As we approach the conclusion of 2024, many individuals are already looking ahead to 2025, with saving money emerging as the most popular New Year’s objective. Multiple surveys show that financial concerns are fuelling the desire to save, and many people are looking to take control of their financial future as the new year begins.

The Most Common Resolution: Save More Money

According to a recent Statista study of 1,050 Americans, the most popular New Year’s resolution for 2025 is to save more money, with more than one in every five Americans (21%) making this commitment. This objective outperforms other popular resolutions, including eating healthier (19%), exercising more (17%), and reducing weight (15%). Furthermore, 14% of respondents prioritised spending more time with family and friends.

A YouGov survey of over 1,100 Americans conducted in December revealed a similar pattern, which supports this finding. Saving money was the most popular resolution among 26% of respondents, followed by physical health goals (22%). Surprisingly, 13% of respondents pledged to pay off their debts, indicating a deeper concern about financial security.

Financial Anxiety Drives Resolutions

The fear over personal finances appears to be a strong driver for these resolutions. The American Psychiatric Association (APA) conducted a study of over 2,200 Americans in early December, highlighting the increased stress caused by financial problems. As they approached 2025, over 58% of respondents reported feeling nervous about their personal finances, which was much greater than the 45% who showed anxiety about their physical condition.

Dr. Marketa M. Wills, APA’s CEO and medical director, stated that the new year brings both new prospects and renewed concerns about important parts of life, such as financial security. This increased financial anxiety appears to be motivating more people to take action by establishing personal finance resolutions.

A Growing Focus on Financial Resolutions.

The APA poll also revealed that 38% of respondents made financial resolutions for 2025, a 4% rise over the previous year. This growth indicates that more people are valuing financial health and actively looking for solutions to better their financial status. In contrast, social and relationship resolutions, as well as diet-related goals, received 25% of the vote, demonstrating that finances are now a top priority for many people as they enter the new year.

The Bottom Line

As we look ahead to 2025, it’s evident that many people are focused on conserving money. Financial stress is creating a shift in priorities, with people focussing more on safeguarding their financial futures than on traditional goals like physical fitness or nutrition. Setting realistic financial objectives for the new year, such as improving budgeting, saving for the future, and paying off debt, will most likely be critical to reducing worry and obtaining greater peace of mind.

New research commissioned by IBM (NYSE: IBM) reveals that companies are committed to long-term AI investments, with increasing interest in using open-source tools to drive ROI and foster innovation in the future.

A study of over 2,400 IT decision-makers (ITDMs), conducted by Morning Consult and developed in collaboration with Lopez Research, found that 85% of respondents are progressing with their 2024 AI strategy, with nearly half (47%) already experiencing positive ROI from their AI investments. The data also suggests a link between open-source AI tools and greater financial success: 51% of companies using open-source AI tools report positive ROI, compared to just 41% of those not utilising open-source solutions.

Nearly two-thirds (62%) of respondents plan to increase their AI investments in 2025, with 48% aiming to leverage open-source ecosystems to optimise their AI implementations. Among companies not currently using open-source, 40% intend to adopt it for AI implementation in 2025.

“As organisations scale AI implementation, many are focusing more on success metrics like productivity gains, as traditional hard dollar ROI benefits have yet to appear on the balance sheets,” said Maribel Lopez of Lopez Research. “However, companies continue to push forward with their AI strategies, showing no signs of slowing down. They now understand the importance of defining specific use cases and optimising AI projects, using hybrid cloud strategies and open-source tools to drive innovation and achieve financial returns.”

Further study findings include:

Enterprises are ramping up AI investment but with a greater strategic focus.

• 89% of surveyed organisations plan to either increase or maintain their AI investment in 2025.
• Of the 62% planning to increase their investment, 39% aim to boost spending by 25–50%.
• Only 5% of respondents intend to decrease their AI spending, with none planning reductions greater than 50%.
• AI investments are being directed toward key areas, including IT operations (63% of respondents), data quality management (46%), and product/service innovation (41%).
• For 2025, IT decision makers (ITDMs) are focusing on strategic changes such as using managed cloud services (51%), hiring specialized talent (48%), and leveraging open-source tools (48%) to optimize their AI investments.

