realized that I loved changing things. So was in finance, generally kind of doing reporting, analytical roles. I would change everything, get it running, and then was looking for the next challenge. So 2008, I set myself up as a consultant. So financial transformation, spreadsheet work as well. and then got into the training and then full-stack modeler. set up with my business partner, Giles Mail, about five years ago. And that was in SEMI in reaction to COVID, which was to take some of the online, the in-person training that we used to deliver and move that online. So full-stack modeler is an online delivery of our kind of core training that takes you from basic Excel through the core skills up into financial modeling and visualization. So. we wanted to put that journey online and then we can mix that with a hybrid approach of in-person and online. So yeah, so started originally on my own back in 2008 and then yeah, full-stack five or six years ago. Granger Forson: Excellent. Online training, developing those skill sets, helping people visualize the financial information. I love that. Fantastic. So what does the business look like today then in terms of size and shape? Myles Arnott: So full-stakes actually is a really lean machine. we keep, we purposely kept it lean. So one of the things that's interesting as a fractional FD or any anyone in finance is that like, do you, what are you trying to do? You're trying to maximize profit rather than necessarily maximize revenue. So I know for some people, maximizing revenue is important if you're looking for a sale, for example, but in reality for me in finance, there's fairly obvious things to say, maximize profit, maximize cash position so that you're. nice and stable. So for full stack, we keep it as lean as we can actually. So it's an online platform. We've got to run it with a small team. The main focus of a lot of our work is actually like marketing, like a lot of energy goes into marketing because you're trying to reach out into the world and get people to be aware of you. The actual operational element is pretty straightforward. Giles and I have trained Excel for all of our careers. So like we're very good at doing that and our content takes people on the journey. So So nice lean and that's something I talked to founders of businesses a lot about is like when you're looking to scale, what are you trying to scale? Are you scaling revenue, profit? Now you can grow your revenue enormously and end up with less profit if you're not careful. So yeah, so we purposely kept Granger Forson: No problem. Yes, very true. Myles Arnott: it lean. That was one of our guiding principles when we set up. Granger Forson: Fantastic, yeah, I totally agree with that. You can scale the wrong thing, think you're doing things really, really well, but actually the bottom line isn't happening. yeah, don't go forwards with that, definitely. So, awesome. Well, why do customers then pick you? Why do you delight them? Myles Arnott: That's an interesting question. So I guess Giles and I have been doing this for a very long time and we've both modeled in real life as well. So we have like both B2B and B2C customers, so direct consumer, albeit they're in finance as people that are working, but they pay for it themselves. And then we have B2B customers who engage us to train their team. So two slightly different angles, but fundamentally we take... people on a full journey. So very often with Excel training, you'll learn pivot tables on its own or your loan charting on its own. Whereas our course is an entire journey and you're being taught by finance professionals who have trained this forever. Giles, my business partner is an MVP, which is a Microsoft Most Valued Professional, if you've ever heard of that. And he's also an MFM, a Master Financial Modeller. So between the two of us, we've got the kind of background of what we've done for our entire careers. We've lived and breathed what these teams are facing on a daily basis. So we really come at things knowing what they're facing and therefore alongside the recorded training, we can really help people through that journey. And I think that's what they look for, that full journey, which is why it's called full stack modeler. Get everyone the full journey rather than bits and pieces. And then our background, which allows us to really focus in on what they're trying to do. So it's not just here's a function, it's what's your problem. How can that function help you to resolve that problem? Granger Forson: Yes brilliant yes I like a good function in Excel yeah Myles Arnott: Yeah. Granger Forson: very much very much so I've done some interesting modeling and activities, not in finance, engineering in my past. yes, I can fully appreciate that. But I like that structure that you talk about because you've got you brought to Excel training your experience. So actually, it'll help the finance team really understand how to actually use Excel and the structures and the formulas and the outputs rather than just generic training in Excel. So awesome. Really good. You've talked about marketing already. how do you generate leads? Myles Arnott: Yeah, marketing is probably the hardest thing we've We're two accountants, two accountants and trainees. And as an entrepreneur, you have to wear every hat. And so as a business owner, you wear every hat of the business and some you're better at than others, let's be honest. So marketing is probably our biggest challenge. We've been trying the best we can over the years. We predominantly focus on personal brand. we focus on mine and Giles's personal brand and that because we center that in We know what we're talking about with good trainers. People find us through those profiles and then hopefully come in and enjoy