Unlocking the Power of AI: A CFO's Perspective

As the business world continues to evolve, the role of the Chief Financial Officer (CFO) has become increasingly crucial in navigating the complexities of emerging technologies, such as artificial intelligence (AI). In a candid conversation, veteran tech CFO Mark Hawkins shares his insights on the process of presenting and implementing AI strategies to the board, emphasizing the importance of clear communication, credible use cases, and a transparent approach to risk management.

Empowering CFOs to Lead the AI Revolution

Defining the Use Case: The Key to Credibility

Hawkins' first piece of advice to CFOs is to "clearly and unambiguously define the use case" when presenting an AI investment plan to the board. He explains that the less difficult it is to understand the proposed application of AI, the more credible the opportunity becomes. As a seasoned executive, Hawkins notes that when people struggle to explain the use case, it raises a "yellow flag" for him, indicating the need for further clarification and transparency.Hawkins' extensive experience, which includes roles as CFO at Salesforce, Autodesk, and Logitech, as well as various positions at Dell and Hewlett-Packard, has equipped him with a deep understanding of the challenges and opportunities that come with implementing emerging technologies. He emphasizes the importance of sharing the "math, the ROI, the metrics of success" with board members to build credibility, while also being transparent about any associated risks and working to establish trust.

Navigating the Governance Framework for AI

Hawkins also stresses the significance of articulating a clear governance framework for technology, particularly when presenting to a "super-sophisticated group of technologically advanced people" who may have deep engineering and scientific backgrounds. He suggests that CFOs should be prepared to provide additional details and context to ensure that the board members fully comprehend the proposed use cases and their alignment with the company's overarching goals and principles.

The Exponential Growth of AI Investments

The growing importance of AI is evident in the projected market trends. According to Gartner, spending on AI software is expected to reach 7.9 billion by 2027, with a compound annual growth rate of 19.1%. Furthermore, the research firm's findings indicate that boards are asking about AI more than three times as often as they do about considerations tied to cloud computing, underscoring the increasing prominence of this transformative technology.

Embracing AI as a Paradigm Shift

Hawkins draws an insightful parallel between AI and electricity, describing both as "big paradigms" that have the potential to significantly impact the way businesses operate. He views AI as a technology that can augment people's abilities and productivity, leading to significant value creation and the emergence of new business models that do not yet exist.

Reflecting on a Transformative Journey

Hawkins' own career path serves as a testament to the transformative power of technology. He recounts joining Hewlett-Packard (HP) at the age of 21, when the company had a revenue of .1 billion. In 2023, HP's annual revenue had grown to .7 billion, marking the beginning of Hawkins' journey into the technology industry, a journey that has spanned over four decades.As CFOs navigate the rapidly evolving landscape of AI, Hawkins' insights provide a valuable roadmap for effectively communicating and implementing AI strategies to the board. By clearly defining use cases, establishing robust governance frameworks, and embracing the transformative potential of this technology, CFOs can position their organizations for success in the AI-driven future.