This week, several publications and articles looked at the impact of AI on various industries, revealing a growing recognition of its transformative potential, yet starting from different points. From asset management to journalism and creative industries, AI is reshaping the way businesses operate and deliver value to their customers, yet all at different speeds.
A BCG study found that 72% of surveyed asset managers believe AI will have a significant or transformative impact on their organization within the next three to five years, with 66% making AI a strategic priority. On the outset, these numbers feel low for an industry that faces an ever-increasing fee-pressure coupled with an increasing cost-base. AI is already being used to improve Asset Liability Management (ALM) and Strategic Asset Allocation (SAA) processes, leading to more efficient risk-adjusted returns and cost reductions of 5% to 15%. However, most asset managers are still in the early stages of developing their AI strategies, and investments in people, technology infrastructure, and risk management are lagging behind.
The asset management remains largely undisrupted and heavily regulated, so is understandably slow to get off the mark.
A different perspective comes from an industry that had its business model already fundamentally disrupted in the past. The FT expresses a more fearful outlook on the impact of AI on its business, journalism, drawing parallels to the (traumatising) dot.com boom. They argue that the widespread adoption of AI could significantly disrupt traditional news business models and revenue streams. If readers increasingly turn to AI-powered tools for news summaries, analysis, and Q&A, it may reduce direct traffic to news websites and apps. This in turn would impact subscription growth and ad revenue.
News organizations are forced to rethink their value proposition, again – focusing more on original reporting, deep subject matter expertise, and building direct audience relationships that AI aggregators can’t easily replicate. They may also need to develop their own AI offerings and tools to enhance the user experience and maintain engagement.
Other industries see and feel different urgencies to embrace AI.
TV production companies like RTL Group and Banijay are exploring AI-assisted content (and even format!) creation. While human creativity remains paramount, these companies recognize the potential of AI to contribute to genre defining entertainment. Eline van Der Velden, founder and CEO of Particle 6, believes that AI can help producers speed up processes and enabling them to focus on the creative aspects of their work. However, some industry experts, like Dan Whitehead from K7 Media, caution against relying too heavily on AI, arguing that it cannot replicate the human spark that often leads to hit shows.
We’ve seen significant human resistance in this industry (Hollywood writers’ strike), yet time will tell if AI-drive production companies and studios will see dramatic productivity increases at a much reduces cost-base.
Takeaways: The path to AI adoption will be different for every organisation. Each approach is driven by past experiences, risk appetite, willingness to change, limitations (regulatory), market drivers and many, many more factors. Although some organisations still doubt the disruptive ability of AI, there is one thing every organisation can and should do: Start small. Start now. Experiment.