Open source is becoming crucial to companies’ AI strategies

• 6 in 10 IT decision makers (ITDMs) surveyed report using open-source ecosystems as a source for AI tools, with 41% of AI solutions expected to be based on open source in 2025, up from 37% in 2024.
• Over 80% of respondents say at least a quarter of their company’s AI solutions or platforms are based on open source.
• The likelihood of using open-source solutions increases with company size, with larger companies more likely to rely on open source for the majority of their AI solutions.
• Companies utilising open-source ecosystems are more likely to achieve positive ROI (51%), compared to those not using open source (41%).
• 38% of companies leveraging open-source ecosystems plan to launch 21+ AI pilots in 2025, compared to 26% of those not using open source for AI tooling.

Organizations report successfully advancing their AI projects, but often through less traditional ROI metrics

• 85% of surveyed IT decision makers (ITDMs) report progress in executing their AI strategy, with only 9% reporting no progress.
• 58% of respondents indicate their company moves from AI pilot to full production in less than a year.
• 31% of companies say their AI investments are more innovation-driven, 28% focus more on ROI, and 41% balance both innovation and ROI.
• The top three ROI metrics for ITDMs are faster software development (25%), more rapid innovation (23%), and productivity time savings (22%). Hard dollar savings ranked fourth at 15%.
• 47% of companies report achieving positive ROI from AI projects, while 33% break even, and 14% see negative ROI.
• Among companies not yet seeing positive ROI, 44% expect to see dollar savings within 1-2 years, and 92% believe they will achieve a positive ROI within 3 years.

Study Methodology

The survey was conducted by Morning Consult from October 30 to November 13, 2024, and included a total sample of 2,413 IT Decision Makers (ITDMs) across 12 countries: the US, Canada, Mexico, Brazil, the UK, France, Germany, Spain, India, Singapore, Indonesia, and South Korea. The online interviews were unweighted, and respondents held director-level or higher roles within technology departments at companies with at least 101 employees. All participants had decision-making authority over one or more of the following areas: business consultant/consulting services management, IT product purchasing, or business consulting services purchasing.

About IBM

IBM is a global leader in hybrid cloud, AI, and consulting services, helping clients in over 175 countries unlock insights from their data, optimise business operations, reduce costs, and gain a competitive edge. Over 4,000 organisations in critical industries such as financial services, telecommunications, and healthcare depend on IBM’s hybrid cloud platform and Red Hat OpenShift to drive their digital transformations swiftly, efficiently, and securely. With innovations in AI, quantum computing, industry-specific cloud solutions, and consulting, IBM offers open and flexible options to meet the diverse needs of its clients. This commitment is underpinned by IBM’s core values of trust, transparency, responsibility, inclusivity, and service.

Visit www.ibm.com for more information.

The way people consume news is changing dramatically. For many years, television was the primary source for breaking news, in-depth reports, and fascinating storytelling. However, with the emergence of the internet, online platforms have grown in popularity, surpassing traditional television as the primary news source for many people.

The Digital Disruption

The internet’s ability to provide real-time updates and a diverse range of content has transformed the way we consume news. Unlike television, which has defined schedules and limited content, online platforms provide a constant stream of news, appealing to a variety of interests and tastes. This transition has been expedited by social media, with platforms such as Facebook, Twitter, and Instagram serving as vital tools for news dissemination and engagement.

Social media’s function in news distribution is critical. Users can curate their news feeds, interact with material, and discuss multiple points of view, all of which contribute to a more fragmented yet democratic news environment. The widespread availability of smartphones and tablets has made it easier for consumers to keep informed on the go.

The Growth of Online News

Recent surveys show major shifts in news consuming behaviour. YouTube, for example, has experienced a significant increase in its use as a news source, rising from 7% in 2023 to 19% by 2024. This increase can be due in part to YouTube’s earlier classification as “other online” sources, which accentuated its growth in recent surveys.

