Artificial intelligence is transforming organizations, disrupting industries and redefining the roles of many leaders. According to Accenture, AI has the potential to add US$4.8-trillion to the global economy by 2022, representing a 38-per-cent increase in business profits. And that figure could grow as new applications are discovered.
We believe that CFOs are in an incredibly unique position to be the corporate champions of AI, and we recently hosted a dinner with the Institute of Corporate Directors (ICD) to help provide some perspective on this position.
This exclusive event included CFOs and Audit Chairs from some of Canada’s most influential organizations, as well as an incredible panel that included: Jodie Wallace, Managing Director, AI at Accenture, Eli Fathi, Co-Founder and CEO of MindBridge Analytics and Colleen Johnston, the former CFO of TD Bank Group.
The panellists shared their insights on the challenges Canadian organizations and Boards are facing with respect to AI adoption and implementation.
Canada’s Innovation Outpaces Business Adoption
While Canada has emerged as a front-runner in AI development and innovation, it seems that our businesses are not keeping pace. Despite being a hotbed for top tech talent and garnering significant investment and interest from global giants like Microsoft, Google and Amazon, Canadian business leaders are not keeping pace in terms of digital transformation and AI implementation.
In fact, a new report released last month by Forbes Insights, and commissioned by Accenture, SAS and Intel, suggests that Canadian businesses lag far behind other countries in terms of adoption and achievements. According to the research, Canada ranked last out of 10 countries, with just 31 per cent of adopters of the technology claiming successful AI deployment, compared with 59 per cent in India and 58 per cent in Germany.
When we posed this question to the panel, Jodie Wallace shared that, “Part of it, I think, is that the incentive frameworks don’t exist in Canada the way that is does in other parts of the world, and I think part of it is a general conservative nature and a desire to see proof of implementation.” She shared an anecdote of clients wanting to be leaders in innovation, but then also asking for multiple proof cases before deployment.
There is risk in being first, but there can also be a much greater advantage for those willing to try.
How Can Canadian Businesses Focus on What’s Important?
So, what can organizations do to take advantage of all the benefits that AI adoption can offer? According to our expert panel: first focus on defining the business strategy and then on how AI can help drive that strategy forward. Organizations need to be asking the right questions in the boardroom around the type of data that they need, and about which resources are required to make it work. They also need to be focused on ensuring that they have the right leadership in place to drive their business transformation.
Defining the Goal and Data Strategy
It’s hard to talk about anything AI related without first talking about data. Good data is the key to any successful AI implementation, and getting access to clean, effective data continues to be an issue for many organizations. When asked about how mid-market businesses should start with respect to their data, Eli Fathi responded, “The question that we should be asking is, is the data valuable or not? Not all data is good data and not all data is useful. You need to start by developing the data strategy. What paralyzes companies is the issue of privacy and ownership; who owns the data and what do we do with it?”
He continued by saying that organizations need to think about what they want to do and how to use the data to achieve that. Once you’ve landed on that strategy you can begin to think about building out your resources and team.
And while building the internal resources and capability is an option for businesses – it’s not the only way. Today’s organizations can also buy solutions, or even borrow existing technology and software to get started.
Jodie advised the room that there are so many incredible, innovative businesses, and “I’m trying to figure out how we can stimulate the connection between the incredible resources here in Canada and the companies that are looking for help figuring out how to start.”
She also pointed out that “there are many things that we can do with AI without having perfect data,” and that organizations can purchase or leverage other data to augment their own.
Building the Talent Strategy
While there is a growing list of software companies, like Salesforce or SAP, that can help organizations kickoff their AI journey, there are some additional benefits to building a team of resources rather than just leveraging service providers. When asked about an M&A approach to AI, Colleen shared that, “What you’re really buying is great talent, and it really is a talent imperative – having the talent that can go out and be a beacon for others within the organization and then you can really get some momentum. Good talent ups everybody’s game, and I think that’s a good thing.”
“It’s hard to get the best people, so how are you prioritizing that?” she asked the audience.
And the reality is that finding the right people is probably the greatest challenge impeding organizations. Having built strong teams of AI talent, Eli warned that, “Despite having incredible research facilities in Canada, it’s almost impossible to find people with all of the knowledge and expertise that you need,” but that it can be done. He advised organizations to first prioritize skills and hire the best people – like data scientist and developers, and then augment those resources by building and training a team.
Doing this takes a strong strategy, but it also takes great leadership. And at the end of the day, AI is ultimately still a leadership issue.
The Mindset of Our Leaders
“One of the issues that’s bogging things down these days is that there isn’t enough literacy at those senior levels,” warned Colleen. “So, when these tough topics come along-- and they do present risks and challenges-- I think a lot of senior decision makers don’t know how to make the decision.”
A brief poll of the over 80 leaders in the room quickly confirmed a consensus on this. While almost 70% of the evening’s attendees agreed that digital transformation was an important part of their organization’s growth, most CFOs and Audit Chairs were fearful of their ability to effectively navigate the shift.
When asked if Canadian CFOs are prepared to champion the next wave of technological change, a mere 11 per cent of polling respondents claimed they were well prepared or very well prepared – and the overwhelming majority of the room felt unprepared or somewhat prepared.
What’s more is that over 70% did not have confidence in their board’s ability and skillset to support a transformation either.
Closing the Gap
“We have to figure out how to get CFOs the right level of education to understand what we can do,” Jodie advised. “How do we get truly informed and build awareness and make it part of the personal mandate? It absolutely needs to start with the executives.”
There is a clear gap when it comes to the opportunities presented by AI and an organization being ready to harness the power of the technology. CFOs see a tremendous opportunity, yet they face a daunting challenge of legacy systems and disorganized data as a huge cost and impediment to success.
Our view is that CFOs have the skillset to take the lead on driving the business case for AI adoption. They are well positioned to help their organizations get out in front of this – and they must.
Today’s CFOs need to have the AI agenda top of mind or they risk viewing this from the sidelines. Or worse, face the chance that their organizations will lag behind their competitors or be disrupted.
Below is the full recording and some photos from the event. The full photo gallery can be viewed online here.
Tony Gaffney (Managing Partner, Odgers Berndtson) opens the event.
Rahul Bhardwaj (President & CEO, ICD) addresses the crowd.
Jodie Wallis speaks to the crowd about AI.
The panel and moderator from left to right: Ross Woledge, Jodie Wallis, Eli Fathi and Colleen Johnston.
High Performance in the Boardroom Needs Diversity and Inclusion (D&I): An Interactive Workshop for Potential Board Candidates
Odgers Berndtson's Calgary team and board practice specialists, Elaine Roper and Tony Gaffney rec...
An Interactive Workshop for Potential Board Candidates