our training. Outside of that, we're trying all the different channels that we have. We've taken a slightly different approach to marketing. when we looked at the market, we thought it would be interesting to do something really different. we've done like a big, we've done two big music videos. So we've actually done like music videos about being an MVP. which you can find on YouTube. Giles has a brand called the Humble MVP. So we make a bit of a joke about the fact that he's a of an idiot really. And he's obviously not, but that's the persona if you like. So it's a bit of a silly persona. He does a bit of rapping and stuff just to make it a bit different. So it's not just straight down the lens kind of marketing. And then yeah, through that, we try to mix that up. then clearly for us, then it's very important to be really clear that we actually know what. talking about and we just do that for a bit of fun. But it's been really entertaining doing all of that stuff like to sit and make a big video like it was a big video that we did the last one. And Giles has done some music that we've been using for a few things. So like the Microsoft Excel World Cup and Giles wrote the theme tune for that. that's gone fairly big as well as big as an Excel World Cup can go. So we're just involved in a lot of different areas, try and make it a bit of fun. try to bring something a little bit different just to try and cut through a little bit. it's like Excel is an amazing community of people. It's one of the things that I've really seen the community aspect of Excel is genuinely incredible. And as you build those relationships with people, some of the things just come naturally because you get on so well with each other. So that Granger Forson: Yeah. Myles Arnott: kind of word of mouth or relationships starts to build. Granger Forson: Wow, so many different ways. But what I like about that, sort of alternative way of doing it, that standing out in the crowd. And that's actually really important. You can do wacky and things because people will then start having a look When they look at you, then you can then show how serious you are and be able to do that. We have to stand out Myles Arnott: Yeah, we did. Granger Forson: in that crowd. So love it. Fantastic. So what are you aiming for the business in the next 12 months and why? Myles Arnott: It's just kind of holding through. So we're in an interesting period where AI is impacting everything, literally Granger Forson: Hmm. Myles Arnott: everything. And in finance is having a big impact and people's, I guess, people's perception is that, do you need Excel training? Should you focus on AI? Are we going to need Excel in five years time? So for us, it's about holding steady, focusing on some of the copilot changes that have come through, just making sure we're aware of of how that can be applied across the various tools that are there. And yeah, just kind of holding for and then obviously just slowly building the business up. Because we keep it lean, it just means that we're able to focus on quality of delivery and relationships that we're building rather than having to just constantly churn to meet our overheads. So being lean allows us to have that flexibility as co-pilot and AI generally exists. we can start to pivot on that a little bit and bring that into our content. So it's a really nice, lean dynamic that we've got at the moment that allows us to do that. And then, yeah, just slowly grow the business, see where everything's gonna end up, because I've got no idea, I don't think anyone does, where this will end and what it will look like in a year's time or even six months' time. So luckily being lean allows us to be really dynamic and flexible to jump around that. Granger Forson: I really like that understanding of the world is changing. It's changing probably faster at the moment than we've seen. So just taking that one step at a time, seeing what happens, learning and growing as you go along. Really, really exciting future. So let's move on to act two now, the journey of your business. Building a business, there are highs and lows. There are times when it gets really hard or tough. What have you learned about yourself and about your business when things have got tough? Myles Arnott: Yeah, great question. Isn't it? It's such an interesting one because having or being a fractional finance director actually running your own business really helps because it's one thing to be sat there advising an owner with your finance, like detail and what you know and what you should say and what you should do and what you should look after. But when actually you sat in that seat and, you know, let's be honest, full-stack modeler isn't a five million pound business. It's a smaller, smaller thing than that. but I've still been through some of those experiences that the people that I work with go through from time to time where things get tight and things get difficult. So yeah, through the journey through the last five years, as always, we've had ups and downs. And for me personally, just, it's been that experience of living some of that. So living some of the things that the owners of businesses go through, experiencing that, it's helped me. appreciate how they felt and that makes me, I guess, a more empathetic about the experiences they have. And yeah, just like all of these things are great opportunities. The good and the bad is just constant learning, I think. that's even coming up to 50 this year, even at 50, I'm learning so much about myself and about business and about running a business. So, yeah, interesting times. And I'm sure it will continue to be interesting, particularly now with, like I say, the way our AI is hitting. trying to understand what things will look like is kind of