CFOs take active role in GenAI strategy development

A recent survey by Gartner has revealed that 34% of Chief Financial Officers (CFOs) are actively involved in the development of generative artificial intelligence (GenAI) strategies within their respective businesses.

The Gartner CFO & Finance Executive Conference held in Sydney saw the release of a survey conducted amongst 822 functional business leaders in November 2023. The results showed that CFOs were numbered amongst the most involved c-suite executives in the planning and execution of enterprise GenAI strategies.

Alexander Bant, chief of research in the Gartner Finance practice, noted the increasing role played by CFOs in this field. "GenAI spend is expected to be five to eight times higher than last year at most organisations, and many CFOs are playing the role of copilot to ensure these investments drive measurable benefits and profitable growth without unduly increasing risk," he said.

Additionally, the survey revealed a higher involvement of other C-suite executives in GenAI matters: Chief Technology Officers (CTOs) at 55%, Chief Information Officers (CIOs) at 48%, and Chief Executive Officers (CEOs) at 45%.

Bant added, "CFOs know that GenAI strategies must be cross-functional. They are leaning in with their CIOs, CISOs and CDAOs. But many are going further than just partnership, and instead playing a leadership role in crafting a GenAI strategy that aligns with and enhances the business and financial strategy for the board, investors, and regulators."

The increasing significance of CFO visibility in the GenAI arena has led to the identification of three important stages of GenAI integration within organisations by Gartner's experts: Defend, Extend and Upend.

Defend

The defend stage is where organisations must pick the low hanging fruit offered by GenAI and develop proper governance and employee understanding on responsible use of the technology.

This should involve implementing tools with low barriers to adoption and finding quick wins with specific tasks. For example, providing employee access to productivity assistants, such as Microsoft Copilot and Google Workspace, so GenAI can be applied to relevant workstreams in a sanctioned and controlled way.

"Even though these kinds of tools may seem quite revolutionary, the low barrier to adopting them means they will quickly become table stakes for doing business," said Bant. "They will not give an organisation a sustainable competitive advantage."

Extend

The extend phase will cost more but will also have greater potential returns. This is where an organisation would invest in more customised applications of GenAI technology, tailored to its unique circumstances of value proposition.

For example, GenAI could possibly augment the capabilities of financial advisors in wealth management. This has the potential to extend a service currently only within reach of the wealthiest individuals, providing it to a mass market audience.

Upend

The final scenario is one where GenAI upends an organisation and disrupts its entire industry.

Bant concluded with a cautionary note for the attendees, "This is the game-changing stuff that can get very expensive, very fast. But it also comes with much higher potential rewards".