GenAI 2025: Trends - Predictions for Corporate Leadership

Artificial Intelligence (AI) brings immense opportunities and challenges!

AI continue to evolve and integrate into professional and personal lives. Executives and technology leaders must anticipate and prepare for trends that will shape their organizations' strategies. With the advent of Generative AI (GenAI), developing effective AI and GenAI strategies has become essential. By embracing the evolving AI ecosystem, ensuring regulatory compliance, mitigating threats, and fostering strong external partnerships, organizations can position themselves for success in the dynamic GenAI landscape.

 

Corporate AI Strategy

Effective AI strategies and governance frameworks are essential to overseeing AI development and adoption. These strategies must align with corporate objectives, focusing on business value drivers, responsible AI principles, and strategic AI alignment.

• Establishing an AI vision, mission, and guiding principles that prioritize human-centric and ethical AI practices.
• Building strong teams and partnerships to ensure operational excellence and enhance data management and AI governance maturity.
• AI rapid pace materializing in many shapes and forms account for executives predicting a shift in business model where consumer and product development needs to be embedded in corporate objectives.
• Overcoming barriers such as lack of AI skills, governance challenges, and integration complexities.

AI strategy is a relatively new endeavor for many organizations, with 41% of surveys either developing a strategy or planning to do so soon. Executives must ensure alignment with broader corporate strategies to maximize value and mitigate risks.

 

Evolving AI Ecosystem

The adoption of AI and GenAI is shifting from experimental to strategic, as organizations increasingly embed AI into their workflows and operations.

• Organizations are prioritizing AI strategic use cases by assessing business value versus feasibility. Agent-augmented solutions, such as intelligent code generation and advanced data management systems, are optimizing workflows.
• Business processes, across industries such as accounting and manufacturing, are being redefined through hyper-automation, improving efficiency and accuracy.
• Autonomous agents or systems that perform actions such as purchasing, scheduling on behalf of direct involvement may set the stage for AI goals and deliver measurable profitability, as forecasted through artificial general intelligence (AGI).
• Disciplines related to maturity testing are critical to understand hallucinations related to wrong information but given the Internet era and lessons learned, embracers and early movers have paved the way for growth and a trustworthy models.

By aligning AI applications with business objectives and embedding GenAI into processes, organizations can enhance their operational performance while maintaining responsible AI principles.

 

External Partnerships and Reliance

With the expansion and evolution of AI capabilities, organizations depend on external partners and experts to optimize AI strategies and enable integration. This reliance emphasizes collaboration and innovation and supplement internal organization gap and need related to AI technology.

• GenAI solutions leverage hybrid, multi-cloud architectures, and  to access diverse models and heterogeneous composability including varying data sources, large language models (LLMs), domain-specific models, and proprietary systems across cloud-based, edge-based, and data center modes.
• GenAI capabilities embedded features within SaaS platforms or integrated via APIs streamline adoption, integration, and enhance business processes.
• External hosted platforms offer tools to accelerate AI development, foster innovation, and support scalable growth.

The emphasis on economic impact and profitability highlights the increasing importance of AI in the through partnership, while societal considerations continue to influence the conversation around its development and application. By partnering with SaaS providers, API developers, and hosted platform vendors, organizations can harness advancements in AI objectives and outcomes.

 

Privacy and Global Regulation

As AI technologies become ubiquitous, the need for robust governance, ethical standards, and regulatory compliance become increasingly important.

• Regulatory Diversity in regions are adopting varying approaches to AI regulation, with the U.S. favoring innovation-driven policies, while the European Union emphasizes safety and risk mitigation through legislation like the EU AI Act. Enforcement in the U.S. is driven by Federal Trade Commission (FTC) and Consumer financial Protection Bureau (CFPB) in comparison Innovation, Science Economic Development Canada (ISED) and Office of the Australian Commission (OAIC).
• Executives must establish responsible AI frameworks that protect against risks, ensure compliance, and support ethical innovation to balance innovation and safety.
• Educating employees to critically evaluate AI outputs and address errors is crucial to maintaining ethical standards and operational integrity.
• Legislation and new laws, such as California's legislation on malicious deepfake dissemination, aim to counter these threats and protect stakeholders. Virginia Code 18.2-386.2 prohibiting malicious dissemination or sale and Texas passing laws criminalization for similar activities.

