Why generative AI is an extraordinary new power source
Cliff Justice is the KPMG U.S. Leader of Enterprise Innovation. He and his group focus on identifying, developing, and deploying the next generation of technologies and solutions for KPMG and its clients. Here he explores what the C-suite should know about generative artificial intelligence (AI)—its impact on business and our lives.
Something unexpected happened recently when I asked GPT-4 about a topic that I’ve been reading about. The chatbot lectured me—and then apologized. It was a surreal human-machine interaction that wasn’t possible just a few months ago. The moment signaled to me that generative AI is here to stay. And it’s evolving fast.
Gen AI is the opportunity—and the imperative—of our lifetime.
Generative AI creates its own content rather than responding to or analyzing existing content. This net-new content can be mind-blowing—like the AI-generated video of Bill Gates and Socrates debating the pros and cons of AI. This technology will transform every part of our lives, including what we believe to be true and the heuristics of how we think. Generative AI isn’t only a technological turning point. It’s a cultural flashpoint.
Most executives know just how transformative generative AI will be, according to a recent KPMG survey of U.S. executives. Sixty-five percent think the technology will have a high or extremely high impact on their firm in the next 3 to 5 years. And 60 percent say their company is 1 to 2 years away from implementing its first generative AI solution. Yet many executives haven’t fully grasped what generative AI is exactly, that it’s profoundly different than a bot scraping the internet1.
77%
of executives think that generative AI will have a bigger impact on broader society than any other emerging technology in the next 3 to 5 years.
I believe that generative AI is the greatest technological disruption of our lifetimes. It is our wheel. Our steam engine. Our light bulb. It’s advancing so fast that GPT-4’s jaw-dropping capability will seem primitive in months, not years. And this mega disruption is happening amid great geopolitical volatility.
It’s never been more important for the C-suite to manage change well, and many leaders haven’t had to do it at such speed, scale, or with such consequence. But I encourage leaders to be bold. Audacious even. It’s essential to finding the most impactful way to use AI. That’s why it’s time to ask a critical question: How do we use generative AI now that we have it?
Today’s generative AI technology builds on decades of natural language processing and machine learning research and innovation. But history will look back on November 2022 as a milestone moment in the story2. It’s when OpenAI put a natural language processing chatbot into the hands of anyone with internet connectivity.
The pace of adoption was unprecedented. ChatGPT had 1 million users 5 days after its launch. It took Instagram 5 months, Facebook 10 months, Twitter 2 years, and Netflix 3.5 years to reach this threshold3. The irony? ChatGPT couldn’t report on its own incredible feat. The model’s knowledge cut off in September 2021.
The generative AI arms race among big tech companies and a sea of smaller disruptors has since gone into overdrive. Generative AI is the talk of popular media and tech luminaries. Bill Gates called it “the most important technology since the graphical user interface.”4 Google’s CEO Sundar Pichai told 60 Minutes that it “is more profound than the invention of fire or electricity.” At the same time, the “godfather of AI” Geoffrey Hinton left Google concerned that about the consequences of letting Pandora out of the box5.
The C-suite wants clarity amid contradictions like these. They want to know if they’re watching yet another hype cycle that will fizzle out, or something profoundly different. They want to understand the existential impact that generative AI could have on their business. And they want insights into what it means for their existing technology and talent investments. Yet there aren’t definitive answers.
Think of generative AI as a new power source. It’s intellectual electricity that will change how we analyze information and develop insights from data. Like any power source, the value isn’t in the power itself. It’s in how it’s applied.
Like new power sources fueled the industrial revolutions, generative AI will fuel an intelligence revolution. One with exponential impact. But there’s a catch. Physicist Albert Bartlett argues that “Humans’ greatest shortcoming is the inability to understand the exponential function.” If you believe Bartlett, living through exponential change as we are today is essentially living through change that our brains can’t comprehend.
Generative AI is pushing leaders to look at all aspects of their business differently—industry dynamics, business models, operating models, competitors, and talent. It’s forcing them to make consequential decisions despite significant uncertainty. There’s one thing that the C-suite can be certain of: generative AI’s extraordinary power comes from what humans bring to it, from human-machine collaboration. And the promise is in how generative AI will augment the workforce.
96%
of executives are getting their information about generative AI from either social media or news articles and press releases.
Generative AI raises complex questions about trust, ethics, and machine consciousness just to name a few. Like other emerging technologies, it comes with challenges, but it can also propel solutions forward in so many areas—healthcare, education, human productivity, and more. Just imagine the impact when we can combine it with quantum computing.
At KPMG we’re prioritizing trusted AI as we accelerate AI-powered solutions across our firm and for our clients. One of the ways that we’re addressing this is through Cranium, the first spin-out from KPMG Studio. It’s helping clients manage the unique nature of AI security threats in real time.
While people’s expectations for this technology may ultimately exceed reality, generative AI is a big part of a world that’s changing fast. Right before our eyes. I encourage leaders to start experimenting with it. Do what I did. Get curious. Ask questions. Engage. You might not get an apology, but I suspect that you’ll end up agreeing with me that generative AI is here to stay.
A similar version of this first appeared in MLR Media.
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