In contrast, traditional news sources such as print newspapers have declined. In only one year, the percentage of persons over the age of 55 who read print newspapers fell from 38% to 32%.

Online vs. Television

For the first time, online news sources have surpassed television in the United Kingdom. According to an Ofcom study, 71% of the public currently uses internet news services, while 70% rely on TV news bulletins. This represents a considerable shift from last year, when web usage was 68% and social media was 47%. A stunning 82% of young people aged 16 to 24 use social media to get their news.

Facebook, YouTube, and Instagram are the top three internet news providers. Meta, which owns Facebook, Instagram, and WhatsApp, is the second most popular news source, with 40% of users accessing it for information.

Challenges and Concerns

The emergence of online news has not come without obstacles. The propagation of fake news and misinformation is a serious danger, as fraudulent content may spread quickly across digital channels. Furthermore, the concentration of media ownership among a few large businesses raises worries about possible censorship and bias.

Despite these disadvantages, many people prefer online news because of its convenience and accessibility. Online platforms provide interactive features, multimedia content, and personalised recommendations, which improve the user experience and keep viewers interested.

The Future of News Consumption

The digital revolution in news consumption is expected to evolve further. Emerging technologies like virtual reality (VR) and augmented reality (AR) have the potential to provide immersive news experiences, while voice-activated assistants may become more vital for getting news updates.

Although online platforms have taken a prominent position, traditional television is unlikely to disappear. TV still has distinct advantages, such as conveying news in a visual and compelling manner.

In summary, the transition from television to online news marks a watershed moment in media history. While issues like misinformation must be addressed, the digital revolution presents great alternatives for how we keep informed. As we navigate this ever-changing landscape, we must embrace new tools while remaining sceptical of the content we consume.

Source: Ofcom

According to recent Federal Trade Commission (FTC) findings, Bitcoin ATMs have emerged as a new hub for scams, raising concerns among both digital currency enthusiasts and common customers. This disclosure highlights the critical need for more attention and stronger security measures in the bitcoin ecosystem.

Bitcoin ATMs, which are designed to give customers convenient access to buying and selling cryptocurrency, have become a popular target for fraudsters. The FTC’s most recent study reveals a disturbing uptick in frauds employing these machines, which provide a convenient but potentially unsafe conduit for financial transactions.

The FTC’s data focus demonstrates that scammers are using Bitcoin ATMs to defraud innocent people. These scammers employ a range of techniques, including impersonating respectable organizations and offering high returns on investments. They frequently instill a sense of urgency in victims, encouraging them to act fast and without adequate due diligence. Once the transaction is completed, the monies are usually irrecoverable, leaving victims with substantial losses.

One of the primary issues is a lack of regulatory control and security features at many Bitcoin ATMs. Unlike traditional banking systems, which are subject to strict rules and fraud prevention measures, Bitcoin ATMs frequently operate in a less regulated environment. Scammers can take advantage of this oversight loophole.

The FTC underlines the need for caution and understanding when using Bitcoin ATMs. Consumers should verify the legality of any transaction and be suspicious of unsolicited offers or requests for immediate action. Additionally, it is critical to understand the potential hazards involved with bitcoin investments and transactions.

As Bitcoin and other cryptocurrencies gain popularity, the necessity for strong security measures and user education becomes more evident. The FTC’s warning is a timely reminder for Bitcoin ATM users and operators to keep informed and attentive against rising hazards in the digital currency world.

Those who use Bitcoin ATMs or are thinking about investing in bitcoin can reduce their chances of falling victim to scams by remaining knowledgeable about potential hazards and practicing appropriate security practices. The FTC’s findings illustrate the continued need for attention when navigating the changing world of digital finance.

According to a recent Reuters report, travel spending is expected to contribute a record-breaking 10% of global GDP this year, citing figures from the World Travel and Tourism Council (WTTC), a non-profit membership organization.

According to WTTC estimates, the travel industry will contribute $11.1 trillion to global GDP in 2024, up 12.1% from the previous year and 7.5% from the record set in 2019.

“Despite some concerns last year about us going into a global recession and high inflation, this year we are looking at travel and tourism being a real economic powerhouse globally,” said Julia Simpson, CEO of the council.

