Generative AI: Three CXO challenges and opportunities

Infrastructure, data governance and culture change provide CXOs with a leadership step change, writes Rowen Grierson, Senior Director and General Manager at Nutanix.

It is clear that generative AI will be a major step change in enterprise technology. For technology CXOs, step changes pose as many business challenges as they do opportunities. If organisations are to benefit from artificial intelligence (AI), then they need a technology infrastructure fit for purpose, a new culture, governance – especially around data – and a new relationship with technology.

The hype around AI has led to technology leaders, once again, being in the spotlight. Technology CXOs are expected to navigate the adoption of AI across the organisation; a Vanson Bourne study finds that 90% of organisations have made AI a priority, and technology analysts Gartner stated at their Symposium event recently that 51% of CEOs expect the CIO to lead their AI strategy. Technology CXOs are trusted to ensure AI is a business success.

Creating that success means CXOs have to analyse and implement AI where it will make a difference to the typical operations of the business, but also where AI could completely change the business. AI will, therefore, do two things to organisations: it will accelerate the automation of everyday tasks, cutting the amount of manual and repetitive – and typically not value-adding – tasks that skilled team members do. But AI is more than an automation tool, as has already been seen with its ability to diagnose illnesses from large data sets, predict rogue waves that can sink ships or communicate on a human level; AI will create new business models.

CXO Focus 1: AI needs infrastructure

These opportunities will only be achieved in organisations that have the technology infrastructure in place. Our Vanson Bourne study found that many organisations are yet to determine which technology environment is best suited to run the different parts of an AI process and workload. Part of that challenge is that organisations are yet to decide which AI applications are most suited to their business and vertical market. This is understandable, as the pace of development is rapid, and GPT5 is already on the horizon.

Just as with mobile and cloud computing, AI will trigger a wave of technology infrastructure modernisation. For organisations to extract business value from AI, they will require an interconnected data environment. So it is no surprise to learn that more than half of CXOs say they need to improve their data transfer abilities between multi-cloud, data centre and edge computing environments. The same study finds that most CXOs cannot pinpoint the infrastructure modernisation plan needed to support AI workloads.

At present, over half (63%) of organisations are deploying AI on virtual machines, and a similar number (62%) have deployed AI in a container environment. Investment and modernisation of technology infrastructure is going to become a continual and long-term programme for technology leaders in order to meet the expectations of AI users. That is already being borne out; our study found that 85% of organisations plan to increase their infrastructure modernisation over the next one to three years in order to support AI initiatives. A similar number (84%) plan to increase the headcount of data engineering and data science teams, with AI prompt engineers joining their ranks.

This gold rush towards AI-optimised organisations will not forego the need for technology CXOs to be budget-conscious. We find that 90% of CXOs, unsurprisingly, expect their IT costs, and in particular, cloud to increase as a direct result of AI implementations.

CXO Focus 2: Governance

Tasked with leading the AI opportunity for organisations, technology CXOs are also worried about the implications of AI. The majority (90%) are concerned about data security, governance and data quality.

If organisations are not already confident about their data governance, then they may fall behind in the AI race. The Digital Leadership Report by Nash Squared, one of the most influential temperature checks of global CXOs, finds that only one in four digital leaders is very effective at using data insight; it adds that many organisations are still having problems defining a basic data strategy.

Technology CXOs tell us that over the next two years, data modelling and data security governance challenges will be high on their agenda. Over half (51%) say that adding data protection and disaster recovery will join their AI governance plans. This tallies with the findings of the Digital Leadership Report, which states that 36% of CXOs are concerned about data privacy being compromised by generative AI implementations. A quarter of CXOs are also worried about hallucinations in the data, which could impact customers and, therefore, the brand value of the business.

Given these challenges, it is not surprising to see technology CXOs opting for pre-built Large Language Models (LLM). These existing models from trusted providers, including AWS, will enable CXOs to increase the speed to market for AI solutions and may provide ways to increase the utilisation of existing resources. Given that many CXOs tell surveys they have concerns about their own data, buying LLMs provides room and time to build and not delay the usage of AI.

CXO Focus 3: Culture change

“Technology is the easy bit” is a common refrain of CXOs, the real challenge for business technology leaders and their organisations is the culture change – the same will be true of generative AI. The conversational and wide abilities of generative AI make it both an easy tool for end-users to engage with, but also an increased security risk. Employees can be uploading intellectual property or customer data with ease, instantly exposing the business to regulatory and market risk.

That same conversational ability will herald a new relationship that business end-users have with technology. At the Symposium, Gartner technology analysts advised CXOs to consider AI not as a technology to be implemented in the traditional sense but as a co-worker that, just as with any colleague, has to be interviewed and coached on the culture of their team and organisation.

AI will be a step change in enterprise IT. It will, therefore, also be a step change in technology leadership. To achieve AI success, organisations will need the right infrastructure, governance and culture in place. These three require an understanding that AI is a business issue and not one solely for IT to resolve. Therefore, enterprise AI adoption will be a marathon, not a sprint.

Rowen Grierson is Senior Director and General Manager at Nutanix

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