New Study: CFO’s Seem Split on Gen AI

A new study points to plenty of “wait and see” CFOs on Gen AI.

For a year loaded with volatility on the geopolitical, technology, energy, economic, and financial market fronts, chief financial officers appear to have taken all of 2023’s downbeat news in stride.

That after a new survey of 116 North American CFOs revealed that 57% of them rate current economic conditions as either “good or very good”, according to new data from Deloitte.

The 57% CFO satisfaction level is the highest since the opening quarter of 2022 when 64% of chief financial officers held a “positive” view of the economy. In the latest surveys, clear majorities of CFOs held an equally positive view over their own company’s financial fortunes – current and future.
That’s not to say CFOs don’t have a laundry list of concerns heading into 2024 – they do.

“Talent availability and retention land at the top of CFOs’ most worrisome internal risks this quarter, followed by execution and prioritization of business strategies,” the study noted. “Innovation and growth, along with data and technology, are the next most frequently mentioned internal risks.”
Other vexing issues for company financial decision-makers include team member engagement, staff morale, and overall cost management.

“Such concerns might reflect the difficulties some organizations are experiencing in the transition from the hybrid work model to on-site work arrangements, and the challenges of containing costs amid high inflation,” Deloitte reported.

Technology and AI in the Spotlight

The Deloitte report also pointed to heightened awareness and equally heightened activity on artificial intelligence, especially on the Generative AI frontier.

“With Generative AI in the headlines almost daily, our report’s “special topic” focused on CFOs’ views on the technology,’ Deloitte reported. “We found that a sizeable proportion of CFOs’ organizations (42%) are experimenting with Gen AI, while 15% are incorporating it into their business strategy.

Another 24% of CFOs said their executives are in the “reading and talking about” AI phase in late 2023.

What’s illuminating in the study is how many chief financial officers are still on the sidelines on AI in a year where the technology has regularly appeared in the headlines, as a conversation priority at bars and coffee shops, and at industry conferences and seminars.

“For nearly one-quarter of CFOs, GenAI is important to achieving their business strategy, compared to 42% who say the technology is not important overall,” the study notes. “That leaves more than one-third of CFOs not yet weighing in on whether GenAI is important or not to achieving their organizations’ business strategy. For 17% of CFOs, it’s too soon to tell where their organizations stand on its GenAI journey, but nearly one-quarter of CFOs indicate their organizations are reading and talking about it.”

Maybe more cautious CFOs are taking the old “don’t be first in line for a new 1.0 tech product” to heart with Gen AI. Certainly, many corporate financial leaders have unanswered questions and concerns over the technology.

In fact, over 50% of CFOs cite the impact of risk and internal controls, data infrastructure and technology needs, and investment needs as “big concerns” in the study.

“Governance requirements, ethical issues, and potential legal impact are also among CFOs’ chief concerns over GenAI, but to a lesser extent,” Deloitte reports. “Other responses included concerns over the accuracy and quality of GenAI outputs and data protection when using GenAI.”

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