According to the report, the United States, China, and Germany will each contribute significantly to this spending. The travel sector also supports around 348 million jobs worldwide, a 13.6 million rise from 2019.

Furthermore, the sector’s workforce continues to grow, with an estimated 1 million hospitality and leisure employment open in the United States, according to the U.S. Travel Association. According to the WTTC, the sector employed around 27 million people in the United States last year.

During this expansion, personnel for travel companies has become a major priority, especially given the obstacles created by outmoded payment mechanisms. These methods have historically generated slow reimbursements and delayed disbursements, resulting in lower employee satisfaction and retention due to workers’ inability to access digital tips quickly.

Implementing digital immediate payment systems has the potential to considerably reduce these challenges. For example, approximately 80% of workers would prefer to receive fast tip payouts if given the opportunity, yet many employers have not implemented this technology. This gap represents a significant potential for travel and hospitality businesses.

In addition, the gradual adoption of digital tools in the travel industry presents both obstacles and opportunities. While the business must encourage a large number of consumers to use online tools, it also stands to benefit from a growing market of tech-savvy visitors.

In summary, travel spending is expected to account for a record 10% of global GDP in 2024, totaling $11.1 trillion. This is a considerable increase over last year and exceeds pre-pandemic levels. The sector supports around 348 million jobs globally, with continual hiring. Adopting digital quick payments could alleviate the challenges of outdated payment systems, while modern technologies such as AI and VR offer prospects for further growth.

In the ever-changing digital landscape, parents are frequently left wondering, “Where are my children spending their time online?” For many, the answer may be startling. According to new research from Qustodio, more over 30% of Generation Alpha’s 7- to 9-year-olds — sometimes known as “iPad kids” — have accounts on the social networking platform X (previously Twitter).

This statistic serves as a sharp reminder of how quickly social media platforms are gaining popularity among youth. While many people believe that platforms like X are primarily designed for adults, children are increasingly connecting with these venues. But what is attracting this new wave of younger users to X?

The Google Search Connection

One of the primary reasons for the influx of youthful people to X could be its connection with Google Search. X posts are now prominently shown in search results, increasing the platform’s accessibility and visibility to the younger population, who is known to spend time researching numerous hobbies online. With a single search query, they are exposed to X material, prompting them to establish accounts and explore the platform.

The growing interconnection of social media platforms and search engines creates new concerns for parents. What was formerly considered an adult-only place has suddenly become a potential destination for children, complicating efforts to monitor and manage their online activity.

Risks of Early Social Media Exposure

While social media provides numerous positives such as creativity, connection, and education, it also poses major concerns, particularly for young children. These sites expose youngsters to potentially inappropriate content for their age group, opening the door to cyberbullying, misinformation, and even predators.

Parents face a larger task than ever. To ensure that their children use these networks safely, parents must maintain vigilance, communicate openly, and implement parental controls. Even with these technologies, it is impossible to totally control children’s interactions on social networking sites such as X, which were not originally intended with young audiences in mind.

Tech Giants Target Young Audiences

It’s no secret that digital businesses are continuously seeking for new methods to grow their user base, and Generation Alpha is the latest frontier. Social media networks are gradually altering their features to attract younger viewers. Instagram, for example, allows users to upload music to their profiles, evocative of the nostalgic Myspace period, enabling younger users to interact with the network in new ways.

Meanwhile, firms like Waymo are looking into subscription services focused exclusively for teenagers, including as their possible “Waymo Teen” service, which allows kids to hail robotaxis with parental alerts. This highlights the growing impact of younger generations on technological development, as they shape the future of technology to meet their demands.

Parental Control and Awareness

With more than 30% of 7- to 9-year-olds now using X, it’s evident that platforms traditionally reserved for adults are evolving into digital playgrounds for younger generations. Parents are responsible for keeping their children aware, communicating with them about internet safety, and using technologies like Qustodio to monitor their behavior.

Aside from parental controls, there is an increasing need for social media platforms to acknowledge this trend and offer greater safeguards for young users. As children get more involved with platforms like X, tech companies must step up to ensure that the information and interactions within their ecosystems are safe and age-appropriate.

