The CFO Ascendant: Leading the AI Transformation
Artificial intelligence (AI) is no longer a futuristic concept; it’s fundamentally reshaping how businesses operate. For Chief Financial Officers (CFOs), this presents a dual opportunity: to harness AI’s power for unprecedented business value while ensuring ethical governance, financial discipline, and strategic alignment. Monica Proothi, a leading voice on Generative AI at IBM Consulting, is guiding finance leaders through this transformation.
I recently spoke with Proothi about the evolving role of CFOs in the rapidly changing AI landscape. Our conversation explored the greatest hurdles to maximizing AI’s return on investment (ROI), the critical importance of responsible AI implementation, and how CFOs can leverage AI to augment, not replace, human expertise.
Overcoming Challenges in AI Adoption: Workforce, Culture, and Governance
According to Proothi, the key to AI success lies in the people. She emphasized that integrating AI seamlessly into daily workflows is essential. “AI stickiness is key,” she stated. “It’s not just about deploying the technology; it’s about making it user-friendly, integrating it into how people work, and ensuring it’s trustworthy.”
Proothi highlighted the crucial role of governance. “What a company can achieve with AI is significantly determined by how it selects, governs, and applies data across the enterprise,” she explained. “CFOs need to integrate data governance into every phase of AI development to guarantee systems are both effective and ethical, and transparent.”
Balancing Ethics and Governance for Trusted AI
Trust is paramount, meaning many CFOs are more concerned about the ethics of AI rather than its governance. Proothi stresses the importance of bias-free data and robust governance frameworks.
“AI is only as effective as the data it learns from,” Proothi noted. “To ensure reliable insights, organizations must prioritize data governance, transparency, and accountability. Strong governance prevents bias, fosters trust, and ensures AI is deployed responsibly.”
AI’s Role in Fostering CFO-CEO Collaboration
AI is redefining leadership dynamics, facilitating stronger collaboration between CFOs, CEOs, and the entire C-suite. “Leaders face a multitude of responsibilities daily, potentially leading to a loss of human connection,” Proothi explained. “AI can automate routine tasks, freeing teams to focus on strategic thinking and cross-functional cooperation.”
Financial reporting is one area where AI is already making significant strides. Instead of dedicating extensive hours to compiling data from diverse sources, CFOs can employ generative AI to analyze trends and generate reports. This allows them to dedicate more time to working alongside the CEO and other business leaders to translate insights into actionable strategies.
IBM’s Approach: AI-Driven Forecasting
IBM has successfully implemented AI to transform financial forecasting, a historically manual and time-intensive process. Proothi said, “The key to making AI work is organizing and standardizing data across the company. At IBM, we’ve established strong data governance, which has allowed us to implement touchless forecasting with 97% accuracy. The result is faster, more precise financial insights that support smarter decision-making.”
Proothi believes that by automating routine tasks, AI can actually enhance human connections for CFOs as they build relationships with the CEO and across the C-Suite.
Investing in AI: Balancing Short- and Long-Term Value
Proothi recommends a balanced approach to AI investments, allocating resources across short-, medium-, and long-term horizons. “AI isn’t simply about quick wins; it’s about building for lasting success,” she emphasized. “This is why it’s crucial for CFOs to get involved early in IT planning, work with cross-functional teams, and align technology investments to measurable business outcomes.”
Rather than viewing AI as merely a cost-cutting tool, Proothi highlights it as an enabler of both efficiency and growth. “CFOs should see AI as a catalyst for long-term innovation—through repeatable and scalable assets—rather than just a means to reduce expenses.”
Reskilling and the Future of Finance Talent
As AI automates traditional finance and accounting tasks, reskilling teams becomes a priority for CFOs. “The finance function is evolving from transaction processing to strategic advisory,” Proothi said. “CFOs need teams that possess a technology-forward mindset, combining financial expertise with data science and AI literacy.”
IBM has embraced this shift by upskilling finance professionals, providing training in AI, and embedding data scientists within finance teams.
Winning the War for Talent
In today’s competitive talent market, CFOs must position their organizations as AI-driven and digitally savvy to attract top talent, particularly from younger generations. Proothi stated, “The war for talent isn’t going away anytime soon. To stand out, companies need a clear AI strategy and a culture of digital innovation. Younger professionals want to work for organizations that embrace new technologies and offer career paths that evolve alongside AI advancements.”
While “unicorn” candidates—those excelling in finance, accounting, and technology—are rare, organizations can build high-performing teams by diversifying skill sets across finance, tech, and data analytics.
Cybersecurity and Data Privacy: Addressing Reluctance to Adopt AI
Despite the potential benefits of AI, concerns about cybersecurity and data privacy remain a significant hurdle for CFOs, who recognize that a single cyber breach could negate all AI’s advantages.
A recent IBM study showed that 60% of CFOs and CROs consider their approach to AI risk management to be either ad hoc or nonexistent. Organizations must treat data governance and cybersecurity as fundamental business imperatives to mitigate these risks.
Proothi said, “Companies that manage data effectively and establish trusted governance realize nearly double the ROI from AI investments compared to those that don’t.”
Navigating Economic Uncertainty with AI
Economic uncertainty requires companies to strike a balance between cost efficiency and innovation. Proothi explained, “AI isn’t just a tool for reducing expenses—it can also drive growth. By automating repetitive tasks, companies can reinvest the savings into innovation and position themselves for long-term success.”
A CFO’s Action Plan: Where to Start
For CFOs considering the first steps, Proothi offers three key recommendations:
- Take Bold Action: Leverage AI for high-impact areas like FP&A, forecasting, and cash flow optimization.
- Champion AI Adoption: Cultivate a culture of innovation and encourage teams to embrace AI as a strategic partner.
- Focus on Governance and Trust: Establish strong data governance and cybersecurity measures to ensure ethical and effective AI adoption.
As AI continues to redefine business, CFOs have a unique opportunity to spearhead digital transformation and shape the future of financial strategy. Those who take the initiative now will be best positioned to drive value, growth, and long-term success.
