Hello and welcome to Eye on AI. In today’s edition…the U.S. Senate rejects moratorium on state-level AI laws…Meta unveils its new AI organization…Microsoft says AI can out diagnose doctors…and Anthropic shows why you shouldn’t let an AI agent run your business just yet.AI is rapidly changing work for many of those in professional services—lawyers, accountants, auditors, compliance officers, consultants, and tax advisors. In many ways, the experience of these professionals, and the businesses they work for, are a harbinger of what’s likely to happen for other kinds of knowledge workers in the near future.
Because of this, it was interesting to hear the discussion yesterday at a conference on the “Future of Professionals” at Oxford University’s Said School of Business. The conference was sponsored by Thomson Reuters, in part to coincide with the publication of a report it commissioned on trends in professionals’ use of AI.That report, based on a global survey of 2,275 professionals in February and March, found that professional services firms seem to be finding a return on their AI investment at a higher rate than in other sectors. Slightly more than half—53%—of the respondents said their firm had found at least one AI use case that was earning a return, which is about twice what other, broader surveys have tended to find.Not surprisingly, Thomson Reuters found it was the professional firms where AI usage was part of a well-defined strategy and that had implemented governance structures around AI implementation that were most likely to see gains from the technology. Interestingly, among firms where AI adoption was less structured, 64% of those surveyed still reported ROI from at least one use case, which may reflect how powerful and time-saving these tools can be even when used by individuals to improve their own workflows.The biggest factors holding back AI use cases, the respondents said, included concerns about inaccuracy (with 50% of those surveyed noting this was a problem) and data security (42%). For more on how law firms are using AI, check out this feature from my Fortune colleague Jeff John Roberts.
Mind the gaps
Here are a few tidbits from the conference worth highlighting:Mari Sako, the Oxford professor of management studies who helped organize the conference, talked about the three gaps that professionals needed to watch out for in trying to manage AI implementation: One was the responsibility gap between model developers, application builders, and end users of AI models. Who bears responsibility for the model’s accuracy and possible harms?A second was the principles to practice gap. Businesses enact high-minded “Responsible AI” principles but then the teams building or deploying AI products struggle to operationalize them. One reason this happens is that first gap—it means that teams building AI applications may not have visibility into the data used to train a model they are deploying or detailed information about how it may perform. This can make it hard to apply AI principles about transparency and mitigating bias, among other things.Finally, she said, there is a goals gap. Is everyone in the business aligned about why AI is being used in the first place? Is it for human augmentation or automation? Is it operational efficiency or revenue growth? Is the goal to be more accurate than a human, or simply to come close to human performance at a lower cost? What role should environmental sustainability play in these decisions? All good questions.
Not a substitute for human judgment
Ian Freeman, a partner at KPMG UK, talked about his firm’s increasing use of AI tools to help auditors. In the past, auditors were forced to rely on sampling transactions, trying to apply more scrutiny to those that presented a bigger business risk. But now, with AI, it is possible to run a screen on every single transaction. But still, it is the riskiest transactions that should get the most scrutiny and AI can help identify those. Freeman said AI could also help more junior auditors understand the rationale for probing certain transactions. And he said AI models could help with a lot of routine financial analysis.But he said KPMG had a policy of not deploying AI in situations that called for human judgment. Auditing is full of such cases, such as deciding on materiality thresholds, making a call about whether a client has submitted enough evidence to justify a particular accounting treatment, or deciding on appropriate warranty reserves for a new product. That sounds good, but I also wonder about the ability of AI models to act as tutors or digital mentors to junior auditors, helping them to develop their professional judgment? Surely, that seems like it might be a good use case for AI too.A senior partner from a large law firm (parts of the conference were conducted under Chatham House Rules, so I can’t name them) noted that many corporate legal departments are embracing AI faster than legal firms—something the Thomson Reuters survey also showed—and that this disparity was putting pressure on the firms. Corporate counsel are demanding that external lawyers be more transparent about their AI usage—and critically, putting pressure on legal bills on the theory that many legal tasks can now be done in far fewer billable hours.
Changing career paths and the need for AI expertise
AI is also possibly going to change how professional service firms think about career paths within their business and even who leads these firms, several lawyers at the conference said. AI expertise is increasingly important to how these firms operate, and yet it is difficult to attract the talent these businesses need if these “non-qualified” technical experts (the term “non-qualified” is simply used to denote an employee who has not been admitted to the bar, but its pejorative connotations are hard to escape) know they will always be treated as second-class compared to the client-facing lawyers and also are ineligible for promotion to the highest ranks of the firm’s management. Michael Buenger, executive vice president and chief operating officer at the National Center for State Courts in the U.S., said that if large law firms had trouble attracting and retaining AI expertise, the situation was far worse for governments. And he pointed out that judges and juries were increasingly being asked to rule on evidence, particularly video evidence, but also other kinds of documentary evidence, that might be AI manipulated, but without access to independent expertise to help them make calls about what has been altered by AI and how. If not addressed, he said, this could seriously undermine faith in the courts to deliver justice.
There were lots more insights from the conference, but that’s all we have space for today. Here’s more AI news.Note: The essay above was written and edited by humans. The news items below are curated by the newsletter author. Short summaries of the relevant stories were created using AI. These summaries were then edited and fact-checked by the author, who also wrote the blurb headlines. This entire newsletter was then further edited by additional humans.
Jeremy [email protected]@jeremyakahnWant to know more about how to use AI to transform your business? Interested in what AI will mean for the fate of companies, and countries? Then join me at the Ritz-Carlton, Millenia in Singapore on July 22 and 23 for Fortune Brainstorm AI Singapore. This year’s theme is The Age of Intelligence. We will be joined by leading executives from DBS Bank, Walmart, OpenAI, Arm, Qualcomm, Standard Chartered, Temasek, and our founding partner Accenture, plus many others, along with key government ministers from Singapore and the region, top academics, investors and analysts. We will dive deep into the latest on AI agents, examine the data center build out in Asia, examine how to create AI systems that produce business value, and talk about how to ensure AI is deployed responsibly and safely. You can apply to attend here and, as loyal Eye on AI readers, I’m able to offer complimentary tickets to the event. Just use the discount code BAI100JeremyK when you checkout.
This story was originally featured on Fortune.com
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