CFO study: From vision to implementation – AI in the finance division of European banks

About the study: Goal and implementation

What is the CFO Study 2024 about?

Our Study aims to paint a clear picture of how AI could transform the finance divisions of Europe’s leading banks. We took a particularly in-depth, qualitative approach, focusing on the experiences and expectations of decision-makers: in total, we interviewed 25 Chief Financial Officers (CFOs) and division heads and analyzed over 100 documents. This detailed look behind the scenes is one of the particular strengths of our study, as it allows us to understand and document firsthand practical experiences and visions for the future.

Who participated in the study?

We interviewed 25 top decision-makers, including CFOs and senior finance executives from leading European large-cap banks and specialist financial institutions. Half of the interviewees were from the DACH region and the other half from other European countries. This mix gave us insights into both regional differences and common trends across the entire European banking market.

What methodology did you use and what sets the CFO Study apart from others?

A crucial aspect of our study is that we did not rely solely on human experts, but also actively incorporated AI-based methods. This relatively new approach allowed us to analyze the enormous amount of data in a structured and efficient manner. AI models such as SciSpace helped us create topic maps and analyze complex topics quickly and thoroughly to obtain a well-founded, well-structured overall picture of the current AI-related developments in finance divisions. So we did a study on AI in the finance function using AI!

Core findings of the CFO Study

Based on the interviews with CFOs: What are the core findings of the study? How do CFOs generally position themselves towards AI?

One of the key findings of our study is that AI will impact every single area of the finance division. However, the role of the CFOs themselves will not fundamentally change. What is striking, however, is that the implementation status still reflects considerable reluctance: almost 90% of the banks surveyed are still cautiously experimenting with AI to identify possible use cases. However, there is a clear consensus among the respondents that the coming years will be pivotal in moving from the experimental phase to active use.

When it comes to using AI, an adequate data structure and adequate data quality as well as AI qualifications on the part of employees are seen as important priorities. The CFOs surveyed also agree that it’s essential to define a clear strategy for the use of AI in the CFO function and clearly communicate it to the employees.

Are there any aspects that particularly surprised you?

Definitely. One of the biggest surprises was how reluctant the participating CFOs are when it comes to implementing AI, although all participants emphasized the significant impact of the technology on the future of the finance division. Data management, data protection and the often unclear regulatory framework pose particular challenges that shouldn’t be underestimated.

Although many CFOs see AI as strategically important, they have not yet integrated it comprehensively into their day-to-day operations. Some institutions cited a lack of resources and expertise as reasons for this, while others stated that there was simply not enough time to deal with AI and that a new AI strategy was therefore absolutely necessary.

In light of the often disruptive nature of AI, we had expected the CFOs we surveyed to be rather skeptical about the technology. But that is not the case. AI is perceived less as a threat to traditional finance roles and more as a means to improve and increase the efficiency of existing processes – a really positive surprise that gives us cause for optimism!

Importance of AI for tomorrow’s finance function

Are CFOs already using AI in their actual day-to-day business?

Currently, most CFOs are not yet making intensive use of AI in their daily business. So far, many CFOs have been using AI sporadically, for example to analyze data or automate individual processes. However, very few CFOs are using AI comprehensively and routinely. Nevertheless, the CFOs we surveyed are convinced that AI will be increasingly integrated into their institutions’ day-to-day business in the coming years, especially when it comes to analyzing data, increasing efficiency and reporting. They believe that in the long term, this will benefit all areas of the finance division.

Some CFOs are even experimenting with novel types of AI tools on their own initiative, attempting to ensure that all employees use various forms of AI in their everyday work so that they gradually familiarize themselves with the technology.

What types of use cases are in focus?

The study identifies almost 50 AI use cases in the financial industry. Measurable efficiency gains and cost savings have already been achieved with 16 of them. This proves that concrete improvements can be achieved using AI – especially when pursuing a well-planned and targeted approach. These use cases help make the potential of AI for the industry – and the benefits that can be achieved by expediting AI implementation – tangible.

What conclusion do you reach in the CFO Study?

In our study, we come to the conclusion that even though AI has the potential to significantly change the finance division of European banks, it is still at an early stage of implementation. The majority of CFOs and senior finance executives surveyed recognize that AI will impact every area of their division – from data analysis to decision-making processes.

However, most banks are still in an exploratory phase and haven’t come up with a comprehensive implementation strategy. The transition from the experimental phase to the implementation phase should be accelerated with targeted measures.

What is your closing summary? What do you think will be the future role of AI in the finance function?

Our closing summary is that AI is a key technology for the future finance divisions of European banks – but the industry is still at the beginning of its AI transformation. Although CFOs clearly recognize the strategic importance of AI, there is currently a large discrepancy between the potential of the technology and its actual application in everyday life.

We see the development of AI in the finance function as a journey that has to be taken, even though it can only be taken in small steps. The successful implementation of quantifiable use cases will shape the way forward and boost confidence in the technology. In the long term, AI will not only increase efficiency and precision in the finance organization, but also strengthen the role of the finance function as a strategic partner within the bank.

AI will make it possible to gain deeper insights into data, make faster decisions and significantly reduce costs – a development that will fundamentally enrich the finance function.