COVID-19 isn’t yet gone, but business leaders are already preparing for the next pandemic—with a rapid shift toward artificial intelligence.
Banking, healthcare, and retail—industries whose core relationships and operations were among the most threatened by the pandemic—are all projected to double their investments in AI over the next four years, according to a new report. Those industries alone are expected to invest roughly $42 billion in AI by 2024, or nearly as much as the $50 billion in total worldwide AI investments this year. This, despite the economic toll of COVID that is expected to continue well into next year.
Vinay Menon, a Korn Ferry senior client partner and global leader of the firm’s AI practice, says for those organizations whose digital transformation was lagging, the pandemic underscores the importance of AI to cutting costs and creating new ways of delivering services, products, and experiences to customers. “Embracing AI is a one-way street,” says Menon. “No organization can afford to totter or turn back.”
Take healthcare as an example. While virtual care and remote patient monitoring devices were prevalent before the pandemic, healthcare organizations and practitioners were slow to adopt the AI-based technology. Then COVID-19 hit, and they had no choice. David Vied, global sector leader for Korn Ferry’s Medical Devices and Diagnostics practice, says the need to limit hospital visits coupled with an increase in administrative processes and a decline in primary care physicians means healthcare systems have to invest heavily in AI to help with everything from record-keeping to patient diagnoses. “Healthcare systems were operating near capacity before the pandemic, and now that patients are more apt to trust the technology, the investment rate is going to be steep,” says Vied.
Similarly, banks, which have already invested massive sums of money in AI, are building up AI-enhanced financial products. Deepali Vyas, a Korn Ferry senior client partner and global co-head of fintech, says banking leaders view AI as critical to strengthening cybersecurity and creating more personalized customer experiences. The latter is particularly important given that most people, especially younger customers, prefer not to visit a branch and instead do their banking digitally. “Some banks are also using AI to enhance portfolio management,” says Vyas.
On the retail side, with shoppers turning more and more to e-commerce, AI technology is critical for its ability to analyze customers’ behavioral patterns and activity, and for making recommendations that lead to incremental additional purchases, experts say.
The increased investment in AI means organizations are on the hunt for talent that understands the technology, says Chris Cantarella, a Korn Ferry senior client partner and global sector leader of software. “Firms are looking for the best talent in AI and are willing to pay top dollar for them,” he says. That includes not only engineers to develop the technology but also lawyers who can sort out regulatory and liability issues and marketers who can create experiences for consumers, among others.
“AI is the bridge to making great outcomes actually happen for customers,” Cantarella says, “and the return for each dollar spent on AI is flowing directly to the bottom line.”