fascinating. Granger Forson: Hmm. Yeah, no, I totally agree. I'm 57 and I'm still learning and enjoying the journey all the time of building the business through the highs and lows to make it successful. We have to make decisions in business. We have to decide what to do at times. What's maybe one or two decisions that you've made that's changed the trajectory of your business? Myles Arnott: I think the marketing is a good example. I know we just talked about that to some extent, but that decision of set like kind of sitting back and saying, how do we cut through here? And we made a really big pivot, which was to push on Giles's profile and say, right, let's, let's do something really interesting with that. And that was quite a pivot from where we were and was a big decision for us. And we invested a lot in marketing at that point to try and really push, push that through. And from our perspective, that's worked, worked really well. And then probably the team thing. So as we were starting to grow the business, we started to do that natural thing of growing the team. And then again, we took a step where we just kind of looked at everything. Actually, I said, we should just lean this up. Let's just do it as tight as we can. And so I think those two were probably the main things, like leaning up the business and then focusing on the different marketing. And I think AI is an interesting piece, possibly in both of those actually, because You can use AI to generate some of the interesting content. You've got to be a bit careful because it looks so AI. But also then from a team perspective and a lean perspective, we're obviously starting to look at how we can use AI within our business to try and lean things up further and see where it can help us with some of the processes that we have. So I use AI daily, but for me personally, it's mainly around the word side of things, as in like wording rather than. necessarily processes and numbers at the moment. But numbers and process side is something that I'm really interested in. But at the moment, it's so helpful for reviewing documents and all that kind of stuff. But we're looking strongly at how we can use it within the business to keep on making things even more more lean as we go forward. Just so that we're growing the business without having to necessarily grow the cost base, which is everyone's dream, I think. Granger Forson: Yes, yes, absolutely. Some of the reports that I've seen recently about big, big businesses that using AI, they're actually getting to the point where the cost of AI is now more expensive than actually recruiting new people. I thought, wow, so they're doing something wrong or they're doing something we don't understand because that's totally logical to me. But anyway, Myles Arnott: I it's facing into the reality of this stuff actually, which is the hype was everyone's losing their jobs, particularly in finance. You don't need accountants anymore. Everyone's disappearing. I think there's also a point that businesses have invested in the software licenses and not necessarily in training around the tools. So they've Granger Forson: Yeah. Myles Arnott: kind of gone big on we're doing AI, right everybody use AI. with no real guard, or no guard rails, that's probably too broad a thing to say, but with not the guard rails that you need. And now they're feeling the hit of the cost. And you can see it in the news that companies are starting to back off some of the AI usage. And that's the problem of hype. I think it's that hype just forces us into this FOMO situation. So fear of missing out on what AI is going to give us. So people just leaping in. And I don't think people would do that in a normal situation. And I think people just need to take a little pause, do what they were doing any other piece of software and say, well, do I need this thing? How is it going to benefit? What's the return on investment? How do I control it? How do I train my team? All of those really obvious things that we should say. just need pay attention. Granger Forson: All those things that absolutely, with any technology, it's all of those key things you have to get right. Totally agree. I know we're going to have a conversation on AI and our hurdles, so let's move on a little bit for now. Evolution of the products that you've sold, what's changed over time with your products or services, and why did you make those changes? Myles Arnott: Yeah, another really interesting question. So Excel is like an evolving beast. So Excel changes itself over time. And particularly back in around about 2019, there was a huge amount of new content produced as they released the dynamic array engine, which allows you in Excel to work with arrays and array based modeling rather than just cell based. So when that came out, there was like an explosion of content within Excel. that kind of got us fairly active because we were having to keep up with that. and deliver it. And over time, things that even things that have been around for a while, the way that people use them or the evolution of the tool still keeps us lively in terms of how content is being used. So there's always a bit of an evolution there. And then obviously most recent thing without constantly talking about AI is like the release of copilot and AI and stuff. Granger Forson: Yeah. Myles Arnott: So that's always keeping us going. But behind all of that is how we train, how we deliver the content, how we present the business. to the wider audience. So the core training itself, like the way that we prepare our workbooks and the way we deliver things hasn't fundamentally changed. I guess over time you get better at recording things and there's better software to do stuff. So we've re-recorded content in the past. Quite recently, JAR has