Data mining is the primary reason why US financial firms are diving deep into AI and its applications say 36% of those surveyed by Broadridge Financial Solutions. Another 20% said they used AI primarily for post-trade processing while 13% said market analytics.
Here is an excerpt from a report filed in HedgeWeek:
Comparing and relating the progress of AI initiatives to relevant historical eras, a clear majority of respondents (84 per cent) say their company is in or past “The Enlightenment Age” of AI, during which they are at or beyond proof of concept. Twenty-nine percent of companies have moved into the “Industrial Age” with pilots and one-fifth (20 per cent) are in the modern “Information Age” with AI in full production.
Though most companies are in some stage of AI adoption, or at least exploration, a cautious 10 per cent remain in the Stone Age with no current plan to leverage AI. Broadridge’s white paper is paired with the AI Readiness Assessment, which helps firms establish the strategy, structure, systems, skills and staff needed to create a successful AI program.
“While most organizations recognize that AI is a transformational technology with huge potential impact, their approach to adoption has been cautious. The survey data and white paper demonstrate how to harness the power of AI and successfully increase its adoption by first establishing a clear strategy and framework,” says Michael Tae, head of strategy for Broadridge.
Respondents also ranked their top motivations or desired outcomes for investing in AI. Half (53 per cent) cited “increased efficiency and productivity” as their top motivation and a majority (84 per cent) included it in their top three. Other top-three motivations among respondents included enhanced data and security (69 per cent) and the ability to redeploy human capital (51 per cent).
While it’s encouraging that a high number of respondents understand the advantages of AI’s capabilities, roadblocks continue to impede implementation. Nearly half of respondents (46 per cent) cited legacy technology as their top challenge. This tracks with the difficulties associated with modifying or replacing a current infrastructure and the potential need for vendor or personnel changes. Cost of investment/perceived ROI was named the second largest roadblock (31 per cent), while executive buy-in was considered a challenge by only 7 per cent of respondents.