Embracing the Future: Generative AI Reinforces a New Role for IT

I've attended three technology industry conferences over the past six weeks, and Generative AI (GenAI) dominated the agenda at each event. New solutions are hitting the market almost daily. IT service providers are pivoting to showcase their GenAI expertise, while major software companies have already integrated large language model (LLM) capabilities into their core products. It's starting to feel like there is an GenAI solution for everything.

Naturally, I am reminded of previous technological advances. However, this rate of GenAI adoption is unprecedented. ChatGPT reached 100 million users in just two months, a feat it took Facebook four years and Gmail five years to achieve. A few months later, ChatGPT has nearly doubled its user base with its web site garnering more than 1.5 billion hits per month.

But that’s only one side of the story. The other side is unfolding where most of us live: in enterprise IT. Having been involved in this GenAI frenzy with several clients, I see the primary challenges business and IT leaders face as they navigate this era of rapid technology adoption. But I also recognize the dual opportunities that this period presents to IT leaders: to ground these new initiatives in the fundamentals of business problem-solving and to use them as a proving ground for a new type of CIO role.

Back to Basics: It's Still About the Business Outcomes

On the enterprise side, companies have responding swiftly to the arrival of GenAI capabilities, first by implementing GenAI policies. It became apparent fairly quickly, though, that developing and enforcing these policies will be a significant challenge.

IT and cyber leaders have justifiable questions about data governance and data privacy —namely how they can protect company and customer assets as they move forward with GenAI adoption. Consequently, many companies are reevaluating their approaches to data governance and ownership, as a starting point for data protection. The upside is that large-scale GenAI adoption may yield a long-overdue modernization of existing data policies and procedures. And, thankfully, cybersecurity providers are heeding the call. Netskope, for example, developed a platform that can detect how data is being used and by whom, whether it is sensitive or not, and whether it can be leveraged in either private or public LLM solutions. (A real-time coaching capability even warns employees about the nature and disposition of the data they are using with LLM tools.)

In the meantime, companies have been eagerly investing in LLM initiatives, putting significant resources and manpower behind these efforts. As management expectations soar and the hype around generative AI intensifies, business leaders are quick to adopt plans that incorporate new LLM capabilities.

As I work with clients swept up in the excitement, I constantly remind business leaders of the importance of staying grounded in fundamentals. It’s essential that they evaluate the business outcomes of generative AI investments, just as they would with any other investment. Key considerations should include whether the investment will enhance customer engagement, generate new revenue streams, or reduce operating costs. Diving headlong into GenAI initiatives without weighing these factors can lead to not only wasteful spending but also missed opportunities.

It's certainly possible to move quickly in the GenAI space, but it should be done deliberately and dispassionately, with business outcomes as the focus. Experienced IT leaders know this better than perhaps anyone and can take the lead in balancing rapid adoption with the need to build a real business case for enterprise GenAI.

The Rise of Distributed Decision Models

The other issue for IT leaders is that GenAI adoption is being driven largely by business users —perhaps more so than any new technology capabilities to date. Enterprise technology has been moving steadily in this direction for some time. The rise of digital natives and the maturity of cloud services have transformed how and where business technology decisions are made, which is redefining the role of IT in enterprises.

Technology spending outside of IT is increasing, and distributed decision models are enabling business units to procure their own solutions. It’s never been easier for a business unit leader to purchase a cloud service — or experiment with a new GenAI solution.

But just because they can doesn’t mean they should. Many of these leaders fail to understand and accept the responsibility that comes with this power. They become the owners of these platforms and, as such, they need to understand how to manage compliance, privacy, risk, and cybersecurity requirements for these solutions. I am working with clients to formalize an approach that incorporates guardrails around the issues mentioned above. (As I’ve written about before, business leaders who go outside the technology organization to adopt technology solutions could learn a thing or two from their IT counterparts.)

Gen AI as Test Case for the Next Gen CIO Role

There’s much more that needs to be one before companies are mature enough to confidently adopt distributed decision models for technology procurement. But there is also an opportunity for CIOs to take on a new role, particularly now as generative AI and LLM technologies flood the market.

Sure, cloud technology and digital natives have revolutionized how the business engages with IT departments. But they can also transform how CIOs engage with the business. Gone are the days of the dominant design-build-run model of IT. Market forces have dismantled traditional business silos, making way for cross-functional teams united by a common mission. And it’s become evident that such teams, when they understand the holistic impact of operations on customer engagement, consistently outperform their less integrated counterparts.

In this interconnected business environment, there’s a demand for a new kind of CIO, as I laid out in a recent Heller Report article. This people-powered framework, in which the primary role of IT leaders is to Collaborate-Integrate-Orchestrate (C-I-O), takes on added relevance in the GenAI era.

• Collaborate: IT leaders should prioritize a deep understanding of customer needs and synchronize with the company’s strategic goals. They must stay abreast of the rapidly evolving GenAI landscape and identify those GenAI solutions that align with both company and customer objectives. This includes fostering cross-functional teamwork to leverage GenAI for innovative solutions and enhanced customer experiences.
• Integrate: IT leaders should focus on seamlessly integrating GenAI solutions into the existing technological infrastructure. This involves ensuring that user and customer experiences are cohesive and that GenAI tools enhance rather than disrupt these experiences. IT leaders should also prioritize extracting and utilizing valuable insights from GenAI solutions, creating a synergistic ecosystem that supports business goals.
• Orchestrate: IT leaders must ensure that new GenAI solutions are implemented effectively, operate smoothly, and are maintained securely. They should also be responsible for quantifying the expected business value of each GenAI initiative and measuring the actual outcomes against these expectations. This includes overseeing the security and compliance aspects of GenAI solutions, ensuring that they align with company policies and protect both company and customer data.

This C-I-O framework is designed to integrate technological initiatives with customer needs and business strategies, providing a comprehensive approach to modern IT management. And it gives IT leaders some guiding principles as they help their businesses navigate the frenetic GenAI marketplace.

A Promising Future

Although things are moving rapidly, we’re really only in the nascent stages of GenAI and LLM development. I’m certain that we will observe some profound impacts — both positive and negative — of this groundbreaking technology in the months and years ahead. Along the way, IT and business leaders should keep a few things top of mind.

Maintaining solid business discipline is crucial as companies embark on their GenAI journeys. It's important to move swiftly, but it’s even more essential to understand how the investment will influence business outcomes and benefit customers.

As the marketplace expands and an array of solutions continue to emerge, it's imperative to ensure that company policies and procedures keep pace. This is particularly important when it comes to safeguarding customer data and company assets.

Finally, leaders should pay close attention to the effects these developments have on their people. After all, adopting and supporting a collaborative and team-oriented approach will key to leveraging the power of these new technology capabilities effectively.