A new survey by leading international law firm Mayer Brown has revealed that business leaders are increasingly aware of their organizations’ ability to keep pace with developments in AI and technology. Of those surveyed, over seven in 10 are concerned that they are being outpaced by developments in AI.
The survey, which includes insights from 197 business leaders found that 72% of leaders of financial institutions and 83% of leaders of investment firms believe the need to advance their existing AI capabilities will be the primary driver of M&A activity over the next few years.
Lauren Pryor, partner and co-leader of the Financial Services Product Team and the Financial Services M&A group at Mayer Brown commented: “AI is quickly reshaping the business landscape and there is clear recognition among financial services leaders of the critical role of technology in their transformation efforts – many are re-examining their business strategies and asking how could AI transform my company? This, in turn, is impacting their M&A decisions. In addition, businesses are expressing a desire for more support. Acquisition growth can quickly bridge the knowledge gap and help our clients stay ahead of the curve.”
However, despite recognition of the importance of technology, fewer than a third of financial services businesses have a clear strategy in place for AI. Of those that do, only 34% have a strategy that looks beyond the next twelve months. Increasingly, business leaders are looking beyond organic growth for AI expertise or infrastructure.
The survey also identified seven key dimensions of a business that is future ready. These are Creative Capital, Geopolitical Agility, New Risk Mindset, Regulation Anticipation, Sustainability Focus, Tech Resilience, and Visionary Growth & Leadership. Amongst the most significant insights, the survey found:
- Nearly two-thirds (64%) of business leaders acknowledged the need for complete organizational transformation, and 68% believe the current market environment creates challenges to accomplishing business transformation
- Over two-thirds (68%) of financial institution leaders say their organizations are not transforming fast enough (compared to 62% of investment firms)
- While 86% of financial services firms have an overall business transformation strategy in place, most do not look beyond 12 months
- Over two-thirds (64% of financial institutions and 69% of investment firms) believe that their organizations need complete transformation to thrive and create value