So, do you know where your kids are online? If not, you could wish to see if they use social networking networks like X.

Based on the most recent consumer study by impact.com , people who spend more are more thoughtful than they ever have before, but they’re also willing to splash out in order to receive the perfect incentives. 

These are the five most important insights which can allow you to reach your customers more effectively and gain the top spot on their lists of wants by 2024.

Insightful Consumer Shopping Trends

The year 2023 was the first time American customers discovered the brands must be more strategically oriented to make budget-conscious choices. Customers are changing their buying behavior, with discretionary purchases reserved during sales season. However, these changes present unanticipated potential for retail stores. With four out of five Americans having embraced more affordable brand names and higher deals, they’ve an increased amount of cash and are prepared to spend greater than they did in previous years. But, companies must convince consumers that their products are worth investing in.

With the current economic environment partnership agreements give less well-known companies the opportunity to be competitive with household brands through increasing their visibility through trustworthy partners while reducing risks by providing discount coupons. To take advantage of this new trend, brands need to be aware of the changing consumer behavior and determine the most efficient strategies to take advantage of these trends.

2023 Consumer Trend Benchmark research study conducted by impact.com analyzes the consumer’s spending patterns across 2023 and 2022. This research provides brands with the necessary data to appeal to today’s money-conscious consumers by implementing a solid partnership strategy this year.

Methodology

The impact.com Data Science team carried out the study in the month of January to study the most prominent trends in consumer shopping for 2023. The study compared the performance of partnerships, including Average Order Value (AOV) and clicks sales, conversion rates, advertising spend and spending by consumers. The researchers tracked these KPIs by comparison of same-store and year-over-year (YoY) results from brands who actively utilized the impact.com platform between 2022 as well as 2023.

5 Key Insights on the behavior of consumers in 2024’s consumer spending

1. When Prices Increase, Shop habits shift

It was common for people to continue the trend of shopping less by purchasing 7% less by 2023. Since shoppers are preparing to invest more in essentials like gas and groceries and other necessities, they cut down on discretionary spending. The uncertainty has led to decreases in transactions through the majority of 2023 in comparison to 2022 which was only noticeable in December, with an increase of 6% in sales YoY.

People who spent their money waited for discounts during major holiday seasons like Mother’s Day, Memorial Day or Cyber Week. The availability of multiple payment options could encourage more spending discretionary since inflation is expected to stay at a steady pace in 2024.

2. Window Shopping is Out But Intentional Shopping is in

Window shopping and consumer research was different in the past year. Brands experienced an increase of 32% in conversion rates even though they saw a decrease of 29% in clicks by 2023. Sale events that are popular around Mother’s Day, Father’s Day as well as Easter saw less clicks than in the previous year.

The data shows that consumer purchasing intentions were higher in 2023. In general, consumers made less purchases in 2023 and spent less time looking or making impulse purchases. Instead, they concentrated on securing deals for products that were already on their lists. The partnerships may have helped them organize their lists prior to when sales started, thereby saving the effort and time of going to the store.

3. Inflation drives up Cart Values

Although shoppers who are budget conscious trimmed their purchases, the average purchase value (AOV) was still increasing. A mere 2% annual growth in AOV is a sign of the possibility that inflation in prices is making cart prices rise, not as if people were spending more money on items. People who had to purchase additional items might have trimmed their expenditure by seeking alternative ways to save money.

These changes could explain this is the reason AOV decreased more than it usually is and also experienced some slight decline during Q4’s busy sales season. People were looking for methods to reduce their spending in the purchasing of essentials during the entire time, but also indulged in areas like art and entertainment.

4. Strategic Splurging Provides Consumers with the opportunity to enjoy luxury

Prices haven’t stopped 40% of people from deciding to make certain purchases, like expensive food items, or even trips. Although overall spending on consumer goods fell 5 percent YoY, a few segments saw a sudden increase in expenditure.

