Executives and business leaders are constantly being told to embrace the latest technology, but receive precious little guidance on where or how to make the substantial and thoughtful investments required. Yet, there is tremendous pressure — from the external market as well as growing user demands — for executives to do something.
Close to nine in 10 executives responding to a PwC survey admit they struggle to measure the return on investment in new technology. The survey, conducted among 509 executives in August 2023, concludes they tend to “lose sight of the ultimate business outcome objective, and end up tempted by the latest bright, shiny objects,” the PwC authors note.
These days, of course, the bright shiny object is artificial intelligence.
Executives indicate that embedding new technologies into their business models was their top strategic priority over the next three to five years, PwC finds. A majority, 59%, say they will invest in new technologies such as cloud or artificial intelligence in the next 12 to 18 months. Nearly half (46%) say they’ll invest in generative AI.
More than two-thirds (67%) agree or strongly agree that they will use generative AI to support their business models. Interestingly, while chief information officers will oversee such efforts, this is just as likely to be within the domains of chief marketing officers.
Clearly, AI is becoming just as much the job of business executives as it is for technology executives. “Companies who are AI leaders have involvement all the way up to the CEO in steering strategy,” says John Roese, global chief technology officer for Dell Technologies. “The current AI capability set out there creates almost infinite opportunities to transform parts of their business.”
Lately, with generative AI, executives and managers have entered into a battle they did not expect to face at least for several more years. Executives and managers “don’t have enough money, people or resources to execute an infinite set of projects,” Roese adds. “They have to pick the opportunities they will execute first, that will have the biggest impact on their company. That decision has to be made by the leadership of their business. You have to pick the worthwhile battles.”
Executives are facing “a dilemma unlike never before,” agrees Andy Thurai, principal analyst with Constellation Research. “The monster pace of gen AI adoption — which is new that has not been seen before — is making them scramble.”
Most senior executives “were caught off guard without knowledge, budget, or even a strategy to adopt AI — gen AI in particular,” Thurai continues.
All corporate functions “need to be involved in AI projects because AI projects at their core are about a decision to operate parts of your business differently. Think legal, HR, finance,” says Roese. “For example, before AI, if we wanted to change our selling process, sales is the lead for that but you need finance support and legal support and IT support to power that transformation.”
Boards and executives are “putting pressure on their top IT leaders to competitively respond to AI as quickly as possible, yet manage the risks and expectations,” says Thurai. “At the end of the day, either procrastination or doing it wrong could not only cost them multi-million dollars but if done wrong it could also make them disappear.”
Yet, the options can be overwhelming, even with the support of seasoned technology leaders. “Senior IT executives are inundated by options on how to strategically activate AI at the core of their business especially given the choices in each category and how fast each of them is moving,” says Thurai. “For example, there are now about 38 solutions for code generation in English. with various strengths and weaknesses. While choosing them on technical merits is an easy task, going beyond that to see how much it will fit their needs, and how it can fit their corporate governance, ethical, and legal standards is a far more difficult task. “
Think, for example, about potential legal and liability issues that may arise through large language models “trained by commonly available open source or sample code on the Internet,” Thurai cautions.
The PwC authors recommend that executives seeking to succeed with AI — or with any other technology for that matter — need to “keep business outcomes top of mind in order to drive tangible results on shorter timelines. Your ability to lower costs or improve margins can be the springboard for reinvesting any gains to reinvent your business.”
Acquiring talent — through training as well as recruiting — also needs to be a priority, both for executive as well as staff ranks. Organizations are “scrambling to hire AI-specific talent and ask for the right budget to help them engage in this journey,” says Thurai. “The talent they are looking for hire is diverse – from chief AI officer, who can own all AI initiatives across the board to talent to identify specific use cases to leaders who can execute to deliver the results to legal and corporate governance members who can look at the liability and corporate responsibility side of things.”
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