Meet our experts: Pär Edin
Pär’s career began at the European Space Agency, working on using space technology to mitigate natural disasters and developing civil applications of drones for Broadband satellite communications. He holds master’s degrees in electrical engineering, Telecommunications, Computer Sciences, and Space Applications from the Royal Institute of Technology in Stockholm. With over 30 years of experience in Artificial Intelligence, Pär is passionate about leveraging technology to boost human productivity and creativity in business, catering to both corporate and private equity clients. He collaborates with C-suite executives to shape strategies and implement strategic initiatives that accelerate growth, improve operations, and build essential capabilities. Since the launch of Chat-GPT 4, he has led the KPMG GenAI Rapid Response team, supporting over 1,000 client engagements across various sectors and functions. He frequently collaborates with boards, C-suite leaders, and investors, sharing insights on GenAI, AI, and advanced analytics.
The 2023 KPMG Global Tech Survey (KPMG, 2024a) reveals that three out of five respondents believe AI, including machine learning and Generative AI, will be crucial for achieving their business goals over the next three years. In the financial services sector, KPMG aims to connect technology, business, and specific problem-solving needs. They approach technology costs and investments in three categories: maintaining outdated systems, upgrading technology and related cultural changes, and ensuring future adaptability without increasing technical debt.
In our chat on the use of AI in business, Pär Edin referred us to two recent KPMG AI publications. One article focusses on AI and GenAI in the financial sector and the second focusses on how businesses can create value out of GenAI, while paying attention . He highlighted his insights from these two articles which is summarized below.
Prioritizing the timing, location, and scale of investment in AI transformation for 2024 is a complex task. One significant challenge highlighted by Pär Edin (KPMG, 2024a) is the ‘last mile challenge of AI.’ This issue is often overlooked. Pär explains, ” “Even if AI can help knowledge workers free up a third of their time in studies and pilots, this only translates into real productivity gains if all knowledge workers adopt the tools and re-invest hours saved into something more productive — for example, taking on more volume or higher value-add tasks.”.
Pär further emphasizes, ” “These are major behavioral changes that cannot be ignored if PE firms are to deliver the productivity gains that AI promises. Success will require a carefully crafted transformation program with a portfolio of actions that hit all behavioral change barriers simultaneously. Solving this, at scale, may be the biggest value creation challenge genAI will face, and not a muscle well trained in prior technology-driven disruptions.”
Finally, the rapid adoption of AI heightens risks such as data privacy breaches, more sophisticated cyberattacks, and legal issues stemming from inherent biases in AI models.
To mitigate these risks, it’s crucial to implement a human-in-the-loop approach for many applications, establish ‘Trusted AI’ governance frameworks, and use third-party software solutions. A recent initiative by KPMG, Cranium, exemplifies this approach. Cranium is a software platform developed in the US to provide technology solutions that help organizations safely adopt and deploy AI models.
In the second article, the KPMG report (KPMG, 2024b) on board oversight of Generative AI (GenAI) highlights several critical issues and offers guidance for boards to navigate this emerging technology (KPMG, 2024b). As GenAI moves from experimentation to broad company-wide adoption, it presents both significant opportunities and challenges. The discussion centers around strategic importance of GenAI, behavioral and organizational challenges, evolving risks and governance needs and the role of the board and leadership. The report suggests the importance of careful oversight and strategic planning by boards and management teams.