McKinsey CFO on AI: We’re Just at the Beginning


January has ushered in a landmark year for corporate artificial intelligence budgets, with 66% of companies increasing their budgets and only 4% decreasing those budgets, according to a recent study by Spiceworks and Aberdeen Research.

Altogether, worldwide spending on artificial intelligence software, hardware, and services will increase 27% this year to reach $154 billion, according to the International Data Corporation (IDC).

Additionally, approximately half of U.S. chief technology officers say AI represents their “number one budget priority” according to a recent CNBC survey of senior IT executives.

Yet CFOs likely won’t get the results they expect unless they stand up and lead their teams and their companies into a new era of technology insight.

That’s the takeaway from a recent Fortune webinar with financial decision makers from McKinsey, Kickstarter, and Workday (among others) presenting.

At the webinar, McKinsey & Company CFO Erick Kutcher said chief financial officers need to take the reins on AI deployment, and they’ll need to be properly educated on technology to handle the job.

“If you look at the role of the CFO today, which in many ways is a core component—if not the strategic architect—of an institution, you have to look at the opportunities around technology,” Kutcher said. “If we’re going to drive growth and productivity … technology probably becomes the number one source of that productivity.”
Understanding how deeply technology is embedded in a company in this, age of AI is paramount, Kutcher says.

“It’s hard to be leading an organization of the size and scale we all do if we’re not at the forefront,” he told the webinar audience.

Moving Beyond the Traditional CFO Role

CFOs can no longer settle for being only financial controllers as a massive artificial intelligence-powered technology shift is underway across the business landscape.

Instead, corporate finance leaders need to become “innovators”, that take a “pro “investment” outlook on AI innovation inside the company, Kutcher says.

That stance should lead to CFOs asking – and getting answers to – key questions.

“(For example) how do we evolve our firm or institution to enable us to do the things that are strategically important—much of which has an innovation component to it—and how do we create the economic model to do that?,” Kutcher asks. Getting that question answered right can help a CFO move on from basic “cost containment” to becoming a technology innovator inside the company.

Kutcher advises CFOs to pick up the phone and talk to company CIOs and CTOs and “see what they’re doing personally and professionally.”

Additionally, CFOs should be “encouraged to work closely in partnership with technology leaders . . . practice that can help leaders identify shared opportunities, whether it’s around AI or other advances in technology,” Kutcher said.

Kutcher said CFOs don’t have a choice with artificial intelligence rising. Either innovate or get out of the way.

“We’re just at the beginning, but I think this is the biggest sea change we will see not just in finance but in business at large,” he added.

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