Selecting The Right Partner For AI Governance – A CEO’s Guide

Hello and welcome to the latest edition of?AI Strategy Brief. In this edition we’ll review some recent industry developments in AI and consider what CEOs should look for when selecting a partner to develop their AI Governance System.

AI Industry Updates:

• Cybersecurity – DARPA Launches AI Competition
• Policy – Fiscal Note Launches Lobbying AI
• Global – Gulf States Bolster AI Initiatives With Strategic Acquisitions

Cybersecurity – DARPA Launches AI Competition

DARPA has initiated the?AI Cyber Challenge?(AIxCC) with the aim of pioneering a new era of AI-enhanced cybersecurity tools, designed to fortify the nation's software infrastructure. Spanning two years, the AIxCC is structured in two stages: the semi-finals in 2024 and the grand finals in 2025, both of which will take centre stage at DEF CON, Las Vegas. Contestants, ranging from individuals to large corporations, are tasked with crafting AI solutions capable of autonomously detecting and rectifying software vulnerabilities. These AI solutions should be versatile, working across a myriad of software types, including open-source, and scalable for extensive software systems.

A prize pool of $10 million awaits the challengers, with the champions winning $2 million. Runners-up are also rewarded with $1 million for the second spot, followed by $500,000 for third, and $250,000 each for fourth and fifth places. Registration is open until March 8, 2024. This challenge is an integral component of DARPA's AI Next Campaign—a dedicated multi-year endeavour to encourage AI research and innovation, targeting global challenges from cybersecurity to climate change and healthcare.

Policy – Fiscal Note Launches Lobbying AI

FiscalNote Holdings, Inc., an AI-driven software provider specialising in policy, has unveiled its new AI platform,?FiscalNoteGPT. The platform features standard LLM capabilities, fine-tuned for legislative, regulatory, and policy workflows. FiscalNoteGPT processes a client company’s proprietary intelligence using AI technology based on the models of OpenAI. The result is hoped to be a more tailored AI assistant designed to offer insight and recommendations to those working in the lobbying and public affairs space.?

Josh Resnik, President and COO of FiscalNote, emphasised the platform's uniqueness, citing a decade of the company's AI investment and its proprietary databases as distinct advantages. With FiscalNoteGPT, the company hopes to addresses the complexities inherent to the legal and regulatory sector by offering more tailored or out-of-the-box functionality to industry professionals. This platform is currently in a trial phase with select customers and is expected to see a broader release later this year. Interestingly, FiscalNoteGPT emerges as a domain-specific AI application, which could be the first of a new class of AI offerings we see more of in the coming years.

Global – Gulf States Bolster AI Initiatives With Strategic Acquisitions

In a move signalling their ambitions in the global AI space, Saudi Arabia and the UAE are intensifying their partnerships with Nvidia, one of the leading global manufacturers of GPUs. This week, the?Financial Times highlighted Saudi Arabia's acquisition of over 3,000 Nvidia H100 chips, which are specifically tailored for AI applications. At the same time, the UAE is increasing its Nvidia chip inventory and has plans to expand its state-of-the-art AI research hub.

The increasing interest in AI from the Gulf States is consistent with their past investments. Their growing portfolio of AI research centres indicates a determined strategy to develop a position as a global leader in AI. The Gulf States assert a commitment to harnessing AI for advancements in sectors like healthcare and transportation in particular. As the global race to become a leader in AI heats up, the ability of chip manufacturers to match pace with growing chip demand, looks increasingly difficult.

The Big Topic: Selecting The Right Partner For AI Governance – A CEO’s Guide

As more companies look to integrate AI into their operations, many are starting to develop AI Strategies and focus on AI Alignment. However, the biggest challenge a lot of leaders have at the moment relates to AI Governance, and in particular, convincing their Boards that they can develop and implement AI in a manner which is as safe as it is advantageous. To that end, a lot of CEOs and leaders are looking to the consulting industry and external advisors to help them develop and implement more robust AI Governance Systems that are transparent, manage the needs of explainability, and are regulation-ready. To help them make this choice, today I want to examine what CEOs and leaders should look for when selecting an external partner to aid in AI Governance. The following offers a brief outline or checklist leaders can use, when assessing potential AI Governance partners:

1. AI Experience

• Deep Technical Insight: Your ideal partner should possess more than a superficial understanding of AI. They need a rich background in AI technologies, appreciating not only how they work but the broader implications they carry. Look for partners that are familiar with a variety of AI programmes from a range of different suppliers, as well as the rigours of developing in-house AI.
• Track Record: History often predicts the future. Go for providers with a proven track record in AI, especially with knowledge on AI Governance. Their previous work will offer insights into their expertise and approach and ideally you should look for someone who has a demonstrable command of AI topics.?

2. Strategy Expertise

• Strategic Acumen: The partner's team should include professionals with experience designing and implementing strategies, ensuring AI seamlessly integrates with overarching corporate objectives. There is a strong distinction between someone who is familiar with an AI application, and one who understands how it will integrate with operations, corporate strategy and the evolving business model. If this area of expertise is lacking, the Governance System will likely be incomplete at best, and may even damage value creation and risk management at worst.?
• Alignment with Business Objectives: It's vital that your partner ensures AI initiatives resonate with your company's mission, vision, and long-term goals. When designing the AI Governance System, the overarching strategy of the company has to be taken into account. Given the fast-moving nature of AI technologies, and their tendency to permeate unexpected areas of organisational life, an AI Governance System needs to be tailored very closely to the organisation’s strategy and its long-term AI ambitions. This is very different to the traditional forms of Digital Governance we have seen over the past two decades, and the two should not be confused as the same.