re-recorded all of our financial modeling content to align with the Financial Modeling Institute's way of doing things. So again, content that was there already, but we just redid it to bring it up to speed a bit, brought in some dynamic arrays, focused it on their advanced financial model, course. So you can't stand still with anything. You can't just go here's a product and we're just gonna use that forever, particularly something like Excel and modeling, which just constantly evolves. So we're always doing that. And the way you build online training then becomes really important because you need to make sure. is a way that you can flex it without having to rentire it. So we have like a full end to end course. So we need to make sure we build that in a way that doesn't mean we have to rebuild everything every time a small things change. One of the hardest things, something that's really interesting around AI and Copilot is the proportion of change within that tool at the moment and the speed that it's changing is almost impossible to record content. for Copilot Granger Forson: Hahaha. Myles Arnott: at the moment because within a week it looks different. So that's Granger Forson: Yeah. Myles Arnott: definitely keeping up with our toes on how we deliver that. And we're focusing on live delivery at the moment just because it's so, so changeable. Different people will have different access like one day to another on a live session, things can change. And that's also true in Excel. If depending on what 365 license you're on, I can be training someone who has a totally different view of Excel. Something could be slightly different to what I have. And that's very different to back. If you go all the way back to 2008, when I started, I would turn up on site with my laptop and three disks. So I could decide which version of Excel to put into my machine. So I'd have to set my machine up for the version of Excel that that team had. Now almost everyone's on 365, but people are on different releases. So it can be a little tricky. Granger Forson: Okay, well, yes, it's such a pivotal change really as the technology that you're using, Excel has changed, you've changed and updated your products. mean, you know, dynamic arrays, did you call it? Well, that's well beyond my Excel understanding. So yeah, something new and exciting to go and find out about. But you've you've talked about people and you know, stronger business together, we believe in growing your people so they grow your business. What have you learned about growing people? over the years of your business that maybe you wish you'd known earlier. Myles Arnott: Yeah, I think it's probably worth me focusing on the fractional finance director side actually, because that's where I'm typically nurturing someone through a position, whereas at Fullstack, we're a lean team delivering something. So within the service that I typically provide as a fractional, I tend to take a company from having a bookkeeper through to like an internal bookkeeper, financial controller, and then myself as FD, and then potentially replace myself with a head of finance, for example. And in that journey, I've really enjoyed the process of working with the finance assistant or bookkeeper and the financial controller and mentoring them through the way that I like to work and, you know, bring them up through their skillset. And my, my goal is always to replace myself. So as a fractional finance director, if I bring a financial controller into the business, for example, I'm looking for someone that can become. or can move up into my role eventually. That's what I'm looking for them to do. And then my job is basically to get everything set up so that I can effectively move away from the business to some extent so that that financial controller can run most of the business without me. And I think the biggest thing, so I'm quite an introverted person as a youngster, I was quite shy and introverted and... And what I've realized is that actually I love working with people. And so it's not a lack of people skills. It's just like a natural quietness, I guess. And what I've learned and I guess what I wish I'd known when I was younger was just how much I enjoy working with people and spending time with people and helping to develop them, which young me would just never have believed that. I young me would never believe that I was a trainer as well, but I was such a quiet person and at the time would never have thought that I could manage people and... bring people on a journey and then train people as living. Granger Forson: Brilliant, brilliant. What a fantastic answer. Yes, I love that. That journey of developing the people that you're helping to be more successful in the business as well. So awesome. So let's move on now to Act 3, our hurdle that we're going to discuss. So what have you brought us, our topic for conversation today? Myles Arnott: So I thought it'd be interesting to talk about AI within the finance department. And finance department is a wide ranging piece, but I thought it'd be really interesting just to dig into what that looks like, what the hype looks like, what reality looks like, and then just try and explore it a bit with you Granger and see your perspective Granger Forson: Yeah. Myles Arnott: and have a good chat around. Granger Forson: Absolutely. let's build an image of a business that we can talk about. What sort of size business are we going to talk about? What's their sort of product range, do you think? What would we, without sort of Myles Arnott: Yeah. Granger Forson: picking anybody specifically, do you know? But let's just have something that we can anchor this conversation around. Myles Arnott: So I was thinking something like quite an interesting finance department. So