Most finance leaders in a new report say their companies are overspending on artificial intelligence and that AI is increasing reporting burdens. Yet, they remain confident in AI’s ROI.
AI perceptions are among multiple issues highlighted in software company Pigment’s third-quarter CFO Index, based on responses from 2,000 finance leaders from France, Germany, the UK, and the US in August and September.
The report addressed geopolitical uncertainty, revenue performance, growth projections, supply chain disruptions, data quality, and pace of technological change.
Eighty-three per cent of respondents said consumption-based AI costs have exceeded budget expectations, while only 13% reported staying within budget. The most common budget overrun fell in the range of 11% to 25%, although more than a third of respondents said they had exceeded AI budgets by more than 25%.
Despite the cost overruns, finance leaders remain optimistic about AI’s potential benefits. Respondents rated their confidence in AI’s ability to deliver business value at an average of 8.2 out of 10.
And all the AI buzz didn’t move the pace of technological change to the top of a list of uncertainty drivers. The top driver was macroeconomic conditions, followed by geopolitical conflict. Many top uncertainty drivers were bunched together, with six choices rated between 2.87 and 2.99 on a scale of 1 (no impact) to 4 (major impact).
“CFOs aren’t worried about one big thing,” the report said. “They’re worried about everything, moderately.”
AI is reshaping roles more often than displacing workers, the report said. More respondents said AI has increased their organisation’s finance headcount (32%) than reduced it (20%). Thirty-six per cent of executives said they have changed the scope of existing roles, and 28% have created new finance roles.
As demands increase for finance teams, organisations are not always providing enough training to help employees adapt, the report said.
Even in companies considered to be AI-mature, the technology is not saving the finance function time in executive reporting. The report said that finance teams spend an average of 32 hours a month on executive reporting, but a higher percentage of AI-mature companies’ finance teams are spending more time, not less, on such reporting.
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