Financial services unprepared for AI, tech leaders call for tighter regulation 

By Puja Sharma

–Around 88% believe stronger regulation of AI is essential, but 61% say it won’t solve all the risks

–Just 2 in 10 organisations have an AI policy in place

–Only 1 in 10 report having large scale implementations of AI

–AI, In-Office Mandates and unlocking ROI are top concerns from the world’s largest and longest running annual survey of technology leadership

With AI a top focus area for businesses, governments and regulators alike, a global study of tech leaders (CIOs, CTOs etc) has found that only 15% are prepared for the demands of generative AI. An overwhelming majority (88%) believe heavier AI regulation is essential, but the scale of the challenge is clear, with 61% believing tighter regulation won’t solve all the issues and risks that come with this rapidly developing technology.

Bev White, CEO of Nash Squared, said,“Over the years there has been much hype about the potential for AI, but this year our research suggests we may have reached a tipping point. AI sits at the intersection of people and technology, and with the recent mass adoption of generative AI, the opportunities and challenges for organisations is potentially vast. It could be the trigger that prompts an avalanche of AI investment – similar to the mass adoption of cloud over the last ten years. This just makes the regulation and governance of AI more important than ever.

Despite their keenness, many tech leaders admit that they don’t have a clear picture of the way forward and feel unprepared for the challenges ahead. Establishing clear guardrails, guidelines and ethical safety nets around AI is simply essential. Otherwise, what could be one of the truly transformational enablers of the modern age could instead become one of its biggest, risk-laden destabilisers.”

Tech Leaders Plan for Cautious Investment

• Technology spends – After the hyper growth during and coming out of the pandemic, expectations of technology spend and investment in people have returned to more ‘normal’ levels, with tech leaders still optimistic about 2024 growth. Almost half (45%) expect their overall IT/technology budget to increase during the next 12 months – a figure broadly in line with pre-pandemic years.
• Increase in headcount – A similar number of technology leaders globally (50%) expect to increase their headcount. This figure is the second highest reading in the last decade outside of the pandemic peak, although a significant fall on last year.
• Innovative tech investment largely stalls – One casualty of the pandemic that still seems to remain, is that investment in emerging tech is being held back with the exception of pilots in AI, quantum and the metaverse.

Tech Talent Shortage

• Mass skills shortages ease slightly – This year 54% of technology leaders globally say that a skills shortage is preventing them from keeping up with the pace of change, down from the record 70% last year as technology demand and skills supply move a little more in balance.
• Skills in demand – However, although scarcity of top skills for every type of technology professional has fallen year-on-year, there still remains a shortage with the most scarce skills being data engineers, enterprise architects, software engineers and technical architects.
• Demand for cyber skills sees largest fall – In recent years cybersecurity skills have occupied the top three most scarce skills, but this year has seen one of the largest falls in demand globally (down 37%) as technology leaders focus their limited budgets on completing their transformation and revenue generation ambitions rather than shoring up security.
• Potential impact of AI-driven cyberattacks on skills – Despite this drop, a quarter of technology leaders globally still struggle to find the right cybersecurity skills. The report also suggests that, if AI begins to generate new levels of cyber risk, cyber specialists may once again top the league table of skills in demand.