something that's got a bit of a mix going on. So I was thinking something like a craft brewery where you've got production, you've got sales to individuals, sales through a website, sales to other businesses. So either like big pub chains or corner shops, tap rooms Granger Forson: Yeah, distributors. Yeah. Myles Arnott: where you would be selling your beer as well. So a real mix of outlets, manufacturing as well. which then creates quite a complex finance department and probably like five to 10 million range. So you're in that kind of relatively early stage, not at the ERP level yet. So everyone I work with, for example, is pre ERP. So typically using zero for their Granger Forson: Yeah. Myles Arnott: accounts, that kind of, I guess, simpler, I guess I'll call it that simpler, but smaller team Granger Forson: Yes. Myles Arnott: is the kind of area where AI is really going to help a small team to develop. So I thought that'd be quite a nice use case. Granger Forson: Perfect. That's a great, great sort of business that we can really sort of start to understand. So typically today, from your experience, how many people would they have in their finance team today and what sort of positions would they be holding? Myles Arnott: probably two to three. So not many is the reality because at a five million turnover for that kind of business, Granger Forson: Yep. Yep. Yep. Myles Arnott: you're not looking at huge numbers in that. So a bookkeeper, in-house or outsourced. So depending on the business, you get to, I quite favor the outsource model personally, because up to a certain point, it's just really flexible and the means that. Granger Forson: Yeah, Myles Arnott: You don't have someone going on holiday and all that kind of stuff, but there does come Granger Forson: I agree. Myles Arnott: a point where you need that to come back in-house because of all of the in-house knowledge and relationships that you need. So it's quite a fine balance that one. yeah, bookkeeping. So all of that core stuff is covered. Someone has a financial controller, either full-time or part-time, depending on like size of the business and what's needed. And then either like a fractional finance director or potentially a head of finance. So three, probably. Granger Forson: Okay. Myles Arnott: Some people would have less, some people might have more. Granger Forson: Perfect. So we've got a really good understanding. But let's put it from the point of view of the business owner. He or she, they're trying to grow the business. What is probably not being delivered out of the fan out team that they probably don't realize they don't know yet? Or they probably have an inkling, but they don't have that structure yet to see it. Myles Arnott: Yeah, I think it's more about where they're struggling. So typically like most finance teams, they know what they're trying to deliver, particularly if you've got like a strong financial controller, strong FD like fractional full time in there, they're to know what they need to do. They need to do a budget, a reforecast, they need management accounts, they need a cash flow forecast, they need core processes that work well, strong controls. I think most people know what they need, but the reality of trying to do that across a complex business with thousands of transactions, lots of employees, people who work part time, know, manufacturing and in pubs, like credit card Granger Forson: Yes, full. Yeah. Myles Arnott: transactions going through like all over the place. There's so much noise and yet there's two and a half or three people that are trying to run all of that and provide not just the basics of finance. Cause one of the, again, one of things I focus on is It's very well, you have to do the core finance, but actually for me, finance is a value add. So it's not about Granger Forson: It, yep. Myles Arnott: doing the basics, it's about how can we add value to this business? And very often that's if you're overly busy with work, that's what typically struggles because you have to do your core and then you need to free up time to do the value add. And that's where we can maybe use it. Granger Forson: And the value add is the information that the business owner the person, the team, the leading the change or the scaling up, there's that real information to actually make decisions and understand, you know, that ability to create the models to say, if we did this or where are we not making sufficient margin? Where's the profit failing within the different structures of the business? You know, is it in the taproom? Is it somewhere else within there? Are we making enough? Do we need to increase volume through one of our vendor types to actually make it bring up the margin and to change what we need to do. it's that. information that you need at your fingertips to start playing with those conundrums which yeah most finance team probably as you say don't have the time to be able to bring forward at their fingertips to be able to do that often it's let me go away and do some modeling i'll come back in a month's time yeah because i've still Myles Arnott: Yeah. Granger Forson: got the day job to be able to do yeah so so we need that information because you know we often wonder what is the power of a finance team well actually it's that it's the real clear information that helps us make not make the decisions but help us back up and understand where those decisions. So along comes AI. What's AI going to do for us initially? What's that original hype and idea? Myles Arnott: I mean, the hype is you no longer need a finance team, which is kind of hilarious. And you Granger Forson: Yes. Myles Arnott: can create a financial model in five minutes and you can, I've seen, I've gone to a few sessions where they're recommending that