In this part of Institute for Experiential AI Executive Director Usama Fayyad’s takeaways from conversations with executives and leaders at VentureBeat Transform, Usama shares his thoughts on the second of three roundtable discussions that he participated in, where attendees discussed how tech teams are talking to their boards and C-suites about how generative AI can be leveraged safely and aligned with the company’s overall goals and objectives.
Roundtable: How the C-suite views generative AI
This roundtable discussion brought together a very engaged group of attendees. The main theme was the importance of explaining and demystifying the technology from an executive and board perspective. I shared my experiences discussing the technology with boards of directors and executive teams at large enterprises (as well as heads of funds and limited partners of large private equity firms) in terms that made sense to those audiences.
During the digital transformation, everyone saw some very established companies—think Kodak and JCPenney—go out of business, even though they’d been around for more than a century, because they didn’t embrace that transformation fast enough or correctly. There’s a similar fear with AI and a lot of urgency. Shareholders might ask if boards are “missing the boat” because competitors adopted something that has the potential to replace their business. This FOMO (fear of missing out) is a genuine concern for boards that want to insure this missed opportunity does not happen on their watch.
The discussion brought out great points on governance, regulation, identifying risks and tracking those risks, and finished with a discussion of inflated expectations in the minds of board members and executives. Those unrealistic expectations are the result of the hype around generative AI’s capabilities and competitive threats. LLMs can’t reason. LLMs do not understand consequences. They can make silly mistakes. Educating the boards on the limitations of this technology is critical. LLM models are often called “stochastic parrots” because they have no understanding of what they say, they can’t tell you where their answers come from, and they will even propagate misinformation if it has enough frequency and buzz.
It is healthy and crucial for boards to pay close attention to AI. Historically, some boards were complacent or even asleep at the wheel, allowing executive teams to stick to traditional business practices without acknowledging technology advances. Challenging this inertia is very healthy since it can lead to a sudden and rude awakening, leaving everyone wondering what happened to the business. I discuss how business can avoid a reckoning like this in our on-demand webinar, Generative AI: How to Keep AI Human-Centric and Productive in the ChatGPT Era.