CIOs press ahead for gen AI edge — despite misgivings

Snap, LexisNexis, and Lonely Planet are also developing and training LLM models, each leveraging their own data stored on AWS.

“We are setting up the system using retrieval-augmented generation and prompt engineering alongside Anthropic LLMs on Amazon Bedrock to extract experiences that then fold up into itineraries [formed from] our corpus of print content,” says Chris Whyde, SVP of engineering at Lonely Planet.

Nasdaq, another AWS customer, is using LLMs to “create new kinds of intelligence reports for investors and corporate customers that leverage the company’s proprietary data sets and drive faster, more impactful content creation in Nasdaq’s marketing and communication teams,” says Nasdaq CIO and CTO Brad Peterson, who also noted in a recent interview with CIO.com that generative AI “represents the next generation of this technology,” and that Nasdaq will use it to expand its portfolio of financial SaaS products for identifying financial crime risks and enabling corporate boards to produce and consume presentations and required disclosures more efficiently.

Tom Richer, head of Google Business Group at technology services company Wipro, is also seeing rapid traction among CIOs eager to explore gen AI’s transformative potential. “To this end, many are conducting proof-of-concept projects to assess how generative AI can be leveraged to streamline IT operations, enhance data management, and improve decision-making,” he says.

The WiPro exec cited an example of a recent POC that a life sciences firm conducted using Google’s Gen App Builder to reduce contract management costs and improve agreement adherence to company policies.

“The prototype generated supplier agreements by leveraging structured prompts fed by the contract manager in adherence to policy,” Richer says. “The POC resulted in significant time savings for contract generation, clause searching and summarization, and overall accuracy in the contract management function.”

Meanwhile, established AI vendors are also moving quickly to offer advanced gen AI platforms to keep their customers close. Databricks, for instance, purchased MosaicML to enable its customers to employ LLMs in their AI applications. 

C3 AI, another established AI vendor, last month released an enhanced Generative AI Suite with 28 domain-specific gen AI offerings. According to C3, sugar producer Pantaleon is using C3 Gen AI to supplement sales forecasting, while Georgia-Pacific is using it for manufacturing process knowledge. Additionally, Flint Hill Resources is deploying the LLM-based platform for commodity trading optimization, while the US Missile Defense Agency is employing it to improve safety during steel manufacturing, according to C3.

Balancing risks, rewards

The rate of pilot testing and POCs — this early in the game — is quite high, particularly for a rapidly advancing technology deemed by Elon Musk and others as potentially “civilization” destroying. Musk and other technology luminaries earlier this year signed an open letter calling for a six-month pause in the frenzied race in AI development.

In his book The Coming Wave: Technology, Power, and the Twenty-First Century’s Greatest Dilemma, Mustafa Suleyman, co-founder of DeepMind (owned by Google) and now CEO of Inflection AI, warns about the combination of more advanced generative AI with synthetic biology. In a recent podcast, he further explained that generative AI could evolve into an “artificial capable intelligence” that will have full agency to make decisions independently of humans and at a scale far beyond what humans can comprehend.

To guard against this, Suleyman and others advocate for human involvement in strictly enforcing responsible use through frameworks and laws, much the way nuclear arms and biological weapons are managed. 

Yet, the intense focus on gen AI has only accelerated experimentation for CIOs and vendors, including Musk, whose xAI will reportedly enter the AI arms race.

“The companies I talk to are not worrying about whether they’ll create an evil genius AI that destroys the world,” says George Westerman, a senior lecturer at MIT Sloan School of Management. “They’re just trying to solve the business challenges they face right now.”

And for most CIOs that means enhancing productivity. Nearly 60% of respondents to Foundry’s AI Priorities Study 2023 agreed that gen AI will play a large role in employee productivity, with 55% saying that gen AI–infused products produce better business outcomes.

Power supply giant Generac is one company that’s all in on gen AI, says CIO Tim Dickson.

“We are now fully embracing generative AI, with three innovative pilots that are live,” he says. “First, we launched a private instance of GPT-3.5 for internal enterprise exploration. Next, we launched a customer service chatbot to answer customer call questions for our customer service reps. Lastly, we tapped into our data lake to enrich and tailor specific customer emails to drive the conviction of our products and ultimately increased sales. These three programs are already delivering value for the business.”

And doing so requires taking risks, he says, something he believe IT leaders must embrace to succeed today. “We are indoctrinating a culture of gen AI within the company,” he adds.

Still, the widening availability of gen AI to the public at large keeps many CIOs awake at night. Few enterprises have slammed the brakes, but no doubt it has led to a high emphasis on corporate guardrails, frameworks, and shared responsibility in the C-suite.

Security and privacy remain key concerns for IT leaders, according to Foundry’s AI survey, as are authenticity, bias, and explainability, with 24% of IT leaders concerned about misuse. While CIOs will be looked to for expertise in addressing these issues, CIOs need to make it clear they are not going to be the fall guys for minor errors, aka AI “hallucinations,” or for more serious consequences to the company and society at large.

Foundry / AI Priorities Survey 2023

“It’s about co-leadership. Not just having a seat at the table but CIOs want the business to be accountable and to share responsibility for the technology outcomes as well as the business outcomes,” says Mandi Bishop, a vice president and analyst at Gartner, who adds that CIOs also want co-ownership and co-delivery of generative AI applications by “fusion teams” that unite business and IT pros to work together in structured units.

The human side of the equation

For most business CIOs, the ley applications for gen AI in the near term are likely to be in customer support, content creation, data augmentation, personalized recommendations, and product design, according to Foundry’s AI Priorities Study 2023.

And for many the inroads will be gen AI enhancements in the platforms they already rely on, as enterprise software vendors increasingly announce new gen AI capabilities for their products.

For example, Teradyne CIO Shannon Gath, who recently participated in a generative AI forum at Northeastern University’s Roux Institute with about 30 Boston area CIOs to discuss AI strategy, says her company is using generative AI incidentally today, through security products with built-in gen AI capabilities, as well as through Bing Enterprise. But she knows that will change, saying in a recent episode of CIO.com’s Leadership Live that generative AI is going to remain a core transformational fabric for the business world and society over the next decades.

“It is very real. Everyone is touching it on a daily basis,” Gath said of her company’s use of gen AI, before adding a twist to a common concern regarding job displacement and gen AI: “Humans who are using generative AI will replace humans who are not using generative AI.”

That emphasis on interaction between human beings and generative AI–based intelligent machines in the near term is what will fuel business value — and prove to be the true disruptive force across industries. And here perhaps resides IT leaders’ impetus for pushing forward despite concerns over where all this will lead.

“Gen AI will be the defining technology of our time and the winners in leveraging this technology will win big,” Lonely Planet’s Whyde says. “The fear of falling behind is a major factor in technology leaders’ minds today.”

Still, as Whyde concedes, “some of the concern around risk of adoption of AI is distressing.” And with this he sums up the tough spot CIOs find themselves in — now and in the years to come.