Organizations must navigate these evolving regulations to ensure compliance while leveraging AI's potential responsibly.

 

Threats and Deepfakes

The rise of AI-powered cyberattacks, particularly deepfakes, poses significant risks to businesses and individuals. These fabricated digital media forms including manipulated images, voice cloning, and real-time video, threaten cybersecurity trust and integrity.

• Industries risks as in Healthcare has seen a surge in ransomware attacks to over 250% rise in the last five years, while the U.S. and Europe face growing fraud and data breach threats.
• Organizations must combat risks and prioritize employee education, enhance cybersecurity layered security approach, and adopt robust authentication systems.
• Proliferation of AI-Augmented Attacks within phishing and social engineering tactics leveraging AI in sophistication has led to 30% rise in successfully attempts and the success rates are only increasing.
• A proactive and offensive security approach that account for Autonomous AI agents to be developed to simulate cyberattacks, vulnerabilities, and other exploits will enhance the robustness of digital infrastructures

Mitigating deepfake risks requires proactive measures and legislative support to maintain data integrity and public trust. The intersection of AI and GenAI with security and privacy is set to undergo significant transformations in 2025.

Double-Edged Sword of MFA

Multi-factor authentication (MFA) – verifies identity using independent factors such as something you know, something you have, or who you are (biomedical) before accessing a system, application, or account.

 

Profit Margins

MFA is a $20 billion market in 2024 and with just over half of the consumers in banking and finance leveraging this technology, it's only growing (according to Market Insights and Prove). The demand for robust and layer-security solutions had driven substantial revenue growth for leading provides such as Microsoft, Cisco, Okta and Ping.

 

Benefits 

MFA is a critical component of modern cybersecurity strategies, offering robust protection against unauthorized access and data breaches. MFA provides protection against password compromises, ensuring that even if a password is stolen, the attacker cannot access the system without the additional verification factor. The benefits translate to enhanced security particularly when coupled with the broader and protection with identity and access management (IAM) suite drives. This added layer of security helps reduce the risk of data compromise, protects sensitive information, and ensures compliance with regulations like PCI-DSS, GDPR, and HIPAA.

 

·      Microsoft study revealed that MFA can lead to 98% reduction in both the risk of account reduction and compromise even in cases where credentials have been leaked.

·      Gartner research points to an average of $1.4 million savings per year in data breach costs.

·      Conversely, AT&T and UnitedHealth Group has been attributed to cybersecurity negligence for failure to implement MFA. 

 

Challenges

The added step and layer of MFA is not frictionless, and user resistance often arises due to perceptions of inconvenience. Implementation can demands substantial financial and technical investments, including ensuring system compatibility and support required to manage its inherent complexity. As with any technology, organizations must strike a balance between bolstering security and preserving a seamless user experience. By thoughtfully addressing these considerations, businesses can optimize MFA to safeguard assets while fostering user trust and satisfaction.

 

Framework and Mechanics

Organizations prioritizing robust authentication have a variety of MFA implementation methods. Traditional MFA process typically begins with this primary layer consisting of password entry. This is a unique code sent to a pre-registered mobile device via SMS or email. This code must be entered to proceed.

·      Authentication Apps such as Google or Microsoft Authenticators generate Time-Based One-Time Passwords (TOTPs). These app-based codes refresh periodically, providing a secure and efficient way to authenticate.

·      Alternatively, hardware-based tokens, such as USB security keys, a physical connection is required to validate access. These tokens offer enhanced protection against phishing and other cyber threats.

