Middle-market businesses are tapping AI and automation to expand their operations in the short term.  

Fifty-four percent of middle-market businesses will integrate some form of AI in the next six months, a 10% year-over-year increase from the fourth quarter of 2023, according to KeyBank’s Middle Market Sentiment report, released last week. 

According to the National Center for Middle Market (NCMM), the middle market is defined by companies with annual revenues between $10 million and $1 billion.

Post-pandemic, middle-market businesses had to become more resilient, and leaders now prioritize technology, Ken Gavrity, head of commercial banking at $185 billion KeyBank, told Bank Automation News. 

“There’s a pressure now among these leaders [who are saying], ‘I’ve got to be able to figure out what my AI strategy is,’” Gavrity said. “And that’s a very quick flip to [this] idea of, ‘How can it affect my business?’ to ‘I need to have a framework in place. I need to be able to show some results.’” 

Business uses for AI

The more than 700 middle-market businesses surveyed in the report pinpointed where AI would be useful within their operations: 

• 65%, data analysis; 

• 60%, cybersecurity or fraud management; 

• 57%, data processing;  

• 52%, automating employee tasks; and 

• 51%, inventory management.  

As AI adoption strengthens, the businesses reported some pain points, Gavrity said. In fact, the report notes that 32% of companies saw cybersecurity or fraud affect business in the past 12 months. Of this number, more specifically: 

• 48% reported phishing or spoofing emails; 

• 44% reported data corruption; and 

• 37% reported identity theft. 

“The growing dependence on digital infrastructure is a double-edged sword, creating operating efficiencies and better client experiences. But it also comes with increased potential for cybersecurity and fraud if not managed correctly,” Gavrity said.