BetaNXT's CTO: Don’t Rush Your AI – Plan The Long Game
April 11 2024 / 3 Minute Read
Avoid the hype, implement AI solutions with a long-term strategy, develop trusted data, and safeguard client privacy.
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AI has emerged as a dominant force, reshaping, and even spawning discussions about the future across various sectors.
Within financial services and wealth management, the potential for AI to streamline operations, enhance efficiencies and optimize client service is vast. However, the rush to adopt AI solutions must be tempered with a strategic, long-term approach that prioritizes data integrity and client outcomes.
To ensure a strategic and sustainable approach to AI implementation, WealthTech providers should:
Having spent 35 years in the financial services industry, I’ve witnessed firsthand the importance of viewing AI as a long-term investment rather than a quick fix. Creating a strategy is a key step before a company can even begin implementing AI into its services.
A successful strategy should include:
Successful AI implementation hinges on robust data quality and integrity. Without accurate, reliable data, AI algorithms cannot deliver trusted, personalized insights that clients expect. Creating a trusted data stack is a foundational step in effective AI implementation. Accurate data tagging and robust data governance are essential to enable AI systems to learn and adapt rapidly. However, this process requires significant investment and effort, which can often be overlooked in the rush to adopt AI solutions.
This involves investing in talent, technology, and processes to maintain trusted datasets and ensure seamless connectivity across disparate systems. In the retail investment and advisory sphere, data precision and connectivity are only beginning to catch up with institutional trading standards. Legacy systems and disparate data formats present significant challenges for wealth management firms and their technology vendors. Without a unified data infrastructure, AI solutions might struggle to provide meaningful insights and advice to advisors and their clients.
Now this is not to say that there aren’t AI applications like chat bots, intelligence learning and analyzation, which shouldn’t be implemented immediately. If they enhance operational efficiencies without giving rise to or causing other issues, then there is merit in their prompt implementation.
For instance, chat bots can efficiently handle customer inquiries, freeing up human resources for more complex tasks, while intelligence learning algorithms can rapidly analyze vast datasets to extract valuable insights for informed decision-making. However, this is not always the best solution.
When it comes to AI, the age-old adage holds true, “Do you want it done fast, or do you want it done right?” AI’s transformative potential can only be fully realized with a concerted effort to maintain a unified, compliant, and robust data infrastructure. Applying AI as a band-aid over legacy systems with weak data functionality undermines its potential impact.
Source: Financial Advisor
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