The slowdown in consumer spending over the third quarter suggested that shoppers may have been preparing themselves to take advantage of the huge discounts they’ve grown accustomed to in holiday events, retail and sales. Companies may consider offering massive discounts throughout the year instead of focusing on special events like shopping and holidays.

5. A slight increase in Advertiser spending Add to

Although the patterns of advertising spending were generally consistent, companies moderately increased the commission rate of their partners during 2023. This extra expenditure was rewarded with increased conversion rates in certain products.

When advertising expenses rise companies may look to boost ROI using the use of performance-based marketing, for example partnership. Due to the changing behavior of buyers, partnership can be an effective way to boost the visibility of brands, increase the likelihood of buying, and encourage even the most cautious buyers to purchase.

Are You Ready to Begin Your Partnership Program?

Meet with our expert team on partnership and ask for a demonstration to ensure that you are on the people’s wish lists through collaborations. The shopping habits of last year’s shoppers reveal that the savvy consumer of today is willing to spend more in a way that brands don’t expect. Partnerships based on performance allow companies to connect with new clients, get more clicks, boost sales, and make money based on the outcomes.

2024 is the Year of Opportunity for Retail Partnerships

An urge to save money on everyday necessities drives people towards new brands, providing the chance to meet potential customers. Partnerships aren’t just “nice-to-have” anymore. They’re the most effective way for companies to generate profits in the current tumultuous economic environment. Find out how partnerships can help to maximize your ROI now.

In a time that is driven by convenience and food delivery apps are a must, they have changed the way we consume. Recent research conducted by LocalCircles reveals an unsavory aspect of these dining experiences on the web with hidden costs that the customers do not know about. The phrase “basket sneaking” is used to refer to these unplanned costs which can transform a basic food order into an expensive experience.

Based on the study the survey found that 87% of those who took part reported having the sneaky basket. The hidden costs can be found in diverse forms, including charges for delivery, surcharge cost, and even packaging fees. Some customers believe that the additional charges aren’t easily disclosed during the order procedure. Instead, they are displayed right after checkout, and catch people off guard.

The majority of customers of around 43% thinks that the concealed charges are not fair. They believe that transparent pricing is vital and food delivery services should be able to clearly declare all possible costs upfront. A customer shared that “I often find myself paying much more than the listed price of the food. It’s frustrating because the charges seem to pop up out of nowhere.”

This survey also pointed out the lack of uniformity in prices across various platforms. As an example, a similar dish may be priced higher in one application than the other because of different service charges and delivery fees. It is difficult for customers to make educated choices about the best place to buy from.

“Basket sneaking” isn’t the sole issue people face. There are also complaints about the quality of the food as well as the length of time it takes for the food to reach their homes. However, the ease of using food delivery services keeps them popular, particularly in cities in which busy lives make cooking at home more practical.

To tackle these issues Certain experts have suggested tighter rules for food delivery applications. They could require greater open pricing, as well as assure that additional charges are clearly stated before the consumer places the order. Some believe that competition between apps is bound to result in better practices when companies try to maintain customer loyalty.

As a result of the study, various food delivery services have announced they’re working hard to increase transparency and improve user experience. They recognize the necessity of building confidence with their clients and realize that hidden fees may undermine confidence.

The main conclusion of the LocalCircles study is the necessity for more transparency and clarity regarding how food delivery applications provide their price. Since consumers have become cognizant of the dangers of “basket sneaking,” they expect clearer pricing models. At present, the most effective suggestion for customers is to check every charge before placing the purchase and also to check the prices on different sites to ensure that they are receiving the most value.

While food delivery services offer unbeatable convenience, it’s crucial to be alert to hidden costs. In this way customers are able to enjoy their food without having to worry about any financial shocks.

Have you started thinking about your future? 

Americans are saving more money to retire than ever before, however the idea of a secure retirement is still unattainable to many. Vanguard’s annual “How America saves” report offers some encouraging developments, but it also reveals some significant issues.

In 2023 the median account balance of retirement accounts for Vanguard members was $35,286, a massive 29% improvement from the decrease in 2022. In addition, the average balance was up by about 3% by $134,128, which is up 19% higher than the previous year. This increase is due to higher contributions as well as improvements both in bond and equity markets, as per Vanguard. The large disparity between the median and average accounts suggests a concentrated accumulation of wealth within a couple of big accounts, which elevates the amount of money.

