Large Language Models (LLMs) such as ChatGPT are disrupting the finance world, as exemplified by Morgan Stanley’s experimentation with an OpenAI-powered chatbot to assist their financial advisors. Trained on the bank’s proprietary research reports, this bot grants rapid access to its extensive knowledge base.

Private equity firms and insurers were among the early adopters, utilizing these innovations for investment pre-screening and claims automation. As LLMs progressively permeate the finance industry, it is crucial to thoughtfully embrace and adapt to this transformative shift.

Substitutes or complements?

Amidst this backdrop, concerns arise regarding the potential obsolescence of finance professionals. However, this apprehension stems from an oversimplified view of AI as a mere substitute for humans. Large language models should be regarded not as replacements for skilled professionals, but rather as powerful tools that augment their capabilities.

By integrating AI-driven insights into human expertise, tools like ChatGPT can empower financial professionals to make better decisions, automate routine tasks, and maintain a competitive edge in an increasingly challenging market.

Both a productivity booster and an equalizer

Contrary to the conventional association of innovation with inequality, early evidence suggests that adopting LLM-enabled technologies has equalized the playing field in workplaces.

In call centers of major software companies, chatbots improved the productivity and quality of underperforming workers more significantly than that of “superstars.”

In separate studies, researchers conducted experiments and discovered that ChatGPT substantially enhanced the productivity of university-educated professionals in writing tasks, particularly benefiting those who were slower writers.

Lower cost, higher demand?

This surge in productivity has the potential to reduce service costs. Enhanced efficiency enables financial professionals to focus on high-value activities like client relationship management and strategic decision-making.

Furthermore, as technological innovations like LLMs make financial services more affordable and accessible, the demand for these services could increase due to newfound affordability and accessibility. Consequently, this may create a higher demand for financial professionals.

Revolutionizing knowledge sharing and flattening the organizational structure

The emergence of interactive LLMs democratizes access to knowledge, allowing individuals with varying levels of computer literacy to tap into vast repositories of information. Additionally, by utilizing this technology to mine emails, recorded discussions, and other resources, seamless sharing of organizational “know-how” becomes possible. This can lead to reduced specialization requirements and prompt a reassessment of traditional organizational structures.

Rather than viewing AI as substitute for human workers, we should recognize its potential to lower service costs and increase demand for financial services. By making professional advice more accessible, we could create a world that necessitates a greater number of financial professionals.

How should professionals prepare?

To prepare for the impact of large language models, finance professionals (as well as professionals in other industries) should focus on developing organizational AI literacy. Here are some steps to consider:

• Encourage entry-level professionals to utilize models like ChatGPT, providing training to help them understand the strengths and limitations of the technology.
• Formulate a strategy to convert institutional knowledge and culture into easily accessible information with the assistance of LLMs.
• Anticipate initial impacts on work efficiency and quality, addressing any discontent among “superstars” who may not benefit as much from the technology.
• Rethink team organization, leveraging decreased specialization requirements to create more adaptable and versatile structures.
• Alleviate apprehensions about AI by highlighting its potential to enhance overall productivity and job satisfaction.

Ultimately, the integration of LLMs into the finance sector holds the potential to revolutionize how professionals access and share knowledge. By embracing AI and adapting to its implications, finance professionals can secure their positions in a rapidly evolving industry.