Dive Brief:
- Charles Schwab CEO and President Rick Wurster credited expanded AI use with boosting employee efficiencies and cost savings, during an investor call Tuesday.
- “Through these efforts and others, we’re able to drive down our cost per client account, which has decreased more than 25% in the last decade,” Wurster said, according to a Seeking Alpha transcript. Cost per account decreased nearly 50% correcting for inflation, the executive added.
- Employee use of the Schwab Knowledge Assistant grew by 90% in 2024. In the year ahead, the financial services company plans to continue modernizing processes and investing in AI to improve employee and customer experiences.
Dive Insight:
Enterprises entered last year expecting their AI efforts to deliver cost savings. Instead, most leaders encountered ROI hurdles and adoption roadblocks.
IT decision-makers that still haven’t reached ROI expect cost-savings down the line, according to IBM-commissioned research published in December. Some enterprises are trying to get ahead of the curve by prioritizing high-value use cases and scaling up successful pilots.
Like Charles Schwab, toymaker Mattel began exploring how AI could support its cost-saving initiative last year. Colgate-Palmolive also used AI to fuel revenue growth and trim costs in 2024.
While cost-savings is a goal across industries, the price tag on AI capabilities and tools can be steep. Analyst firm Gartner equated the risk of ballooning AI costs to that of security, estimating businesses could miscalculate AI costs by as much as 1,000% when scaling projects.
AI adoption has already driven an average bump of 30% in cloud costs in 2024, according to Tangoe. IT leaders also feel the pressure in software purchases. Nearly 80% of U.S. organizations experienced rising software costs in the past year with most blaming new features like AI, according to Forrester.