In spite of this, a lot of Americans remain far from the savings they want to save for retirement. Northwestern Mutual’s study shows that the “magic amount” to retire — that is, the amount U.S. adults believe they require to comfortably retire –is now $1.46 million. It’s a substantial rise of more than 53% over $951,000 as of 2020. This is a sign of increased expectations, as well as the increasing expenses associated with retiring.

2023 was a year marked by worries about inflation, as well as a general negative outlook in the minds of consumers, but the outlook for retirement savings was positive. Vanguard’s study found that plans’ savings and participation rates reached records. A staggering 82% of workers enrolled with their employer’s non-compensation savings plan last year with a steady 5 percentage point rise over the last decade.

A significant percentage of the participants in plans made proactive efforts to increase their savings. Around 43% of plan participants have increased their contributions via automatic increases or through manual adjustments to their contribution. The average is that Vanguard plan members made a record 11.7 percent of their income to retirement savings plans and this figure is inclusive of both employee contributions and employer matching. The figure has remained steady over the last record, which was set in 2022. It is an increase of 0.4 percent over the year 2019. The employees alone contributed an average of 7.4 percent.

The research shows that Americans tend to be more focused on investing in retirement savings but the path to an enjoyable retirement can be a rocky one. A rise in account balances is good news, but most people stay away from the $1.46 million they consider essential for retirement security. life. Since economic uncertainty and inflation persist to affect savings, a focus on increasing contributions and greater involvement in pension plans is essential.

New findings from the IBM Institute for Business Value revealed that banking and financial markets (BFM) CEOs are facing workforce and culture and challenges as they act quickly to implement and scale generative AI across their organizations.

The findings are part of an annual global cross-industry study that surveyed more than 3,000 CEOs from over 30 countries and 26 industries, which included 297 BFM CEOs representing retail, corporate, commercial and investment banks and financial markets.

The survey found that generative AI is perceived as the key to unlocking competitiveness. 57% of BFM CEOs surveyed stated that gaining a competitive advantage in the sector will depend on who has the most advanced generative AI.

The findings also revealed that CEOs are navigating complex issues around culture in the era of AI. 59% of surveyed BFM CEOs stated that cultural change within a business is more important than overcoming technical challenges when becoming a data-driven business, with 65% also believing success with AI will depend more on people’s adoption than the technology itself.

Despite this, 60% of surveyed BFM CEOs say they are pushing for AI adoption more quickly than some employees might find comfortable. Yet 43% acknowledged that their employees do not fully understand how strategic decisions impact them.

Skills also proved to be an area of focus for the CEOs. While 60% of surveyed BFM CEOs say their teams have the skills and knowledge to incorporate generative AI, more than half (53%) of respondents say they are already struggling to fill key technology roles. In addition, 50% of these CEOs said they are hiring for roles that did not even exist this time last year due to generative AI, showing the rapid shift occurring in the workforce.

“Our research reflects the tremendous pressure CEOs are under to keep their competitive edge. Alongside profitability and productivity, getting the right skills remains a persistent challenge, with CEOs now hiring for roles that did not exist until recently,” said Shanker Ramamurthy, Global Managing Partner Banking & Financial Markets, IBM Consulting. “Workforce needs are shifting rapidly in the financial services sector and CEOs must ensure that upskilling programs are prioritized as an important element of any financial institution’s enterprise strategy for scaling generative AI.”

In addition, 66% of BFM CEOs surveyed stated that the potential productivity gains from automation are so great that they would accept significant risks to stay competitive, with 67% saying they would risk more than their competitor to maintain competitive edge.

However, BFM CEOs recognized that trust cannot be sacrificed for innovation. 64% of surveyed BFM CEOs agreed that maintaining customer trust will have a greater impact on success than any specific product or service, and 83% acknowledged that transparency around adopting new technologies was critical for fostering trust among customers and employees.

