Though generative AI is getting all the buzz, companies should be looking further ahead—to how AI might give them a competitive advantage five to 10 years down the road, according to AI expert Vilas Dhar. In a session at the 2024 NACD Summit, Dhar, president of the Patrick J. McGovern Foundation, a philanthropic organization that promotes the use of technology for social good, talked about why companies should tailor AI to their areas of expertise. CFO Brew caught up with him to hear his advice for CFOs.
You talked about how companies tend to be focused more on the short term and more on generative AI, and how maybe they need to be thinking further ahead. What should they be placing their focus on?
The way I enter this conversation is to say, what’s the strategic competence of a particular firm or business in their sector? What are they immensely good at, better than anybody else? And then to ask the question, how does AI change the way we think about that dominant competence?
If you think about the long-term sustainability of a business, if everybody’s just raising the floor by deploying these generative AI tools, a company that really wants to be a market leader has to invest in that specific intersection of what they know better than anybody else and how they build an AI that accelerates that.
What’s the most important thing for CFOs to know about AI right now?
It’s almost A Tale of Two Cities. There’s the short-term investments that we need to be making, because that’s raising the floor for all companies. And then CFOs have the unique position of having to think five or 10 years out and say, “Where do we invest in AI capacity today that really is a long-term investment?…How do we make the case for that, and how do we think about financial management of the organization so that we can protect our market competence 10 years down the road?”…We haven’t in the past asked [CFOs] to make projections about technological transformation. It’s a new skill I think CFOs are going to have to start building pretty quickly.
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In your session, you talked about the “missing middle” in the discourse around AI. Can you expand on that?
There’s the tech company leaders who come out with these incredibly optimistic “technology will solve everything” kinds of stories. There’s a very vocal movement of people who are called the “doomers,” who wanted to tell us about all the ways that these technologies might harm us. But what was missing was a question about how all of the rest of us, not the “boomers” and not the “doomers,” have to step in and make choices about how these tools are used, about how we invest in creating those tools, in making sure that they’re used ethically and responsibly. And it almost felt like that went by the wayside because of the emotional resonance.
But now we’re seeing it everywhere, from the White House in the Executive Order [to] corporate practice, where companies are beginning to say, “How do we invest in building AI that creates more trust with our stakeholders?” We’re seeing it in vendors and third-party suppliers who are saying, “How do we build AI tools that are useful for companies today?”