The recent attention showered on ChatGPT, the natural- language processing tool developed by Microsoft-backed OpenAI that can reportedly mimic advanced conversations and writing tasks, was likely not lost on financial executives.
Leaders are increasingly aware that they must strike a delicate balance between supporting C-suite enthusiasm for AI initiatives while conserving scarce resources. AI’s long-term potential, however, is leading executives to prioritize it, according to a study released by tech firm Nvidia this month.
The percentage of financial services executives surveyed who said their executive leadership teams value and believe in AI has more than doubled to 64% from 36% of those polled last year, the Santa Clara, Calif.-based Nvidia reported.
In addition, 58% of respondents endorsed the sentiment that AI is important to their company’s success, up from 39% last year.
The drive for improved efficiency in companies is behind the uptick in executive enthusiasm for AI initiatives, said Malcolm deMayo, vice president of financial services at Nvidia.
The growth of interest in AI use cases – partly the result of the “viral popularity of ChatGPT” – is putting pressure on executives to step up AI application development, The Wall Street Journal reported.
The business case for AI
To be sure, beyond the new technology’s price tag, CFOs must must also keep a watchful eye on the risks that generative AI technology poses. Some IT professionals predict that ChatGPT will be used in a successful cyberattack within the year, Industry Dive sister publication CIO Dive reported.
But top AI use cases in financial services include natural-language processing and large language models; the capability to recommend or ‘next-best action’ systems; portfolio optimization; and fraud detection.
The study asserts that AI can be a tool to address economic challenges, noting that financial services firms are turning to it to “more accurately assess risk, create operational efficiencies, and reduce costs.”
Overall, nearly half of those surveyed said improved customer experience was a key business improvement resulting from AI efforts. More than 70% said their firms are building a governance and risk management framework to ensure AI systems are trustworthy and explainable, according to the study.
Cost isn’t the only deterrent
A key challenge for firms seeking to deploy AI initiatives is the recruitment and retention of talent, particularly data scientists, the study said.
From a finance and accounting standpoint, some of the most relevant use cases for AI include transaction capture and coding of transitions to a general ledger, Brandon Braganza, a partner at management consulting firm RSM Canada, said.
CFOs recognize the need to leverage AI to automate manual tasks, while minimizing start-up and maintenance costs, he suggested.
AI deployments, said deMayo, can help free up employees to perform more thought-intensive tasks.
“If you can leverage technology like artificial intelligence to automate and drive operational efficiency …[you can] elevate your people to do higher-value activities that are more revenue generating,” he said.
Understanding the specific use cases for AI and the estimated return on investment are critical to help CFOs balance the need to support their colleagues while mitigating risks.
“CFOs continue to be charged with providing data-driven insights about the business to leadership, while simultaneously ensuring stewardship over the integrity of financial statements and safeguarding of organizational assets,” said Braganza.