“CEOs in the banking and financial markets sector are keenly aware of the competitive benefits that generative AI will bring and are eager to move quickly,” said John Duigenan, Distinguished Engineer & General Manager, Global Financial Services Industry at IBM. “In their enthusiasm to embrace the benefits of this potent new technology, it’s critical that financial services leaders ensure their institutions are taking steps to engineer trustworthy AI designed to reduce risk and win the confidence of their customers, employees and regulators.”

Key Study Findings

BFM CEOs are hedging their bets on generative AI to stay competitive and are willing to take risks to achieve this.

• 57% of respondents believe that competitive advantage will depend on who has the most advanced generative AI.
• Two-thirds (66%) of those surveyed agreed that the potential productivity gains from automation are so great that they would accept significant risks to stay competitive and 67% said they would take more risk than their competitors to maintain a competitive advantage.
• However, customer trust was not a sacrifice CEOs are willing to make. 64% surveyed agreed that maintaining customer trust will have a greater impact on success than any specific product, and 83% acknowledged transparency in adopting new technologies is critical for fostering trust among customers and employees.

The workforce is shifting rapidly.

• 50% of CEOs surveyed said they are hiring for roles that did not even exist last year due to the rise of generative AI.
• Yet, more than half (53%) of respondents say they are already struggling to fill key technology roles.
• 60% of respondents said their current team has the knowledge and skills to incorporate new technologies like AI.
• Only 40% of respondents have assessed the potential impact of generative AI on their workforce.
• Surveyed CEOs say 34% of their workforce will require retraining and reskilling over the next three years – up from just 7% in 2021.

Financial institution leaders recognize it takes a cultural shift to scale AI successfully but face collaboration and adoption challenges within their organizations.

• 64% of CEOs surveyed say their organization’s success is directly tied to the quality of collaboration between finance and technology, yet half (50%) say competition among their C-Suite executives sometimes impedes collaboration.
• 59% agree that cultural change is more important to becoming a data-driven business than overcoming technical challenges.
• 65% of BFM CEOs say that succeeding with AI will depend more on people’s adoption than the technology itself.
• At the same time, 43% acknowledge that their employees do not fully understand how strategic decisions impact them.
• 60% of surveyed CEOs say they push for AI adoption more quickly than some might find comfortable.
• 64% of surveyed BFM CEOs say to win the future, they must rewrite their organizational playbook.
• 72% plan to maintain or accelerate their organization’s pace of transformational change in 2024

Productivity is a top priority but focusing on short-term targets may hinder long-term progress.

• BFM CEOs ranked tech modernization as their highest priority for the next three years.
• Productivity, profitability, and scalability were identified as the biggest challenges facing BFM CEOs over the next three years, with 46% agreeing that generative AI will be one of the most useful tools in helping them overcome these challenges.
• However, BFM CEOs identified the focus on short-term performance as their top barrier to innovation.

IBM is a leading provider of enterprise AI, hybrid cloud architecture, security and ESG insights to the global financial services sector. Its deep industry expertise, extensive portfolio of services and solutions, and its robust ecosystem of fintech partners, empower collaboration, innovation, and creation with clients. As a trusted partner to banks, insurers, capital markets and payments providers, IBM guides financial institutions on all stages of their digital transformation journeys through IBM Consulting and delivers the proven infrastructure, software, and services they need through IBM Technology. For more information, visit www.ibm.com/industries/banking-financial-markets

Methodology

The IBM Institute for Business Value, in cooperation with Oxford Economics, conducted interviews with 3,000 CEOs from over 30 countries and 26 industries from December 2023 through April 2024 as part of the 29th edition of the IBM C-Suite Study series. These conversations focused on business priorities, leadership, technology, talent, partnering, regulation, industry disruption and enterprise transformation.

The IBM Institute for Business Value, IBM’s thought leadership think tank, combines

global research and performance data with expertise from industry thinkers and leading academics to deliver insights that make business leaders smarter. For more world-class thought leadership, visit http://www.ibm.com/thought-leadership/institute-business-valuewww.ibm.com/thought-leadership/institute-business-value

Source: IBM