Tech-savvy CEO

CEOs have strong views on the advantage AI and other technologies brings to business, balanced with the awareness of potential cyber and regulation risks.

While not digital natives, our CEOs have successfully embraced technology throughout their careers, and are increasingly focused on integrating advanced technologies to drive growth and innovation within their organisations. There is a clear understanding that the time is now to push forward with implementing Generative AI within businesses, while staying alert to cyber risks and trust and regulation challenges.

The race to embrace

Owen Lewis

Partner, Head of Management Consulting, Head of Banking & Capital Markets

KPMG in Ireland

Driving to adopt and embed Gen AI and other technologies is a high priority. Both ROI and NI respondents reported this was top of mind right now (67 percent for ROI, 63 percent for NI) in line with 64 percent globally. For those on this island, this dwarfed economic uncertainty (37 percent ROI, 43 percent NI), geopolitical complexities (23 percent ROI, 27 percent NI) and organisational growth prospects (27 percent ROI, 43 percent NI).

Reinforcing its importance, Gen AI ranks in the top three strategies for achieving growth objectives in the next three years, along with organic growth and M&A both in ROI and NI.

For Owen Lewis, Head of AI and Management Consulting, KPMG in Ireland, transitioning from the planning phase is essential for businesses to achieve tangible results. “There is a huge appetite to realise the benefits that Gen AI and indeed more conventional machine learning can deliver. The prize is there for those organisations that can set up their data and technology foundations, governance and processes, and customer propositions to realise the AI advantage.”

When it comes to the main benefits of implementing Gen AI across their business, ROI CEOs report faster data analysis and increased efficiency and productivity (through automating routine operations). In NI, the opportunities for new product and market growth are top of the AI benefits list. However, Lewis also notes, “It’s imperative for businesses to approach AI adoption with an open mind and a laser focus on value creation."

Deciding what’s best

Gillian Kelly

Partner, Head of Consulting

KPMG in Ireland

61 percent of CEOs globally report that ethical issues are the biggest challenge in implementing generative AI in their organisations, an increase from 57 percent from 2023. This figure rises among CEOs in both ROI and NI with 87 percent and 77 percent respectively reporting ethics concerns.

However, in ROI the lack of regulation is an even bigger AI issue for 90 percent of respondents. Meanwhile in NI, ethics and regulatory concerns are of equal importance. Yet optimism is strong among CEOs as only 13 percent in both ROI and NI believe the pace of progress on Gen AI regulation will be a barrier to their organisation’s success, compared with 69 percent globally.

93 percent of respondents in ROI and 70 percent in NI also believe the degree of regulation regarding Gen AI should mirror that for climate commitments. The global figure stands at 76 percent.

Gillian Kelly, Head of Consulting at KPMG in Ireland, believes we are well placed to benefit from the early adoption of AI opportunities. Kelly notes that significantly fewer Irish respondents cite regulation as a barrier to success, indicating an understanding of the role of the EU AI Act.

“The research displays CEOs who are clear on the importance of regulations, but not feeling held back by their necessity. Here in Ireland, the EU AI Act equips those businesses with the essential tools to address implementation challenges effectively. It’s now crucial for businesses to move beyond discussions and start implementing.”

Challenges of implementation

Perceived costs of implementing Gen AI was stated as a challenge for 77 percent of ROI respondents, lowering to 50 percent in NI. This figure falls to 46 percent globally.

The pace of developments is also a factor, for half of those in ROI (50 percent) and a third in NI (33 percent) saying taking time to implement changes may be difficult.

Although it may be somewhat daunting, Gillian Kelly highlights the immense opportunity for businesses if they engage with advancements in technology; “Navigating the world of emerging technologies is a rewarding experience, marked by constant innovation and the potential for substantial impact. Although challenges will always remain, these are far outweighed by opportunities.”

Time to upskill

When asked about the top operational priorities to achieve growth objectives in the next three years, CEOs in both ROI and NI named their top priority as understanding and implementing Gen AI across the business, including upskilling of workers, and streamlining processes. Specific investment in developing these skillsets was reported by 43 percent in ROI and 50 percent in NI, a figure higher than seen globally at 13 percent.

However, our research shows significant concern, particularly amongst those CEOs in ROI, in the ability of workers when facing this new era of Gen AI supported workstreams. Technical capability and skills required to implement Gen AI was reported as a challenge for 93 percent of CEOs in ROI, yet this drops to less than half (47percent) in NI. Globally this stands at 48 percent.

Acknowledging this challenge for CEOs, Gillian Kelly urged business leaders to move forward with adapting their workforces.

“It’s important to make sure your people have the correct skill set for this rapidly changing environment. Reskilling may be needed to help your teams get the most out of technology, and to make sure that where technology is used to replace some of the tasks they currently perform, they have the opportunity to re-focus on other valuable areas. The time is now to invest in your people.”

Cyber-attack ready

Dani Michaux

Partner, EMA Cyber Leader

KPMG in Ireland

Every business leader has seen the headlines. CEOs are acutely aware of the threat posed by cyber-attacks. Worryingly, 100 percent of those in ROI and 87 percent in NI state that cyber crime and insecurity will negatively impact their organisation’s prosperity in the next three years.

The latest KPMG Enterprise Barometer revealed that a majority (74 percent) of businesses in Ireland reported their company had never experienced a cyber security attack. Yet it is encouraging that organisations are not waiting until they have first-hand experience before putting protective measures in place.

In the face of a potential attack, 73 percent in ROI report feeling well-prepared, however, this falls to just over half in NI (53 percent). Globally this is also a sentiment shared with 48 percent reporting same.

For Dani Michaux, EMA Cyber Leader, KPMG in Ireland; “resilience will be critical as businesses adapt to digital transformation and AI advancements, which also may bring their own set of cybersecurity concerns.”

Our research also shows 70 percent of CEOs in ROI report confidence in their organisation’s cyber security ability to keep up with rapid AI advancements. Yet this falls to just 43 percent in NI. This is close to what we are seeing globally at 51 percent and brings into focus the need to continually prioritise cybersecurity measures. CEOs are all too aware of the importance of investing in robust frameworks to mitigate risks, especially as AI and other technologies advance at pace.

For Dani Michaux, although AI also has a part to play in this defence, the people factor must not be forgotten. “Part of the solution is to deploy AI to bolster cyber defences, but the human element of the equation remains critically important."

Michaux concludes, "Humans are the best line of defence. We are best placed to detect phishing emails and prevent ransomware attacks. Ultimately, the key to reducing risk is to bring human critical thinking and scepticism to bear. There is no substitute for keeping your people in the loop.”

Questions to consider

01

Have you considered the cost of a cyber breach? It’s almost certainly higher than the cost of prevention.

02

Do you foster a culture of digital curiosity and continuous learning across your teams?

03

Are you compartmentalising AI as a risk and compliance issue or really seeking out opportunity?

04

Are you personally at risk of getting left behind or are you using new tech to understand its potential?

Actions to consider

Trust is fundamental to the introduction of AI. And as the technology develops faster than related legislation worldwide, you must ensure your AI approach stands up to scrutiny.

Meanwhile as cyber-crime evolves, don’t underestimate the importance of people and culture in mitigating risk. And don’t leave leadership on cyber risk to someone else.