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Next-Gen CX: Generative AI Reshaping Financial Services

Generative AI
Where To Play in Generative AI: Cutting Through the Hype

The financial services industry has witnessed a remarkable shift toward the adoption of artificial intelligence technologies to combat fraud, enhance security, mitigate risk and optimize customer experience. These tools have allowed financial institutions to improve their “cost to serve” in an operational capacity, streamlining business practices and allowing executives to focus on more strategic initiatives. Further, generative AI gives organizations the opportunity to better understand their customers—and turn those learnings into tailored, personalized experiences.

As organizations increasingly recognize the potential of AI and seek to keep pace with the market, can financial organizations navigate through all the hype surrounding this emerging technology and capitalize on the right opportunities?

‘AI’ as a term was first coined in 1956. For the last couple of decades, it’s been increasingly relied upon within financial services institutions for largely operational use cases, including fraud detection and credit decisioning. Generative AI exploded onto the scene with the fastest viral rate of adoption of any technology—taking just 60 days to get to 100 million users.

The pace of gAI adoption is faster than internet start-ups

ChatGPT’s adoption has been faster than all other platforms—including Instagram, Twitter and Facebook.

Figure 01

The pace of generative AI adoption is faster than internet start ups. ChatGPT reaches 100 million users in six months

This pace of adoption is far faster than the speed of implementation at most financial institutions; yet, banking is one of the sectors that could see the biggest impact when it comes to revenue and cost efficiency. As financial institutions move forward with generative AI, they will need to define the problems they wish to solve with it and establish a clear cloud-based strategy for 2024 and beyond.

Reinventing financial services with generative AI in 2024

The use cases for generative AI are far broader than just operational in nature, with the ability to completely disrupt content creation. But while in creating personalized content for consumers, enabling everything from personalized artworks to templatized job application letters, many senior executives have found the business applications to be less clear cut. What should CEOs actually be focusing on when it comes to generative AI, and why?

AI and generative AI have some distinct differences, with generative AI leaning toward the “creative.”

Figure 02

This visual shows the differences between AI and generative AI (operational versus creative).

Generative AI financial services use cases

There are three significant dimensions in how generative AI-based technologies will transform banking, from backstage operations to how coworkers interact with colleagues and enable better customer experiences.

 

  • Business Model Innovation

    Creating new innovative propositions for customers that transform the value model.

    Customer & Colleague Experiences

    Engendering new customer expectations, behaviors, and outcomes through better CX.

    Enteprise Enablement

    Introducing new assets & capabilities as well as new ways of operating.

Across these three dimensions, there are nine specific use cases that offer the most value to financial services enterprises now and in 2024. 

Nine use case categories exist across banks.

Figure 03

Imperative for change

To understand where to play, a systematic approach is required to capture the value – 9x use case categories exist across banks. Nine specific generative AI use cases for financial institutions.

  • Propositions

    MSE Chat – uses ChatGTP and MoneySavingExpert's guides to answer questions about a wide range of financial topics.

    Comms

    Morgan Stanley developed an AI-based engine called “Next Best Action,” which delivers customized messages.

    Content

    Klarna integrated ChatGPT for personalized shopping recommendations via its search and comparison tool.

  • Conversations

    Publicis Sapient - developed a ChatGPT-driven chatbot that gives natural language answers to queries on insurance policies.

    Colleagues

    Bank of America - using generative AI to create personalized onboarding experiences for new employees with tailored curricula and learning paths.

    Processes

    Trovata – Launched a tool to automate cash workflows and business intelligence for corporate finance, accounting and treasury departments.

  • Product engineering

    GMS - Experimenting with generative AI tools internally to help developers automatically generate and test code.

    Controls & protection

    Deutsche Bank – Developing AI applications for better risk management, efficiency and customer service.

    Insights & decisioning

    JPMC - using a ChatGPT-based language model to detect trading signals from Federal Reserve statements and speeches.

Source: Whitesight.net, PS Research

While there is an incredible breadth of opportunities to consider, it’s important to have a means of assessing the benefits, as well as the challenges, to prioritize them. 

Publicis Sapient has developed an AI Suitability Score, which evaluates Drivers and Barriers and allows for the creation of a ‘heat map’ of opportunities across the business. Drivers assess customer value, income generation and cost efficiency. Barriers evaluate the complexity of implementation, regulatory and compliance risk, as well as ethics.

Value Identification
AI suitability score - assigned to rate each area/category

Generative AI: evaluate where to innovate

Generative AI has the power to shape the future of banking by transforming customer experiences and business processes at scale across different lines of business. While use cases are still emerging on an almost daily basis, the biggest question to keep in mind is not ‘what’ to innovate within but ‘where,’ as there will be a big variance in the suitability of opportunities for any financial services institution. 

However, with the right strategic approach to generative AI, financial companies can prioritize resources and effectively leverage this transformative technology to create a genuine competitive advantage with measurable impact.

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James Filmer
James Filmer
Director, Strategy & Innovation Consulting Publicis Sapient

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Andrew Male
Andrew Male
Client Partner

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