The integration of Artificial Intelligence (AI) into corporate strategy has become a pivotal focus for organizations aiming to maintain a competitive advantage in the digital age. As AI reshapes business operations and drives innovation, the need for specialized leadership to effectively manage these changes becomes increasingly apparent. In this paper, I explore the role of the Chief AI Officer (CAIO) within the C-suite, emphasizing the necessity of this position for successful AI strategy, integration, and governance. I analyze future scenarios based on current trends in three key areas: the AI Economy, AI Organization, and Competition in the Age of AI. These explorations lay the foundation for identifying the antecedents (environmental, structural, and strategic factors) that justify the inclusion of a CAIO in top management teams. This sets the stage for a comprehensive examination of the CAIO's role and the broader implications of AI leadership. This paper advances the discussion on AI leadership by providing a rationale for the strategic integration of AI at the executive level and examining the role of the Chief AI Officer within organizations.

When Bradford Newman began advocating for more artificial intelligence expertise in the C-suite in 2015, "people were laughing at me," he said. Newman, who leads global law firm Baker McKenzie's machine learning and AI practice in its Palo Alto office, added that when he mentioned the need for companies to appoint a chief AI officer, people typically responded, "What's that?" But as the use of artificial intelligence proliferates across the enterprise, and as issues around AI ethics, bias, risk, regulation and legislation currently swirl throughout the business landscape, the importance of appointing a chief AI officer is clearer than ever, he said. This recognition led to a new Baker McKenzie report, released in March, called "Risky Business: Identifying Blind Spots in Corporate Oversight of Artificial Intelligence." The report surveyed 500 US-based, C-level executives who self-identified as part of the decision-making team responsible for their organization's adoption, use and management of AI-enabled tools. In a press release upon the survey's release, Newman said: "Given the increase in state legislation and regulatory enforcement, companies need to step up their game when it comes to AI oversight and governance to ensure their AI is ethical and protect themselves from liability by managing their exposure to risk accordingly."

Companies in the US may be bullish on using artificial intelligence (AI), but many executives are ambivalent about its associated risks – especially when it comes to AI-enabled hiring and people management tools. According to a new survey by the global law firm Baker McKenzie, though 100 percent of senior executives agree there are risks associated with using AI, just 4 percent of respondents consider these risks to be "significant." Three fourths of those surveyed indicate their organization uses AI for key human resources (HR) management and employment functions – for example, recruiting and hiring, performance and promotion, and analyzing employee attendance or productivity trends. The Baker McKenzie survey, Risky Business: Identifying Blind Spots in Corporate Oversight of Artificial Intelligence queried 500 US based C-level executives who self-identified as part of the decision-making team responsible for their organization's adoption, use and management of AI-enabled tools. The telephone- and email-based survey was conducted during the months of December 2021 and January 2022, with executives at companies with at least $10.3 billion in annual revenues on average, across a range of industries.

Assign a chief AI ethics officer (CAIO) who along with a cross-functional ethics board (including representatives from data science, regulatory, public relations, communications and HR) should be responsible for the designing and implementing AI education activities. The CAIO should also be the "ombudsman" for staff to reach out to in case of fairness concerns, as well as a spokesperson to non-technical staff. Ideally this role should report directly to the CEO for visibility and implementation.

Consider this--only about 50 companies, or roughly 10%, have remained on the Fortune 500 list since 1955. As we start moving into the early 2020s, we're on the cusp of another major change, one that will be guided by artificial intelligence (AI). As revenues rise and fall, and companies adjust to new economic, political and social landscapes, the internal workings of companies change as well--specifically, executive roles, processes and technology. For the first article in my three-part series, I'll walk you through how, guided by AI, executive roles within companies will change in the 2020s. Companies have long assigned new responsibilities to some executive roles, and have carved out new executive roles, too.

The acceleration of artificial intelligence adoption in the enterprise space has created the chief artificial intelligence officer¹ position to handle increasing roles. Companies see the chief technology officer as the person responsible for all technology solutions, but the reality is that AI deployment² commands time and requires a dedicated leader to coordinate with the C-suite. AI and its impact on enterprises dictates that artificial intelligence is an essential component of strategy that every business needs. The focus for those leading AI is to help organizations utilize these systems for enhancing existing business operations and AI powered³ products. This is where the chief AI officer steps in.

Companies using artificial intelligence (AI) across their business units should consider creating a C-suite position to oversee how AI is used and guard against the risk of making bad decisions based on biased algorithms, experts say. Only a few companies, like Levi Strauss & Co, have established a chief artificial intelligence officer (CAIO) position, and fewer have created a C-level position dedicated solely to AI ethics. Brian Kropp, chief of research in the HR practice at Gartner, said chief technology officers and chief information officers will struggle with handling AI-related decisions and ethical dilemmas. "CTOs and CIOs are going to be thinking about the role through the lens of how they can make the technology work," Kropp said. However, "artificial intelligence is not a question of how you get the technology to work; it's a question of how do you think through the implications of the technology?"

For many companies, Artificial Intelligence (AI) and the range of cognitive technologies are strategic to their businesses and organizations. Indeed, for these organizations, AI is as fundamentally important to their long-term well being as their IT operations and finances. In recent decades, we've added to the so-called "C-suite" with strategic top-level management positions such as the Chief Information Officer (CIO), Chief Information Security Officer (CISO), and even more recently the Chief Data Officer (CDO). One might think that with AI's strategic role for organizations, that if you have a CIO in charge of all the information and IT-operation activities in the organization and a Chief Financial Officer (CFO) in charge of all the finances for the business, why shouldn't you have a Chief AI Officer (CAIO) in charge of all the AI-related activities? This might make sense for some companies but most likely, it doesn't.

But, 58% of businesses say that less than 10% of their company's digital budget goes towards AI. So, it's not surprising that only 15% of AI projects succeed. This disconnect comes as no surprise to us. I was an analyst at Morgan Stanley and earned my technology stripes (and scars) at Apple under Steve Jobs, while my partner and wife, Helen, is a former CIO and corporate venture capitalist. We know the hallmarks of innovation window-dressing and transformation-by-outsourcing.

AI deployment in the corporate world is at a critical inflexion point, often stuck at the proof of concept (POC) stage. The need for translation between data science teams and business stakeholders means that corporates should consider appointing a Chief AI Officer (CAIO) to set strategy, support technology choices, and drive roll-out. As machine learning becomes business as usual, the ambition should be to make them redundant. But until you are there, a CAIO may be just the shock to the system that your business needs. The Chief Executive has attended the conference, her senior team have had the briefings.