you create a cashflow forecast every week from scratch using a prompt. And you just like generate the whole thing from scratch each time in five minutes. just kind of layer it over all of your reporting. don't need any kind of finance people because all of this will just be done for you. And clearly, I think you can probably tell by the way I'm saying it, I don't really believe in that. So that's not a reality. Granger Forson: Absolutely yes. No the reality. So what's the reality that a business like this, our craft brewing example, what are the things that are going wrong with AI for them then as you've got some experience of working with all types of businesses and implementing? What are they getting wrong? Myles Arnott: Yeah, think it's a lot for lot of people. The reality is not a lot of people are actually trying it because they're quite scared and they don't quite know what Granger Forson: Yeah. Myles Arnott: to do. But the hype says that everybody is doing it, which just isn't. Yeah. And so people feel like, well, Granger Forson: Everybody's doing it. Yes. Yeah. Yeah. Myles Arnott: I'm kind of out of the loop here. There's also this weird concept that everyone now should be able to create their own agents and like run processes. that you've generated automatically, which again, we would never have said that about anything else, but all of a sudden everyone in the entire business, not only in finance, should be able to create these things. And then we should Granger Forson: You Myles Arnott: trust that they run and do the thing that they think they've done, which to me just feels like the wrong approach to particularly finance where everything has to be accurate. So it's not necessarily they're doing it wrong. It's maybe that they haven't got started or they've tried. Again, if you don't train people and... you just give them the tool and you expect them to use it, they may well start to use it, then get frustrated, then give up and then go back to how they did it before because it's just too much inertia. If you can train people how to do it properly. And again, something we haven't talked about is getting your data right first. You have to get all of your information, that core Granger Forson: apps. Myles Arnott: data layer right first. Cause otherwise you're putting a Granger Forson: and Myles Arnott: sticky blaster over a rubbish. No point. Granger Forson: And I totally agree. And that's where I thought we were going to maybe start, you know, because there are the true things that probably we get wrong today. First of all is our data set is wrong. I don't mean before AI, it's just mean. today. And the other thing is understanding our process and Myles Arnott: Yeah. Granger Forson: controls. Yeah, because if we don't have good processing controls in place, a how do we train new people? But B, how do we get that repetition to ensure that data structures right when the data is then right, then we can build from it. And from from our experience of using AI within our business and through some of my clients, it's that starting first of all of, as you said, this is a new piece of software, not not something that's going to replace stuff. How do we build it over time? And more importantly, How do we train it? How do we onboard it? How do we treat it as an employee? And it was that aha moment for me, which I saw about a year ago on the YouTube video, where they actually explained treat it as a person, treat it as something you train. So there are boundaries that you need to create for it. There are structures that it can and can't do. You need to evolve it and train it and tell it where to get better, how to improve. We think because it's a computer, it'll be right first time. It's not. It's a dynamic. model that is pulling together answers based on what it thinks, inverted commas, whatever thinking is in AI, as an output you want based on the prompt or the action that you've done with it. And it's that evolution, if you learn how to develop it and make it better, it becomes better and better in your organization, especially within any organization that has repetitive activity, just like the finance team. Myles Arnott: Yeah, I love the analogy of the kind of new joiner or graduate. And I've had a few people calling it like a naughty graduate or a graduate that Granger Forson: Hahaha. Myles Arnott: will confidently tell you they've done it perfectly. And actually in the background, it's a disaster. And it is the reality that some of the hype has told people that you just press the button and whang everything's done. And the reality is exactly as you said, Granger, you just need to treat it with care, review what it's doing. and work through and the fact that it's a probabilistic model therefore leads to things that aren't perfect and people just need to understand that and work with it in that way. And again, as you said, work with it as a co-pilot, which is why most of the tools are called co-pilot rather than Azure pilot and just say, off you go, go and get on with it. So you just Granger Forson: Yeah. Myles Arnott: need to treat it with a bit of care and respect for what it actually is rather than what the hype has told you. Granger Forson: And also when you're setting it up and you're starting that development of it, something I learned within Claude, which recently has come to GPT, is this ability to teach it, tell it where not to do anything. So it's important to have the negative cases. So if you don't know this, don't do anything, ask me. If you don't know this, do not do an output. If this happens, then don't do anything, report it. So actually it's as important within AI because we assume computers say no, computers say yes, they do the things right that we tell them. But actually, just like anybody