- Two-thirds (66%) of banking and financial markets CEOs
surveyed said that the potential productivity gains from AI and
automation are so great that they must accept the risks to stay
competitive.
- 65% of financial institution leaders say that succeeding
with AI will depend more on people's adoption than the technology
itself and 60% recognize they are pushing for AI adoption more
quickly than some might find comfortable.
- Half (50%) of financial services CEOs surveyed say they are
hiring for generative AI-related roles that did not exist last year
and 53% indicate they are struggling to fill key technology
positions.
ARMONK, N.Y., June 5, 2024 /PRNewswire/ -- New findings from
the IBM (NYSE: IBM) Institute for Business Value revealed that
banking and financial markets (BFM) CEOs are facing workforce and
culture and challenges as they act quickly to implement and scale
generative AI across their organizations.
The findings are part of an annual global cross-industry
study that surveyed more than 3,000 CEOs from over 30
countries and 26 industries, which included 297 BFM CEOs
representing retail, corporate, commercial and investment banks and
financial markets.
The survey found that generative AI is perceived as the key to
unlocking competitiveness. 57% of BFM CEOs surveyed stated that
gaining a competitive advantage in the sector will depend on who
has the most advanced generative AI.
The findings also revealed that CEOs are navigating complex
issues around culture in the era of AI. 59% of surveyed BFM CEOs
stated that cultural change within a business is more important
than overcoming technical challenges when becoming a data-driven
business, with 65% also believing success with AI will depend more
on people's adoption than the technology itself.
Despite this, 60% of surveyed BFM CEOs say they are pushing for
AI adoption more quickly than some employees might find
comfortable. Yet 43% acknowledged that their employees do not fully
understand how strategic decisions impact them.
Skills also proved to be an area of focus for the CEOs. While
60% of surveyed BFM CEOs say their teams have the skills and
knowledge to incorporate generative AI, more than half (53%) of
respondents say they are already struggling to fill key technology
roles. In addition, 50% of these CEOs said they are hiring for
roles that did not even exist this time last year due to generative
AI, showing the rapid shift occurring in the workforce.
"Our research reflects the tremendous pressure CEOs are under to
keep their competitive edge. Alongside profitability and
productivity, getting the right skills remains a persistent
challenge, with CEOs now hiring for roles that did not exist until
recently," said Shanker Ramamurthy, Global Managing Partner Banking
& Financial Markets, IBM Consulting. "Workforce needs are
shifting rapidly in the financial services sector and CEOs must
ensure that upskilling programs are prioritized as an important
element of any financial institution's enterprise strategy for
scaling generative AI."
In addition, 66% of BFM CEOs surveyed stated that the potential
productivity gains from automation are so great that they would
accept significant risks to stay competitive, with 67% saying they
would risk more than their competitor to maintain competitive
edge.
However, BFM CEOs recognized that trust cannot be sacrificed for
innovation. 64% of surveyed BFM CEOs agreed that maintaining
customer trust will have a greater impact on success than any
specific product or service, and 83% acknowledged that transparency
around adopting new technologies was critical for fostering trust
among customers and employees.
"CEOs in the banking and financial markets sector are keenly
aware of the competitive benefits that generative AI will bring and
are eager to move quickly," said John Duigenan, Distinguished
Engineer & General Manager, Global Financial Services Industry
at IBM. "In their enthusiasm to embrace the benefits of this potent
new technology, it's critical that financial services leaders
ensure their institutions are taking steps to engineer trustworthy
AI designed to reduce risk and win the confidence of their
customers, employees and regulators."
Key Study Findings
BFM CEOs are hedging their bets on generative AI to stay
competitive and are willing to take risks to achieve this.
- 57% of respondents believe that competitive advantage will
depend on who has the most advanced generative AI.
- Two-thirds (66%) of those surveyed agreed that the potential
productivity gains from automation are so great that they would
accept significant risks to stay competitive and 67% said they
would take more risk than their competitors to maintain a
competitive advantage.
