Report: Service providers may not understand Generative AI, but they’re going to spend more money on it anyway

A recent report indicates that a majority of professional service providers across a range of segments plan to spend more on generative artificial intelligence (GenAI) despite many of them not fully understanding what is. 

Fewer than half of the 151 respondents to a survey by Koltin Consulting Group and Pointe Advisory could demonstrate a basic definitional understanding of the differences among generative AI, deep learning and machine learning. Overall, only 41% were able to do so. 

Those in business consulting demonstrated the best understanding of the differences by a bare majority of 52%. This group’s demonstration of understanding topped those in IT consulting (45%), legal services (38%) and financial services (30%). 

Despite this lack of understanding, respondents said that they planned to use and spend more on generative AI. Ninety percent of firms have begun to incorporate AI into their strategic planning, particularly those in IT consulting and in larger organizations. 

Accounting services (including tax, assurance wealth management, and financial advisory) expect to increase their spending on AI products and services from about 28% of their revenue now to 72% in the long term, with about 23% expected to spend 25% or more of their revenue. Accounting services, along with IT consulting, expect to realize greater impact at a faster rate from generative AI than business consulting and legal services, the report found. But accounting services firms are the most concerned about the risks and threats of generative AI. 

“Automation and job loss due to AI implementation might create ethical issues around AI taking away jobs,” said one respondent. “Finding a balance between AI generation and human interaction and thought will be critical,” according to another respondent.