Half of current Finance artificial intelligence (AI) deployments will be either delayed or cancelled by 2024, while the use of business process outsourcing (BPO) for AI will rise from 6% to 40% within two years, according to Gartner, Inc.
CFOs face major barriers to scaling up the use of AI in-house and will increasingly turn to business process outsourcing (BPO) solutions to meet their digital transformation objectives.
Barriers to Scaling AI Internally Will Lead to Rise in the Use of BPO Providers
Gartner
The top three barriers to scaling AI in Finance
- Costly upfront infrastructure – Building infrastructure in-house requires upfront investments in acquiring new specialist skills for infrastructure maintenance and additional security investments required to manage an ever-growing user base.
- Lack of bandwidth among citizen developers – AI models require continual monitoring and frequent retraining and configuration updates. These requirements divert citizen developers from their core tasks and stretch internal bandwidth.
- Skill-gaps among citizen developers – The citizen developer role is not designed for the technical complexities required to synchronize IT systems and services, nor do they have the skill sets required in workflow management to adapt to frequent changing parameters.
Digital automation in Finance often fails to deliver the expected benefits outlined in business cases
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This is leading to the increasing use of BPO Providers for Finance AI
The rise of AI-enabled BPO
Gartner’s report noted “Finance departments have thus far been slow to adopt BPO providers for AI, with just 6% currently utilizing an AI-enabled BPO.
This usage will rise to 40% by 2024, as the benefits of deploying a market-ready solution for AI become more apparent to CFOs”.
Gartner highlighted three major advantages of AI-enabled BPO for finance departments:
- Market readiness – With 85% of vendors providing an AI service for offering for transactional processes, and the majority of vendors holding necessary cloud certifications, AI capabilities are available to start today.
- Economies of scale – BPOs offer larger datasets and a globally available talent pool that enables scaling in a manner that would be near impossible internally.
- Modular approach – BPO providers utilize AI technology as the core engine of the many solutions that can achieve digital finance transformation. This means finance departments can pick and choose capabilities without losing the underlying AI capabilities.
“CFOs are increasingly learning from past experiences of ‘going it alone’ with technologies such as robotic process automation (RPA), which have failed to achieve the expected ROI.
“The case for offloading AI to an experienced BPO provider is even stronger.
Without correcting for this state of “fake automation,” finance departments will struggle to scale automated solutions, such as AI, effectively across the function”.
