Dive Brief:

• Corporate finance teams significantly increased their adoption of artificial intelligence in the past year, after previously lagging behind other departments like human resources and legal, according to survey findings released by Gartner Wednesday.
• In the poll of 121 finance leaders across industries, 58% of respondents said their teams were using AI this year, an increase of 21 percentage points from 2023, Gartner said. Of the 42% of finance functions that aren’t currently using AI, half are planning implementation, Gartner found.
• “In this survey last year, other administrative functions (such as HR, legal, and procurement) were twice as likely to be using or scaling out AI solutions compared to the finance function,” Marco Steecker, senior director of research in Gartner’s finance practice, said in a press release. “This year the gap is almost nonexistent.”

Dive Insight:

AI is now widely viewed across the business community as a top growth enabler, with nearly half (46%) of companies ranking it as such, according to a survey published last week by Big Four accounting firm KPMG. Respondents indicated they were more likely to see significant opportunities (72%) rather than challenges (58%) when it comes to AI adoption over the medium-term.

“Private companies are laser-focused on adopting AI, but must be mindful of risks, governance and talent,” Francois Chadwick, KPMG’s global emerging giants leader, said in a press release.

Tech vendors big and small have been rolling out AI-enabled software tools at a rapid pace, with many of these announcements targeted at the office of the CFO.

In February, Microsoft unveiled Copilot for Finance, a virtual assistant in Microsoft 365 applications designed to make financial processes more streamlined and automated. 

On Wednesday, Datarails, a software vendor focused on serving CFOs of small companies, announced upgrades to its AI-powered FP&A platform known as FP&A Genius. The updated version “uses the power of predictive analysis to proactively surface issues — for instance in a company’s divisions, departments and operating countries — before they become a problem,” according to a press release.

CFOs have grown more bullish about the potential business value of AI after earlier signs of skepticism, according to Gartner’s research. Sixty-six percent of the Gartner survey respondents said they were more optimistic about the technology compared to last year.

Most finance leaders said they were furthest along in adopting use cases related to intelligent process automation and anomaly and error detection, Gartner found.

“This is likely due to the presence of readily available off-the-shelf solutions targeting these use case types,” the report said.

A survey published by Gartner last November found that 61% of finance functions either had no plans for AI implementation or were still in the initial planning phases. At the time, only 9% of finance organizations were in the scaling and using phases, compared to 20% of other administrative support functions, such as human resources, legal, real estate, information technology and procurement.

According to the latest research, 32% of finance teams are developing AI pilots, compared with 25% of other functions. But finance teams are marginally behind other functions when it comes to “using AI in production” (20% versus 23%, respectively).

Finance is slightly ahead of other functions when it comes to scaling AI to a larger group of users (6% versus 5%, respectively).