Lessons from the Virtual Table (Pt 1) - Embracing Artificial Intelligence in Insolvency Practice: Thriving in a VUCA World

As promised, this is the first instalment of my lessons from the recent INSOL International Africa Round Table Conference on insolvency.

“VUCA” was a strange word I heard Maurice Conti , the Keynote Speaker, mention during his presentation on Artificial Intelligence. The term means Volatility, Uncertainty, Complexity, and Ambiguity. It is a term that aptly describes today’s rapidly evolving world, especially in the context of artificial intelligence (AI). The technological progress of the past 20 years has exceeded the cumulative advancements made since the first Christmas over 2,000 years ago. This unprecedented pace is reshaping industries, including insolvency practice.

In this highly volatile environment, it is crucial to develop three foundational elements: the right mindset, toolset, and skillset to leverage AI effectively.

Mindset

AI is here to stay, and its impact will bring about significant business transformation. As businesses and professionals, we have two choices: ride the AI wave or be washed away by it. However, using AI effectively begins with problem identification. AI can generate solutions, but unless we clearly define and understand the problem, we cannot address it strategically or effectively. In all this, it is important to remember that we are to collaborate with AI rather than delegate our work to it. AI tools complement our expertise; they are not a substitute for critical thinking or responsibility.

Toolset

Once you have the right mindset, you now need the right tools to work.

• Simplifying arduous tasks: Generative AI tools, such as ChatGPT, are already widely used to produce human-like text. In insolvency practice, this can simplify laborious tasks like drafting case briefs and writing detailed reports. They can also be used to automate notices and client communication. OtterAI assists with meeting notes and transcription. These tools free up the practitioner to focus their energy on high-value analytical work.
• Financial analysis: ChatGPT can also be leveraged for financial analysis, such as calculating interest on payments and helping to assess the pros and cons of various payment plans or restructuring options. By processing complex data quickly, ChatGPT enables professionals to simulate different scenarios and gain insights into potential outcomes, allowing for more informed decision-making.
• High-quality visuals: But AI doesn’t stop at text. Tools like DALL·E can create high-quality visuals from simple descriptions. This is ideal for presentations or marketing materials. For professionals in creative industries or branding, the ability to visualize concepts instantaneously opens new doors.
• Wide reach, more inclusiveness: AI has revolutionized communication, enabling professionals to bridge language barriers and reach a wider audience. Tools like Synthesia allow users to create personalized video messages in multiple languages, ideal for cross-border insolvency or client communication. Similarly, DeepBrain AI generates hyper-realistic digital avatars for virtual interactions, adding a human touch to remote and hybrid work. Papercup translates and dubs videos into various languages, making it easier to repurpose content for global audiences. Meanwhile, Descript enhances accessibility by providing audio-to-text transcription and subtitles, ensuring inclusivity and improving collaboration across borders. These AI tools make it possible to seamlessly communicate with international stakeholders and expand your professional reach.

Skillset Adopting AI requires the right skills, primarily prompt engineering. Most generative AI tools require prompts to produce output, and the quality of the prompt significantly impacts the results generated. However, beyond prompts, it is also important to understand the range of tools available and their specific applications. AI is not necessarily replacing jobs; it is replacing tasks. It is your responsibility to decipher the task to be performed and the best AI tool to use.

Lastly, it is crucial to use AI in a manner that safeguards professional and client confidentiality, avoids data breaches, and adheres to ethical and legal standards. This area is critical and will be discussed in Part 2 of this article on Responsible AI.

Conclusion As insolvency practitioners, embracing AI is not just an option—it’s an imperative. By equipping ourselves with the right mindset, toolset, and skillset, we can navigate this VUCA world and ensure we remain at the forefront of our practice.

How do you see AI reshaping insolvency and related fields? I’d love to hear your thoughts in the comments below.

#ArtificialIntelligence #AIinBusiness #DigitalTransformation #Insolvency #GlobalReach