How Artificial Intelligence Has Disrupted the Retail and Financial Services Industry Article

Open, View, and/or
Download this Document

Total Length: 3112 words ( 10 double-spaced pages)

Total Sources: 10

Page 1 of 10

Technology has fundamentally changed the manner in which business, commerce, and networking are conducted. Innovations related to data analytics and artificial intelligence have expanded the realm of possibilities for a range of industries from automobiles to energy. With these revolutions come a host of uncertainties as well. Forecasting the future has simultaneously become more predictable but more uncertain. Likewise, technology has become more secure but also much more dangerous. With each new iteration of technology, new advances in products, goods and services emerge. This has ultimately ushered in a new wave of prosperity not seen since the industrial revolution, where nearly all market participants are impacted. Through these innovations however, it is important for consumers to be cognizant of the impacts of artificial intelligence on information and security management (Li, ).To begin, as noted in the introduction, technology has altered nearly every industry across the world. To better understand in the impact of artificial intelligence on information and security management, it is important to understand how technology is implemented in society. The pace of innovation around the world in unprecedented. With these technological changes, industry disruption occurs. A classic example, current underway is that of the financial services industry (Hu, 2018).Traditionally, the financial services industry was relatively stable and entrenched industry in society. Banks often acted as intermediaries between investors and savers. As an intermediary, banks would facilitate the exchange of capital between entities through various forms and products. Historically, consumers would deposit funds in a bank. In exchange for the deposit, banks would pay an interest rate to the consumer who depositing funds into the bank. While funds where deposited, the bank would then lend a portion out, keeping a small portion as collateral. The funds that were lent would come in various forms including mortgage loans, auto loans, and other products. The difference between the interest rate banks paid to depositors and the interest rate they received from lending funds to consumers was known as net interest margin. So long as the bank operating prudently and had strong risk management policies, the bank would continue to make stable profits and grow. The ability for banks to act as financial intermediaries for most of the worlds most important transactions has continue for decades as this was, at the time, the only way to safely and securely transfer capital from those who don’t need capital (savers) to those that need capital (Borrowers). These functions where exacerbated during establishment of the capital markets. Here, investors looking to raise capital to expand a business could only do so by leveraging the expertise of an investment bank. Here, the investment bank would then go to the capital markets and raise funds in the form of an IPO. Much like the lending example above, the ability to raise capital was solely under the jurisdiction of financial intermediaries of banks. Overtime, as these functions grew so too did the concentration of market share with the banking industry.

Stuck Writing Your "How Artificial Intelligence Has Disrupted the Retail and Financial Services Industry" Article?

View All Our Example How Artificial Intelligence Has Disrupted the Retail and Financial Services Industry Article

Have A Custom Example Essay Written

Here more commercial and investment banks began to take every larger portions of market share as consumers had little to no alternative. Here, a large physical branch network, nationwide ATMS, and a large teller staff where are needed by consumers. As a result, the largest banks where in the best position to offer these services (Zhu, 2015)Now however, technology is severely disrupting this business model. Fintech firms have emerged, heavily utilizing artificial intelligence, big data, and data analytics to fundamentally change the manner in which banking is offered. Here, these businesses employ a variety of information management techniques design to help them make quicker and much more accurate…

[…… parts of this paper are missing, click here to view the entire document ]

…who where compelled by the use of technology to disrupt the industry. As a result, many of the older financial institutions where forced to adopt artificial intelligence, big data, data analytics into their own business operations.The same concept occurred with retail, as firms such as Alibaba and Amazon use data analytics to serve customers in a manner that many of the older brands simply could not do. These investments as detailed above, including delivery robots, self-driving trucks, and automated warehouses. Each of which leverage data analytics, cloud computing, and artificial intelligence to delivery a differentiated experience that is unpatrolled in the retail environment. Even now the future is very bright as both Amazon and Alibaba both compete to further leverage the benefits described above related to artificial intelligence (Zhao, 2016).To conclude, one would be remiss to not discuss the security implication on artificial intelligence and the negative elements associate with it. Big data usage often requires trust. All stakeholders must be able to develop a certain level of belief within the system overall.The emergence of big data and data analytics has also been a very large catalyst on artificial intelligence and its impact on information and security management. Cybercrime and the ability of bad actors to access critical information has become much more prevalent. It is critical for those using artificial intelligence to properly protect their data and subsequent information. In general, AI is used to help audit businesses that use it process (Mustapha, 2017). These processes consist of five domains. The first domain focus first on auditing information systems. The second domain focuses on governance and management. The third domain focuses on system acquisition, development and implementation. The fourth domain focus on operations and the fifth domain focus solely on security. Each of these elements in critical to the auditing….....

Show More ⇣

     Open the full completed essay and source list


OR

     Order a one-of-a-kind custom essay on this topic


sample essay writing service

Cite This Resource:

Latest APA Format (6th edition)

Copy Reference
"How Artificial Intelligence Has Disrupted The Retail And Financial Services Industry" (2021, November 09) Retrieved June 4, 2026, from
https://www.aceyourpaper.com/essays/artificial-intelligence-disrupted-retail-2180857

Latest MLA Format (8th edition)

Copy Reference
"How Artificial Intelligence Has Disrupted The Retail And Financial Services Industry" 09 November 2021. Web.4 June. 2026. <
https://www.aceyourpaper.com/essays/artificial-intelligence-disrupted-retail-2180857>

Latest Chicago Format (16th edition)

Copy Reference
"How Artificial Intelligence Has Disrupted The Retail And Financial Services Industry", 09 November 2021, Accessed.4 June. 2026,
https://www.aceyourpaper.com/essays/artificial-intelligence-disrupted-retail-2180857
   

Open, View, and/or
Download this Document
order custom essay example