Good morning. CFOs and CEOs are strategic partners and in many companies they are working more closely than ever before. Therefore, it is essential for financial leaders to understand the CEO's perspective on emerging technologies to optimize their decision making.
The recent online Yale CEO Summit brought together CEOs from Fortune 500 companies to discuss how they are reinventing their businesses around AI, clean energy, and other emerging technologies. In a new opinion piece in Fortune magazine, Jeffrey Sonnenfeld, professor and founder of the Yale Institute for Chief Executive Leadership Studies, and Steven Tian, the institute's director of research, shared the perspectives of leading chief executives.
“Remarkably, the insights shared by 200 top CEOs suggest that some of the most innovative uses of AI are evident in some of the world's largest companies,” Sonnenfeld and Tian write. “These experienced non-tech giants embody Louis Pasteur's wisdom about innovation in the field of practice: 'Chance favors the prepared mind.'”
Chipotle CEO Brian Niccol, for example, is focused on using automation and AI to solve employee pain points during prep tasks like frying chips and preparing avocados. The fast-casual chain's robot, “Chippy,” makes tortilla chips, for example. Niccol sees these robots as a complement to humans, not a replacement. “One of our biggest challenges is getting prep done on time to open every day, especially if someone's not there in the morning and our team is short-staffed,” Niccol told the group.
Nicol knows exactly what he's talking about: “Wrapping a burrito is an art,” he told Fortune magazine in a recent interview. His experience behind the counter has given him a deeper appreciation for the team members who prepare and serve the meals, which has helped the company grow to more than 3,300 locations in 48 states and reach $2.7 billion in first-quarter revenue.
The financial services industry was also represented at the Yale CEO Summit, with Bank of America CEO Brian Moynihan speaking about the bank's own “Erica,” a voice-activated banking assistant that has had more than 2 billion customer interactions to date.
“First, we had to build a language that banking would accept, and then we had to build a structure that would work in the controlled, regulated environment of financial services,” Moynihan told the group. “Then we had to figure out how to deliver the product to 60 million customers, keeping in mind that those 60 million customers would have specific questions related to a transaction in one of their 60 million accounts, as part of 110 different systems and transaction types.” This is no small feat.
For more fresh perspectives on technology from top CEOs, including General Motors' Mary Barra and her thoughts on electric vehicles, read the full report here.
Cheryl Estrada
cheryl.estrada@fortune.com
Leader board
Mark Harris, chief financial officer (CFO) of global leadership advisory firm Heidrick & Struggles International, Inc. (Nasdaq: HSII), has chosen to leave the company to pursue other opportunities. Harris, who assumed the role in 2018, will remain with the firm through August. Heidrick & Struggles has formally launched a search for a new chief financial officer (CFO).
Thomas DeByle has been appointed CFO of data visualization technology provider AstroNova, Inc. (Nasdaq: ALOT). Mr. DeByle succeeds David S. Smith, who has retired. Mr. DeByle has over 25 years of experience and has served as CFO for public companies NN, Inc. and Standex International Corporation, privately held Plastic Industries, Inc., as well as senior finance roles at Doosan Infracore, Ingersoll Rand, Thermo King International, Enerpac and Johnson Controls.
Big Deal
While wealthy individuals believe U.S. stocks offer the best opportunity to grow their wealth, this sentiment is less strong among younger investors, according to the Bank of America Private Bank's 2024 Affluent Americans Survey. Wealthy millennials and Gen Z are driving demand for alternative investment strategies, from real estate and private equity to areas such as digital assets and gold.
For example, 72% of investors aged 21-43 believe it is no longer possible to earn above-average investment returns by investing exclusively in traditional stocks and bonds, while only 28% of investors aged 44 and over hold the same view.
“We are living through a period of enormous social, economic and technological change, alongside the largest intergenerational wealth transfer in history,” Katie Knox, president of Bank of America Private Banking, said in a statement.
BofA also cited three key trends from the report: The findings are based on survey responses from 1,007 Americans age 21 and older with more than $3 million in investable assets.
From the 2024 Bank of America High Net Worth Private Banking Survey report. Courtesy of Bank of America
Going deeper
According to the 2024 Association of Financial Professionals (AFP) Liquidity Survey, almost half (45%) of organisations moved their deposits to larger banks to seek safety at systemically important financial institutions, while 35% spread their deposits across more banks.
Additionally, 44% of finance professionals surveyed reported that their company's cash holdings in the U.S. have increased over the past 12 months (through March 2024), up from 36% in 2023. Additionally, 31% of respondents expect their company's current cash and short-term investment holdings to increase by the third quarter, according to AFP.
The findings are based on a survey of 239 finance professionals across a range of company sizes and industries.
Stories I've heard
“We are head-on in pursuit of secure superintelligence, with one focus, one goal and one product. We will achieve it through revolutionary breakthroughs.”
—OpenAI co-founder and former chief scientist Ilya Sutskever said Wednesday at X that he is starting a new company called Safe Superintelligence that will focus on creating safe AI environments. Subscribe to the Fortune Next to Lead newsletter to get weekly strategies for ascending to executive office. Sign up for free before launch on June 24, 2024.
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