PROVIDENCE – Midsize companies and private equity firms are embracing artificial intelligence by implementing the technology to assess data, automate processes and streamline financial operations, according to a new survey from Citizens Financial Group Inc.
Seventy-six percent of chief financial officers who responded to the survey from midsize companies are using AI, applying it in various ways. Among decision-makers at private equity firms surveyed, nearly 100% reported AI use. Additionally, leaders in both groups said they believe AI will become an essential tool for business operations.
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“Midsize companies and private equity firms are increasingly turning to AI technology to automate processes and improve efficiency within their financial operations,” said Beth Johnson, vice chairperson and chief experience officer at Citizens. “As AI transforms midsize companies, Citizens is being very thoughtful about how we implement these new tools and guide clients through an evolving technology landscape.”
The Citizens survey of 127 CFOs at midsize businesses ($50 million to $1 billion annual revenue) and 77 financial leaders at PE firms (fund size less than $1.5 billion) was conducted in September and focused on how the companies are thinking about AI technology and implementing the technology in their financial operations.
Key findings include:
- PE firms realize the benefits of AI and are increasing investments in the technology. Eighty-one percent of financial decision-makers at PE firms say using AI has made business easier. By comparison, only 45% of CFOs at midsize companies say the same. Additionally, 85% of PE decision-makers expect to increase their level of AI investment over the next five years, compared with 58% of CFOs at midsize companies.
- CFOs are driving AI adoption at midsize companies. CFOs typically lead the way when deciding if a company will use AI. The survey found that CFOs lead 87% of AI implementations for financial processes. Chief information officers come in a distant second, leading 41% of such efforts.
- Midsize companies are using AI for cash-flow forecasting and financial analysis. Of the 76% of CFOs that report already using AI, more than half are applying the technology to these tasks. However, uses vary by industry and span a wide array of applications, from risk assessment to customer support and fraud detection. For example, while slightly fewer than half of all midsize companies rely on AI for payment automation, 75% of health care companies use it for that purpose.
- Midsize companies and PE firms using AI have concerns about potential risks. Concerns vary from industry to industry, but legal compliance is the top concern for midsize companies, followed by magnification of errors and privacy violations. Private equity firms are most focused on privacy violations, followed by legal compliance.
More results from the survey can be found here.
