By Rahul Bhushan, Managing Director of ARK Invest Europe
AI is emerging as the transformative force that will redefine human productivity. From improving workforce efficiency to accelerating knowledge creation, AI promises an era of economic and scientific progress.
Even though we’re still in the early days of AI, investment management and advisory firms should seriously consider how it can have a profound effect on results on business efficiency. It can give people the potential to do the work that adds real value as it has the power to take away the bits that just take up time.
While looking to use AI themselves, investment firms can look to what other big businesses are saying and doing about AI to get an idea of making practical use of AI.
Just last month the Financial Conduct Authority (FCA) launched its AI Lab – a platform for firms to engage in AI-related insights. The lab will help financial services companies to incorporate AI safely ensuring it boosts growth and competitiveness.
There is so much possibility when it comes to AI, but investment firms need to actively plan to make use of it in order to see growth.
Economic and Business Productivity Gains Bain & Co predicts that integrating generative AI into business operations could boost EBITDA by as much as 20% within 18 to 36 months.
This rapid payback period contrasts with earlier technological revolutions, such as the adoption of electricity or PCs, where productivity gains took decades to materialise.8
The speed at which AI is delivering returns on investment in specific sectors is impressive. For example, in software development, AI-driven tools like GitHub Copilot have increased developer efficiency by 26%.9 Similarly, Amazon has demonstrated that developers using Amazon CodeWhisperer, which serves a similar function to Microsoft Copilot, completed tasks 57% faster and were 27% more likely to complete them successfully compared to those who did not use it.10
Furthermore, AI’s ability to automate complex tasks and chain multiple skills together — what experts refer to as “agentic systems”— will enable businesses to tackle long-term projects with greater efficiency. By automating workflows that require adaptability and problem-solving, AI will fundamentally reshape how companies operate, leading to sustained productivity growth.
Investment firms can use AI to level up compliance and risk management functions, as well distributing data, content and products.
All of this will drive economic gains as firms seek to implement AI within their workforce. Research by PwC has revealed that by 2030, 45% of total economic gains will come from product enhancements. This is because AI will drive greater product variety, with increased personalisation over time.
AI’s Immediate Impact on Workforce Efficiency
According to Harvard Business Review, Generative AI can be used to automate manual and repetitive tasks, freeing up time for people to work on more important things. AI can be used as a personal assistant, organising emails, calendars and reviewing or approving work.
It can also be used to transcribe meetings or interviews, saving people ample amounts of time. On top of that, Harvard Business Review said that it can assist with drafting research reports by suggesting content and even drafting parts that humans can later refine and finalise. It can be used throughout hiring processes or can be used as a security measure to help protect firms from cyber-attacks.
AI has already shown its ability to enhance worker productivity, especially those with less technical expertise. A study by Boston Consulting Group revealed that non-specialist employees, when augmented by AI, achieved performance levels comparable to those of data scientists. For instance, in coding tasks where non-specialists typically scored 37%, AI assistance raised their scores to 86%.
This remarkable improvement highlights AI’s potential to elevate workforce productivity, enabling companies to achieve more with less.
However, the study also revealed that AI does not inherently improve workers’ baseline skills. Without AI assistance, the augmented workers reverted to their original performance levels. This finding suggests that while AI can significantly boost productivity in the short term, long-term gains will require a strategic focus on developing critical thinking and problem-solving skills.
The findings show that AI serves as a tool that enhances the workforce by enabling non-experts to perform at much higher levels. This will be especially crucial in industries facing skilled labour shortages or where rapid upskilling is not feasible.
Conclusion: AI as the Driver of Long-Term Productivity and Innovation
The future use of AI for productivity gains within the investment and wealth management sector hinges on leveraging advanced infrastructure, such as specialised hardware and optimised data centres, to meet the increasing demands of AI models without sacrificing efficiency.
As AI becomes more integral to business success, the companies that build atop of this infrastructure will lead the next wave of innovation.
AI is nearing a point of transforming productivity in profound ways. Its ability to enhance workforce efficiency, accelerate knowledge creation, generate insight and spur economic growth is undeniable.
The economic benefits of AI are already beginning to materialise. As AI systems become more widely integrated into business processes, the productivity gains will grow. Moreover, concerns about a potential computer capacity crunch are being alleviated by advancements in infrastructure, ensuring that AI’s computational demands will be met for the foreseeable future.
AI represents a monumental opportunity for humanity to transcend its natural limits and elevate productivity to new heights.
The key question now is how quickly investment firms can harness its full potential to tackle the challenges of tomorrow.
With the launch of the FCA’s AI lab, are investment firms prepared for what lies ahead in the future of the sector?