·      Yet another method is biometric authentication which leverages unique physical characteristics for identity verification such as fingerprints, facial recognition, or iris scanning. These methods are user-friendly and secure, as they rely on attributes that are difficult to replicate.

Advanced MFA supplement traditional by introducing a risk-based approach by dynamically adjusting authentication requirements based on contextual factors, such as geographic location, device registration, login behavior, and characteristics. This adaptive methodology improves user experience by streamlining access for low-risk scenarios while strengthening security in high-risk situations.

·      Adoption of MFA can be alleviated by an integrated security framework such as Single Sign-On (SSO).SSO simplifies user authentication across multiple applications by enabling users to log in once and access several systems seamlessly. 

·      Leveraging federation protocols like SAML (Security Assertion Markup Language) or OAuth, can extend across different applications or domains, ensuring consistent and secure authentication.

·      Another focus around protection of risker-level access is Privileged Access Management (PAM). PAM focuses on securing privileged accounts with elevated access levels. By incorporating MFA, PAM ensures that high-level credentials are authenticated rigorously, mitigating the risks associated with administrative access.

 

The evolution of MFA towards adaptive, risk-based methods underscores its critical role in modern cybersecurity. By integrating MFA with SSO, PAM, and other systems, organizations can fortify their defenses against unauthorized access while maintaining operational efficiency. Embracing these advanced authentication techniques is essential for protecting sensitive data, maintaining user trust, and staying ahead of emerging cyber threats.

 

Vulnerabilities

Any technology can be suspectable to attack and MAF is not immune to these faults. Comprehensive security strategy and practices is essential to effectively safeguarding against evolving threats. Failures in MFA has been tied to legacy MFA systems and ransomware related attacks, and critical flaws including a recent issue with Microsoft's Azure MFA (Dark Reading).

·      SIM swapping tactics can transfer a victim's phone number to a SIM card controlled by the attacker, enabling them to receive MFA codes sent via SMS.

·      Man-in-the-Middle (MITM) attacks result in adversaries intercepting communication between the user and the authentication system that capture MFA tokens and gaining unauthorized access.

·      Brute force code validation is a short one-time passwords (OTPs) used in some MFA systems that can be susceptible to brute-force attacks, where attackers systematically attempt all possible combinations to gain access.

 

Embracing technology to protect critical infrastructure such as MFA is paramount but not a panacea. A layered security strategy, balancing user experience and continuous improvement will deliver protection and trust.

Healthcare in Flux

The healthcare system and private insurance companies has dominated the headlines most recently due to the tragic death of UnitedHealthcare CEO. The event marks a tipping point for systemic injustices and personal hardships experienced by patients and customers alike. Reuters The discourse seemingly has played out over denial of claims and sentiments of, prioritizing profits over patient care. Supporting these theories highlight the financial and emotional toll of insurance denials and endless calls for systemic reform. New York Post

Healthcare Demand and Spending 

The U.S. healthcare system is far more complex than a quick review can capture, as evidenced by the findings and insights from various sources. The National health expenditures in 2023 reached $4.3 trillion, accounting for 18.3% of the Gross Domestic Product (GDP). Costs is attributed to administrative expenses including processing and claim denials. Additionally, studies found that private insurers denied about 17% of in-network claims which lead to out-of-pockets expense and adverse health outcomes. Moreover, directly implicating insurers with aggressive tactics to manage costs, such as prior authorizations and the use of artificial intelligence to automate claim denials.  The Wall Street Journal 

Additional factoids, according to https://crsreports.congress.gov/product/pdf/IF/IF10830, attribute to the evolving landscape of healthcare costs and coverages.

• Total healthcare spending has nearly double in the last decade to $4.5 trillion.
• Healthcare prices has grown faster than general economic inflation for example, inpatient hospital care for privately insured patients rose 13% from 2014 to 2018, compared to about 3% Medicare and Medicaid.
• Prescription drug spending is a significant driver of healthcare cost increase due in part of new costly medications and increased utilization.

The private insurance makers has also become more concentrated where three or few insurers dominate the market in many states. With a concentrated market and less choices for consumers, the propensity for higher premiums looms.

