Dive Brief:

• Artificial intelligence adoption by corporate finance teams this year is consistent with 2024 levels, despite rising optimism around the technology, Gartner said Tuesday.
• Of 183 CFOs and senior finance leaders polled by Gartner, 59% reported using AI in their departments, up just slightly from 58% last year, according to a press release on the findings. While overall adoption within the function is proceeding more slowly, 67% of those using AI in finance are more optimistic about it than they were last year, the study found.
• “This growing confidence shows that even though the pace of AI adoption in finance has slowed due to complexity, data, and talent challenges, organizations that overcome these barriers are reaping significant rewards,” Marco Steecker, senior director of research in Gartner’s finance practice, said in the release. “As AI’s performance improves, and the technology evolves to address a wider array of use cases, CFOs should experience a virtuous cycle between AI development in finance and new opportunities to leverage the technology.”

Dive Insight:

Gartner predicts that worldwide spending on AI will reach nearly $1.5 trillion in 2025 and top $2 trillion by 2026. Big tech companies in particular are spending heavily on AI while also experimenting with the technology internally.

“We like to call it drinking our own champagne,” Danielle Fontaine, an assistant controller at ServiceNow, said while describing her company’s AI journey during a virtual conference last week hosted by Financial Executives International.

Some of the speakers’ remarks showed that while several of the nation’s largest tech companies are using AI to streamline their workflows and processes, leaders are being thoughtful about use cases and guardrails and aren’t rushing into large-scale projects.

Accounting and finance leaders are being particularly “cautious around what does it mean for us to introduce these types of solutions into our processes and our environment,” Fontaine said.

The momentum in finance AI adoption has slowed following a sharp increase from 37% in 2023 to 58% adoption last year, according to Gartner.

The report points to two main factors that appear to be driving the slowdown: First, a small segment of finance departments show continued skepticism, with 16% reporting no planned AI implementations for the coming year. Second, there remains uncertainty among a larger share of finance organizations (25%) on how to best make the leap from planning to piloting, Gartner said.

Data literacy/technical skills and inadequate data quality/availability remain the largest obstacles to AI adoption, according to the research.

Efforts across enterprises to mitigate AI risks in areas such as privacy, regulatory compliance and organizational reputation has grown in recent years, according to a report released by McKinsey in early November. Back in 2022, respondents reported acting to manage an average of two AI-related risks, compared with four today.

Overall, 51% of respondents in the McKinsey study cited at least one instance of a negative consequence stemming from AI adoption, with nearly one-third of all respondents reporting issues related to inaccuracy.

Gartner’s latest survey found that three AI use cases stood out among those adopted in the finance function. Knowledge management — helping organizations organize, retrieve, and leverage information for better decision-making — was the most common use case (49%), followed by accounts payable process automation (37%), and error and anomaly detection (34%).

“Some less-established, high-feasibility use cases also show significant potential,” Steecker said in the Tuesday release. “For example, the AI use case ranked highest for impact by finance leaders was code generation, by a significant margin. Organizations are finding this use case enables staff to find custom high-leverage opportunities for increased automation and insight generation.”

After overcoming the initial barriers to launching a pilot, it still takes time to realize significant gains, with 91% of respondents reporting low or moderate impact initially, Gartner said. Organizations further along with AI adoption are over two times more likely to experience moderate impact and nearly three times more likely to see high impact from the technology, the study found.

“Given that the biggest impacts are achieved once AI is in the production stages, finance leaders should focus on accelerating promising projects through early development,” Steecker said.