“You need to embrace Gen AI now to develop the muscle. The muscle will change over time. But it’s important to embrace it now. And make sure you have someone who’s responsible for it, at the top of the organization—don’t delegate it down. And then ensure that risk protection is embedded in your risk processes, but also your core processes, like product development, so that it really becomes a cultural element.”

— Sharon Marcil, managing director North America, BCG

“We’ve moved from a strategy supported by technology to a technology-driven strategy that requires a different kind of expertise….You need creativity, people who can think beyond the usual….So for us, it’s more about building the internal capabilities that we can’t get from the outside, and then making sure we have the right partnerships with the people who are outside, who can bring us their best thinking.”

— Tom Wilson, CEO, Allstate

“What happens if I knowingly or unknowingly infringe somebody’s IP?…The bulk of that concern today is coming from clients is in the area of code. Let’s take a maybe not-so-random example. If you are somebody in the payments industry, and you are going to use this for your deep developers to go write something, which is then going to be in place for 20 years, that means in year 15 somebody could come around and say, ‘Wait a moment. Those 10 lines look remarkably similar to what I did.’”

— Arvind Krishna, CEO, IBM

“I think about two ends of the spectrum. There is risk mitigation…making sure we have the guard rails to protect data. Then the question is, how do we refine it? And then, how do we innovate? We are working our way there with lots of experiments”

— Kim Keck, CEO, Blue Cross Blue Shield Association

“I think there is a bit of an overestimation of how fast and how big the immediate savings can be from Generative AI. I think it can be meaningful. But it takes time and a bit more work and expertise to get beyond the very first low-hanging fruits.”

— Barak Eilam, CEO, NICE

“Technology discontinuities in the past with enterprise software…really empowered developers to create great applications. With Generative AI, we are humanizing the technology, and handing over agency to the end user. It’s not developers being more productive. It’s users being more productive…That means you can create upward social mobility in jobs.”

— Ravi Kumar, CEO, Cognizant

If you are eager to dive further into these issues, I’d recommend a study that the folks at BCG published last week, which provides some interesting insight into where Gen AI improves productivity—creative ideation and content creation—and where it doesn’t—business problem solving. In the BCG study, participants using OpenAI’s GPT-4 for solving business problems actually performed 23% worse than those doing the task without GPT-4. Read more here.

Other news below. And read why the folks at Microsoft believe their Gen AI-powered “copilots” will help people navigate a hybrid workplace.

Alan Murray
@alansmurray
alan.murray@fortune.com

TOP NEWS

Writers strike ends

Hollywood writers, studios, and streamers reached a tentative agreement late Sunday that will likely end one of two months-long labor strikes. The three-year deal, the terms of which are not yet public, reportedly includes key concessions for workers, like increased royalties and protections related to the use of AI. The Wall Street Journal 

Lego’s sustainability setback

Lego has for years vowed to develop a brick that’s free of oil-based plastic. Now, the world’s largest toymaker is backtracking on that goal after realizing that the alternative brick, made of recycled plastic, resulted in more emissions. Instead, Lego will aim to make every component of its existing bricks more sustainable. Financial Times 

The 100-year-old CEO

Rupert Murdoch, 92, has retired, but there’s a big pool of CEOs in their 70s, 80s, and even 90s who have vowed to keep working deeper into their golden years. Longer life expectancy and later retirement ages demand that the corporate world come to grips with the prospect of a 100-year-old CEO, reports Fortune’s Lila MacLellan. Fortune

AROUND THE WATERCOOLER

Bill Gates gets real about climate change: Planting trees is ‘complete nonsense’ but the end of the oil and gas era is finally in sight by Paolo Confino

JPMorgan’s energy guru warns oil prices are headed to $100 per barrel. ‘Put your seatbelts on, it’s going to be a very volatile supercycle’ by Will Daniel

Gen Z is souring on college degrees as a path to success, sociology professor says. They have a good reason: Skills-based hiring is the way of the future by Jane Thier

Bill Ackman has employees in the office five days a week but makes an intriguing remote work concession by Steve Mollman

It’s not just you. From record canceled flights to $1,300 car rentals, summer travel this year was a nightmare by Alicia Adamczyk

Commentary: I left OpenAI to support the AI revolution. Here’s why real change won’t come from the epicenter by Zack Kass

This edition of CEO Daily was curated by Claire Zillman.