3. A Systems Approach

• Holistic View: Effective governance transcends isolated policies. Your partner should champion the development of a holistic AI Governance Framework, integrating with your business's horizontal operations. If the AI Governance System is not able to connect to other organisational systems across the company’s value chain, it will not work in practice.?
• Integration with Existing Systems: At the same time, a potential partner should stress the importance of integrating the AI Governance System with the other corporate governance processes. Their solutions must complement your current operational, governance, and IT infrastructures, guaranteeing a smooth integration and ongoing harmony. This is important given the nature of governance issues, that may start in one area of responsibility, but quickly flow into other areas and morph into more challenging problems.?

4. Industry Tailoring

• Customised Solutions: Every industry presents its own set of challenges and opportunities. The optimal partner discerns this and tailors their strategies accordingly. The needs of AI Governance in the Healthcare Sector are very different from those in the Financial Services sector for instance. For AI advisory and governance work in particular, leaders should look for consultants or advisors who specialise in working in a single sector.?
• Industry-Specific Knowledge: Acquaintance with industry standards, regulatory landscapes, and competitive dynamics is crucial. This knowledge should shape the AI governance blueprint. This is also necessary to understand how developing regulation, such as the EU’s AI Act, will translate into specific industry standards. The ideals will be the same across sectors, but how they are implemented and measured will be unique.

5. Board & Executive Training Experience

• C-Suite Engagement: Engaging board members and executives is an art. Your partner should effectively translate intricate AI concepts into understandable strategic implications for the top team. Not everyone can become an AI expert overnight, nor should they need to. A good AI Governance partner will understand how to speak to leaders across organisational boundaries, translating issues and topics into their native language and highlighting their departmental or area priorities, responsibilities and motivations as well as localised ROI.
• Training Modules: Comprehensive training sessions may be essential, equipping decision-makers with the tools to comprehend and guide AI projects. For this reason, seek a partner or team that can handle the executive education and training needs of your different teams at the Board, C-Suite or operational management level.

6. Stakeholder Management View

• Inclusive Approach: It should go without saying that any change effort needs to be deeply cognisant of stakeholders, governance efforts even more so. When it comes to selecting an AI Governance partner this is amplified, given the many forms and locations in which AI can be found in organisational life today. Your chosen partner should be able to manage a broad spectrum of stakeholders, from in-house teams to external stakeholders, and should lead with a stakeholder-first perspective.
• Feedback Mechanisms: Robust systems to collate and respond to feedback ensure that the AI Governance Framework remains both dynamic and relevant. Look for partners who are aware of this and focused on building communication and information flow channels into your AI Governance System. Additionally leaders should look for AI Governance partners that seek to connect these information flows into the existing governance and strategy processes of the organisation.?

7. Flexible Change Management Approach

• Adaptive Methodologies: AI's rapid evolution demands agility. Your partner should harness flexible change management methods, and be able to pivot in response to emerging challenges and opportunities throughout the process. At a minimum they should be able to adopt different project management methods and have a keen awareness of your organisation’s culture and what will or will not work within it.?
• Collaborative Spirit: Expertise, while invaluable, should be balanced with a genuine appreciation for your team's insights. This is crucial to foster a genuine partnership, driving mutual success. All good advisors know that they help clients create change. Look for an advisor or consulting partner that understands the importance of collaboration with your senior teams. Ultimately it will be your team that runs the AI Governance System long after the partner or advisor is gone.?

Selecting an AI Governance partner may seem like a daunting task at first. CEOs should think carefully before partnering with a provider or individual to help build their new AI Governance System and processes. By keeping the above factors in mind, leaders can make a more informed choice, achieving the results and ROI that come from developing a new AI Governance System, while being assured that their new system is adequately prepared to both manage and mitigate any risks or challenges that come.?

Leadership Takeaways:

• AI is starting to permeate the cybersecurity space more and will likely alter the threat landscape greatly in the coming years.
• Industry-tailored AI applications such as FiscalNoteGPT are starting to emerge which represent a new form of mid-tier offering in the AI market.?
• Demand for chips is continuing to increase, as global and regional players seek to establish a leadership position in the AI space.
• CEOs and should be careful when selecting an external partner to help them develop their AI Governance System.
• There are several things beyond AI expertise that a leader must look for during partner-selection, including strategy acumen, a stakeholder management focus, executive training experience and a collaborative orientation.?
• By keeping these factors in mind, leaders can select the optimum partners to help them develop their AI Governance Systems and unlock the benefits of more robust risk management that come as a result.?

That’s it for this week’s edition of?AI Strategy Brief. Thanks for reading and I hope you enjoyed this update and learned something new. If you found something of value, please subscribe and share this article with others. And if you have any questions, comments, or suggestions, I’d love to hear them in the comments section below.?

See you next time!