else, it's the things that won't work that we actually need to tell it and give it those boundaries and understandings from it. That's one of the biggest learnings I've done in the last six months of understanding how to build better agents and structures of them. It's not just about what to do, it's what not to do if you don't have an answer in the structures of it. Myles Arnott: Yeah, absolutely. It's the guard rails that you put around it that kind of box it off so that it can't go off and do the same thing. And we're, we're kind of looking at a tool or a number of tools actually where we can work with software that actually contains the AI so that you've got some interface which really guard rail it. So it can't go and do its own thing. And it's been really interesting talking to the developers of that where they've set up a firewall and then they've watched AI, like, try to navigate that firewall and make its way around it. So that's kind of terrifying. So, really interesting. And I find the whole thing fascinating. I'm trying to use it as much as I can, but also just try and be sensible about it and treat it as Granger Forson: Yeah. Myles Arnott: anything else that you would bring into finance, which you're not just going to throw in with kind of abandoned and no control. Granger Forson: Yeah and I think that's the key thing here that people are sort of tackling it as something brand new. It's not. We have... decades and decades of experience, people understanding how you implement technology into a business. We have these plans. This new technology will achieve this for us. Fantastic. How are we going to implement it? Well, OK. There are some brilliant processes and structures to make that happen. And that's the same with AI. It's just a new piece of technology. How will we make that happen? So one of the key things that we've done with our business is we talk about the right to auto mate. So, and something that I learned from Toyota many years ago, and you I'm, you talk about lean, my background is in lean manufacturing Myles Arnott: No, okay. Granger Forson: and lean software development as well. And I was at a conference and Toyota talked about within their IT department, when they develop software, when a team requests it, they go and work with the team, two or three of them go and work with a team and they do a Kaizen event and they improve the process. And only if they can improve the process by over 50 50 % will they then consider even automating it. So we've got to improve what we do first physically the way that we manage and then we'll automate what's left and they introduced that concept to me, earn the right to automate and we have the same in our business. We constantly improve a process, improve it and make it reduce it, make it smaller, make it simpler, make it faster, make it beneficial and then we then say what's left? Could we automate? Automation through AI is a lot quicker than previously the way that we used to automate things. So it does help us speed up when we want to automate, but we only automate what's left. And I think a lot of businesses are typical when they're thinking about technology change. They're thinking about how are going to remove people from the process? How are we going to make ourselves more efficient? Actually, efficiency is a byproduct of simplifying what you do today and making it better. If you do that first, actually what's left is so much easier to actually automate. Myles Arnott: Yeah, I love that Granger. Like, yeah, everything you just said really resonates. I love that. Yeah. Some of the phrasing in there was, was awesome. Yeah. That really, really resonates with me. And it's kind of the opposite of what we're seeing, which is people just see AI as a, as an excuse not to do what you've just described. And so they see it as an experience just to throw this thing on top in their minds. It's free for some reason, because we all think AI is free. Just throw this free thing over the top. It will resolve all of the problems that we've got and nothing will go wrong. Whereas what you described is the perfect example of what people should do. Do things properly with governance, fix it first, fix your data, fix your processes, and then exactly if necessary, put either automation or AI. So I try and differentiate between the two as much as possible as you would as well. But Granger Forson: Yeah. Myles Arnott: a lot of people seem to confuse the two, but yeah, like deterministic automation or AI with automation if you need that decision-making angle in it. Yeah, I Granger Forson: Yes. Myles Arnott: love that Granger, that's a nice way putting it. Granger Forson: Yeah, and AI is a fantastic tool to experiment, to apply, to even ask it how you would simplify this process. What would you do here? How could we do this faster? It can be a fantastic coach. It can coach you to do things. Gemini has coached us as we set up our business last year. It's coached us how to do SEO. We don't need brilliant SEO. We're not a big business. We don't need that full. But it's coached us how to do that. It's coached us how to do demark policies on email systems. It can be a fantastic coach as well that can take things. There's so much more that AI can do in a business. And we're just thinking, well, it needs to speed things up, need to replace people, need to reduce costs, but actually it can be a fantastic tool that enables your people to improve the process, to change what we're doing, to make it better, to make ourselves more lean. I love your expression from that. Myles Arnott: Yeah, and think that's what's missing from a lot of the, of what people put out in social media, I guess, because it's probably not that exciting as a topic, but it's actually the thing that Granger