Generative Artificial Intelligence Gaining Traction Despite CFOs' Hesitancy, Survey Finds

The Rise of Generative AI in Corporate Finance

As the demand for generative artificial intelligence (AI) continues to increase, companies are embracing the transformative potential of this technology. Nvidia CEO Jensen Huang recently unveiled a new generation of AI chips, expanding the reach of AI beyond the tech sector with new deals involving companies like Johnson & Johnson and GE Healthcare.

Despite the growing interest in generative AI across various industries, many CFOs have been hesitant to fully embrace this technology due to concerns about return on investment and overall cost management. According to the CNBC CFO Council survey for the first quarter of 2024, only a third of respondents expect an increase in their company's capital expenditures over the next 12 months. Even among this group, a mere 7% anticipate allocating funds for new AI capabilities, ranking below other investment priorities such as expanding into new markets and building new facilities.

Adopting Generative AI in Finance

Despite the initial hesitation among CFOs, several business software providers have introduced new tools specifically designed for finance teams, showcasing successful examples of how these tools have improved efficiency. For instance, Microsoft's Office of the CFO reported significant time savings in tasks such as reconciliation and variance analysis, thanks to new AI-driven tools. Microsoft's recent launch of a Copilot chatbot for finance workers has further streamlined processes, demonstrating the practical applications of generative AI in finance.

Moreover, the utilization of generative AI is not entirely new for CFOs, as predictive AI tools have been widely used to assist with core financial tasks for nearly a decade. The recent surge in generative AI, however, presents a unique opportunity for CFOs to enhance operational efficiency and drive innovation within their respective companies.

Overcoming Challenges and Resistance

While the introduction of generative AI tools presents exciting possibilities, companies are facing challenges such as creating auditable processes and ensuring the accuracy of data and conclusions. Additionally, concerns about a lack of compelling use cases, the fear of implementation, and the need for specialized skills have contributed to some hesitation among CFOs.

Resistance to adopting these tools has also been observed, with some companies expressing concerns about the potential overlap with existing human-dependent processes. However, industry experts emphasize the importance of clearly defining business goals and objectives to ensure successful implementation and maximize the value of AI investments.

Driving Productivity and Efficiency

Salesforce CFO Amy Weaver highlighted the importance of leveraging AI technology to drive productivity and efficiency within finance teams. She emphasized the need to empower employees by freeing up time through the use of new technology, ultimately making jobs more satisfying and impactful. Weaver also stressed the significance of adopting generative AI as a new skill that finance teams must develop, encouraging intentional daily usage of AI tools.

Demystifying Generative AI

Gina Gutzeit, senior managing director at FTI Consulting, emphasized the need to demystify generative AI, framing it as just another tool in the CFO's toolbox. She emphasized that generative AI should be viewed as a means to enhance productivity and streamline mundane tasks, rather than the "beginning of the end of everything."

The Path Forward

As companies continue to navigate the evolving landscape of generative AI, CFOs and finance teams will need to adapt to this transformative technology to drive innovation and efficiency. With the right approach and clear objectives, generative AI has the potential to revolutionize financial processes and empower finance teams to focus on strategic, high-impact work.