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Generative AI for CFOs – stay close, apply gently & keep learning  

HB Notes

If AI is the game changer, then Generative AI’s potential is to revolutionise finance operations and the role of the CFO. This has yet to happen, but it will. Will it be better to be ‘a fast changer’ or ‘a slower up scaler’?

Over lunch Hoggett Bowers brought together a group of CFOs to discuss what they are seeing in their businesses and to what extent they are embracing Generative AI, today. The key takeaways are:

1 – Deploying AI where it makes most sense – Our guests shared how they are seeing best use cases where large pools of data exist. The data enables improved understanding of travel & transport operators, customer patterns, fraudulent behaviour, fleet utilisation and thereby network optimisation. Broader industries and utilities see enormous opportunities for generative AI to interpret data, understand volumes, utilisation, flow and within that opportunities to redirect and minimise the negative impact on the consumer in event of an emergency.

In more tech led industries, naturally, the appetite for AI is greater across the board, particularly with software and technology centred services. The consensus was AI is a good thing and certainly will be embraced but deployed at a cautious pace. 

2 – Leadership of AI and talent – Generative AI is an emerging area of expertise. Who do organisations turn to, to lead the ongoing development to maximise the opportunity for Generative AI to add value, when the deployment and expertise is in its infancy? For now, organisations are mostly ‘developing’ their own talent by appointing leaders with elevated levels understanding of AI and Generative AI, as well as curiosity and open mindedness to push boundaries. With these characteristics individuals are selected to be the focal point to explore how collaborative AI can be deployed most effectively.

Typically, these leaders have credibility with both technology and finance, comfortably pivoting between both departments, safeguarding the interests on both sides, and aligned to the overall corporate priorities. As generative AI becomes mainstream, we will see an increase in Generative AI specialists, but for now, the message was to ‘stay close and keep learning’, as the knowledge of how to best use Generative AI matures.

3 – Humans vs Machines – Across the board it was noted that judgement, insight, and wisdom will still play the significant role in how business make their strategic decisions and in no way is AI able to replicate and replace the experiences CFOs and other leaders possess in today’s businesses. In this respect, it was agreed, that overall, AI is additive, with more benefits to come, recognising that over time it will become a key tool in both strategic and tactical decision making.

What is clear, is that most businesses have already embraced the use of standard AI in areas of people intensive processes and high-volume outputs at a tactical level, in the pursuit of efficiency. In the service and consumer industries there were two distinct patterns: For day-to-day run of the mill registration, interaction and query solving, the customer is typically familiar, and comfortable with, the digital processes AI (Chat bots etc) and happy to engage. However, in the event of a more critical event, it is clear there is an absolute requirement for human support, for the empathetic voice and the decisive response. 

4 – Hurry up and wait – Caution was cited against rushing in and investing heavily, as what looks good today may trigger a political response and become obsolete tomorrow. Secondly, macro, geopolitical activity will also play a role in how regulation of Generative AI will play out, as all the current major players in the field want to ensure they are on the right side of history and in doing so is embracing the discussions on regulations. Additionally, with new areas such as ChatGPT, if you do not manage your data and content effectively you could be exposing the business to unnecessary risks. Reputational damage is a clear concern.

Finally, internally in business, there appears to be two evolving camps. The technology office wanting to ‘go now’ and go quickly whereas the CFO and CEO offices feel rushing ahead is the wrong thing to do, for now. It appears, the blended approach will be the path for most where it concerns Generative AI. 

It is imperative that organisations push ahead explore the wide range of untested opportunities which come with using generative AI solutions. The importance of risk mitigation is equally high on any board agenda, not just with the CFO’s mandate. It will be critical when considering the uncertainties which adopters and developers are faced with in this rapidly evolving field.

A balanced approach is deemed the best course of action at this early stage and being risk adverse, for now. However, businesses must develop the necessary knowledge at pace, and begin to take decisions on how to integrate generative AI into their business or product offerings, or face being left behind.

Acknowledgements


Hoggett Bowers are very grateful to all our guests and a special thank you to:

Andrew FarmerCFOSouth East Water
Caroline GardnerCFOEgencia & American Express Global Business
Catherine GanCFO & AdvisorEO Charging
Claire WattCFOCommunisis
Natalia TyagounHead of FinanceLHV Bank
Niall DoreCFOFindmypast
Peter CharlesInterim CFOCarpetright plc
Richard HarrisonCFOOLR Holdings
Flemming HansenPartnerHoggett Bowers