Forson: It's not. Myles Arnott: makes the difference. So for me, it's the, it's the nitty gritty, the things that you're doing on a regular basis that just suck up your time aren't really a value add, but they're also not very exciting. Those are the things to put AI on top of rather than once a, once a year I do this budget model. as a three statement financial model, they're like, wow, let's automate that. Let's not focus on that bit. Let's focus on the thing that one of my team does every day for three hours. Let's automate that Granger Forson: Yeah. Myles Arnott: bit and then we can sort it out and it will save everybody time. That's where the benefit of AI. Granger Forson: And as I said, you may not need to automate it. You could potentially just… AI could coach you to simplify it, to change it, because it can bring in those different outside thinking, which maybe we can't afford, but actually is locked there in AI that help us to find those alternative ways of working, which eradicate all those processes. We talk about reduce it by 50 % in time and 50 % again and 50 % again, and ultimately could we eliminate it? And that's the sort of main mindset that helps do it. But that's my lean background, but that's really what we should be using AI for. AI for, make things faster in a business, make things simpler in a business, use it as a coach, use it as a mentor as well as just something that's going to replace people. Myles Arnott: Yeah, absolutely. And the coaching is the kind of coaching concept or the co-pilot is how I use it the most. So I'm aware that I've built models and spreadsheets for like 30 years. So for me to use it to do any kind of build just doesn't seem to make sense to me because I can do it myself and I'd rather build it and then help ask it to help me check it. But where I'm really feeling the benefit is as you said, like a coach or I've created some training documentation, like review it as if you're one of the attendees, the person who commissioned it, an Excel trainer, all those three personalities review it and give me your feedback. And, and what it comes back with, you said about giving different perspective is one of the things that I value the most is it comes back with things that I just would not have thought about. And now like, for me, AI kind of got interesting around November time. Now it's unbelievable what it brings back because you read what it said and you say, yeah, I, I completely agree with you. That's actually done a really good Granger Forson: Yeah. Myles Arnott: job. Whereas like back in maybe October last year, you'd be like, thanks for the note. Granger Forson: Yeah, I really agree. It has taken that whole new level to be able to do that. Well, Miles, fantastic conversation about AI. Let's move into our wrap up and close now because we've run out of time. So what did you hear yourself say today that maybe surprised you? Myles Arnott: wow. I don't know. There was anything, Granger, actually. I can't think of anything that surprised me as we were talking along. It was kind of interesting getting into some of the, I guess, when I was younger stuff, because it's not something that comes to mind and things like that come out when you're talking in a conversation. And I guess talking about when I was younger and the fact that I wasn't necessarily that confident and how I like to work with people. So something that I probably don't think about that often because I'm so focused on processes and getting on with systems and AI and stuff. It's nice just to have a bit of a chat around the people side of it. And I guess my evolution with that. So yeah, that's probably the bit that was interesting from the conversation from a, hadn't really expected to get into that too much. Granger Forson: Fantastic. Thank you for your honesty. So Miles, how can people find out more about you if they want to follow more of your journey? Myles Arnott: So probably best on LinkedIn. So my name is Miles Arnott. There's not many. I think there's like one other in the world that's got my name. So I'm quite fortunate with that. So yeah, if you Google me, you'll find me all over the place on Google. I'm on LinkedIn. Love to connect with people, particularly finance people going through the same kind of journey as me, but anyone who's interested in AI, interested in finance, interested in spreadsheets and stuff. So anyone in that kind of world, really, well, anyone to be honest, but really welcome to join and hook up. love. chatting to people and just understanding what they're trying to achieve and help them move through things and also to learn from them because whenever you have a conversation as we have Granger, we both learn from each other, we? And that's what life's about. Granger Forson: We do indeed. that's purpose of this podcast is to learn from each other and help others through our conversations as well. So, Miles, thank you so much for being open and honest today. I know our listeners will get a lot from this conversation. It's been fantastic. Thank you. Myles Arnott: Thank you, Graeme. And again, yeah, thank you for inviting me on and I've really enjoyed the conversation. It's been great. Granger Forson: Thank you for spending your time with us today. We're on a mission to make business owners stronger together. If this conversation has helped you, please like, comment and follow on whatever platform you're using. About 60 % of our audience hasn't done this yet and these small actions will help us reach more business owners just like you. If you'd to join in the conversation as a guest or if you have a hurdle question for us in a future episode, do reach out to us at info at strongerbusinesstogether.com. Now, Go make this next week really successful and we'll see you next time. Cheers!