- However, customer trust was not a sacrifice CEOs are willing
to make. 64% surveyed agreed that maintaining customer trust will
have a greater impact on success than any specific product, and 83%
acknowledged transparency in adopting new technologies is critical
for fostering trust among customers and employees.
The workforce is shifting rapidly.
- 50% of CEOs surveyed said they are hiring for roles that did
not even exist last year due to the rise of generative AI.
- Yet, more than half (53%) of respondents say they are
already struggling to fill key technology roles.
- 60% of respondents said their current team has the knowledge
and skills to incorporate new technologies like AI.
- Only 40% of respondents have assessed the potential impact
of generative AI on their workforce.
- Surveyed CEOs say 34% of their workforce will require
retraining and reskilling over the next three years – up from just
7% in 2021.
Financial institution leaders recognize it takes a cultural
shift to scale AI successfully but face collaboration and adoption
challenges within their organizations.
- 64% of CEOs surveyed say their organization's success is
directly tied to the quality of collaboration between finance and
technology, yet half (50%) say competition among their C-Suite
executives sometimes impedes collaboration.
- 59% agree that cultural change is more important to becoming
a data-driven business than overcoming technical
challenges.
- 65% of BFM CEOs say that succeeding with AI will depend more
on people's adoption than the technology itself.
- At the same time, 43% acknowledge that their employees do
not fully understand how strategic decisions impact them.
- 60% of surveyed CEOs say they push for AI adoption more
quickly than some might find comfortable.
- 64% of surveyed BFM CEOs say to win the future, they must
rewrite their organizational playbook.
- 72% plan to maintain or accelerate their organization's pace
of transformational change in
- 2024.
Productivity is a top priority but focusing on short-term
targets may hinder long-term progress.
- BFM CEOs ranked tech modernization as their highest priority
for the next three years.
- Productivity, profitability, and scalability were identified
as the biggest challenges facing BFM CEOs over the next three
years, with 46% agreeing that generative AI will be one of the most
useful tools in helping them overcome these challenges.
- However, BFM CEOs identified the focus on short-term
performance as their top barrier to innovation.
IBM is a leading provider of enterprise AI, hybrid cloud
architecture, security and ESG insights to the global financial
services sector. Its deep industry expertise, extensive portfolio
of services and solutions, and its robust ecosystem of fintech
partners, empower collaboration, innovation, and creation with
clients. As a trusted partner to banks, insurers, capital markets
and payments providers, IBM guides financial institutions on all
stages of their digital transformation journeys through IBM
Consulting and delivers the proven infrastructure, software, and
services they need through IBM Technology. For more information,
visit www.ibm.com/industries/banking-financial-markets
Methodology
The IBM Institute for Business Value, in
cooperation with Oxford Economics, conducted interviews with 3,000
CEOs from over 30 countries and 26 industries from December 2023 through April 2024 as part of the 29th edition
of the IBM C-Suite Study series. These conversations focused on
business priorities, leadership, technology, talent, partnering,
regulation, industry disruption and enterprise transformation.
The IBM Institute for Business Value, IBM's thought leadership
think tank, combines
global research and performance data with expertise from industry
thinkers and leading academics to deliver insights that make
business leaders smarter. For more world-class thought
leadership, visit
www.ibm.com/thought-leadership/institute-business-value
About IBM
IBM is a leading provider of global hybrid
cloud and AI, and consulting expertise. We help clients in more
than 175 countries capitalize on insights from their data,
streamline business processes, reduce costs and gain the
competitive edge in their industries. Thousands of government and
corporate entities in critical infrastructure areas such as
financial services, telecommunications and healthcare rely on IBM's
hybrid cloud platform and Red Hat OpenShift to affect their digital
transformations quickly, efficiently and securely. IBM's
breakthrough innovations in AI, quantum computing,
industry-specific cloud solutions and consulting deliver open and
flexible options to our clients. All of this is backed by IBM's
long-standing commitment to trust, transparency, responsibility,
inclusivity and service. Visit www.ibm.com for more
information.
Media Contact
Mary Ellen Higgins
maryellen.higgins@ibm.com
781.789.1911
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