Gen AI is more than a technological turning point

In March of 2023, KPMG initiated its 2023 KPMG Generative AI Survey to delve deeper into the realm of generative AI (gen AI) and unravel the practical avenues for enterprises to harness its true potential. The report draws its insights from a survey encompassing 300 executives hailing from diverse industries and geographic locations.

The survey indicates that executives expect generative AI to have a significant impact on workforces, but mostly as a means to augment, rather than replace, labour. They also understand that some types of jobs could be at risk and there are ethical considerations for how generative AI is introduced and jobs are redesigned.

Nearly three-quarters of respondents (73%) believe generative AI will increase productivity; 68% say it will change how people work; and 63% think it will encourage innovation. Over time, the technology could enable employers to fill the demand for highly skilled workers (a challenge today) and shift employee time from routine tasks, such as filling in forms and reports, to more creative and strategic activities.

Alert to the downsides

46% believe job security will be at risk when generative AI tools can replace some jobs. The most vulnerable positions, according to respondents, will likely be in administrative roles (65%), customer service (59%), and creative (34%). For example, the adoption of visual content-creating programs like Dall-E and Lensa could have a deep impact on marketing, design, and creative firms.

Whether generative AI is used for augmenting or automating knowledge-worker tasks, human expertise will be critical for harnessing generative AI capabilities to unlock real value.

Even now, companies are scrambling to build the capabilities to test, implement, and manage generative AI. Not surprisingly, the amazing “creative” powers of generative AI have raised alarms among workers and policymakers about job losses. Those concerns should not be ignored. But history has shown that when technology makes some tasks obsolete (like stenography), it creates demand for new ones.

What to do now?

With the market growing rapidly: Seven in 10 respondents (71%) expect their company to implement their first generative AI solution in six months to 2 years— adopting sooner rather than later promises true first-mover advantage. The accelerated pace of emerging technology change is likely to significantly widen the first-mover and fast-follower gap.

Find your generative AI North Star:  From an implementation, adoption, and evangelising perspective, leveraging existing AI investments and foundations can help put new generative AI implementations on solid footing. But the true success of generative AI will come when the institution as a whole refines its strategy to harness the unique capabilities and address the unique risks of generative AI — a transformation vision, or “North Star,” to aim for.

Respond and adapt: Leaders will need to be ready to quickly assess, adapt, or pivot the strategy to account for the enormous potential. The organisation will need to come together as a whole to consider the implications of generative AI on all aspects of its business. One best practice is to designate a single leader responsible for cross-enterprise coordination, focusing on finding efficiencies, learning from pilots, and prioritising investment.

Empower responsible use: A vital aspect of controlling evolving risks of generative AI usage will be establishing clear governance. From financial to reputational to ethical considerations, enterprises need strong guardrails in place to limit the risks of generative AI. Having accountability from various business, risk, and governance leaders who will think through potential risks is essential.

Address critical talent questions: Big changes usually create fear and uncertainty. To minimise these effects, leaders will need to expertly manage communication about shifting jobs, reengineered processes, and new behaviours. Most enterprises want to scale their operations, and what better way to achieve that than by increasing the productivity of the existing workforce?

Develop generative AI literacy: Debunking myths will be critical to helping both leaders and employees from falling into an isolationist mindset. Education, experimentation, and a positive culture of responsible adoption will all be essential to pave a path of growth with generative AI.

Unleash generative AI broadly: Systematic, top-down adoption of emerging technology is a safe, well-tested approach.

Manage change boldly and broadly: Generative AI is more than a technological turning point. It is changing everything — how we think, create, work, interact, and live. Confronted with the most disruptive technology of our lifetimes, business leaders face a critical question: How do we deploy generative AI in a way that prevents the worst, and harnesses the best? This will require an extraordinary and unparalleled change effort.

Many leaders have not had to manage change of such magnitude, at such speed and scale, or with such consequence. Success will require thinking about all aspects of the business differently — industry dynamics, business models, operating models, competitors, and talent — and making consequential decisions despite significant uncertainty. It will require leaders to be brave enough to make clear decisions — often without the safety net of definitive answers — to take their enterprises in new, un-plotted directions.