 

To that end, the demand and utilization of healthcare services has  increased due to aging population and prevalence of chronic conditions such as obesity, diabetes, and heart disease. The boarder range of services insurers are required to cover has also increased to include metal and behavioral health, and substance abuse treatment. 

Global Impact

The widespread dissatisfaction apparently parallels universal health care coverage. Affordable and accessible healthcare is problematic in more than half the world's population are without coverage according to the World Health Organization (WHO). Additionally, 2 billion people face severe financial hardship when paying out-of-pocket for healthcare and was further highlighted during the COVID-19 pandemic. https://www.who.int/news/item/18-09-2023-billions-left-behind-on-the-path-to-universal-health-coverage. Critics argue that these practices often prioritize cost savings over patient well-being, leading to widespread dissatisfaction and calls for reform.

As in most cases, the situation is exemplified in low-income and lower-middle-income countries, where higher poverty rates exacerbate the challenges of accessing quality healthcare. The global push for Universal Health Coverage (UHC) aims to address these issues, but progress has been slow and uneven.

Patient Care and Technology

The shift towards value-based care models is reflected in physicians lower reimbursement rate from insurance companies and is coupled with complex bilingual and claim processing that require addition administrative burden, workload and staffing. This results in higher healthcare costs due to patients prolonging or avoiding care which then drives more expensive treatment due to worsening health issues. When mixed with balancing cost and high-quality care, the patient do not benefit and arguably professional burnout results. When volume over satisfaction stands in the forefront, expansion of telemedicine and adoption of emerging technology becomes pivotal i.e. electronic health records (EHRs) streamline process and paperwork and AI (Artificial Intelligence) driven diagnostics and minimally invasive surgical techniques improve accuracy. Of course, complex technology require new development and implementation that can be expensive, training staff and providers consume time, and patient data and privacy raises new concerns and likely additional protection measures. 

Comprehensive Solution

While the debate over the role of private insurers will continue to make the headlines, the need for a balance between cost management, patient access to necessary care, and urgency for comprehensive reform is pivotal to everyone's mind.  Physicians face financial pressures and administrative burdens while technology offer both efficiency and benefits, however initial costs and privacy concerns loom. A multifaceted approach with coordinated efforts from policymakers to providers, insurers, and technology developments: 

• Policy reforms that promote high-value care and assistance navigating complex healthcare regulations
• Technology interoperatbility that enhance efficiency, integrates preventative care, and support robust protection of sensitive information preventive care 
• Physician support that reduce administrative burden and alleviates financial pressures to physical burnout 
• Patient-centric and sustainable care regardless of socioeconomic factors and public perception of new care models

Additional references

https://www.netsuite.com/portal/resource/articles/erp/healthcare-industry-challenges.shtml

https://www.ama-assn.org/practice-management/physician-health/6-ways-measure-progress-toward-physician-well-being

https://www.kff.org/health-costs/issue-brief/americans-challenges-with-health-care-costs/

Cybersecurity, Top of mind for the Board

Cyber Culture is Table stakes

A core principle in business management is company culture. It is imperative to develop and cultivate a cybersecurity-first mindset that aligns business processes and shared commitment among all employees and leaders. This foundation begins with a cybersecurity strategy that is closely aligned with the organization's mission and business goals. Continuously cultivating and updating this strategy is essential to navigate the rapidly evolving digital landscape. A curated enterprise-wide risk management practice fosters collaboration and facilitates a shared understanding of cybersecurity across the organization. This approach ensures that communication is effective from company officers to the board of directors.

 

Consensus and Governance of Top Risks

A shared understanding of cybersecurity and its alignment with business goals leads to collaboration and agreement on the organization's top risks. Protecting the "Crown Jewels," such as sensitive and proprietary information, is vital for building trust with customers and partners. A security-by-design methodology, including multi-layered security approach and zero-trust architecture (ZTA), is fundamental. This should be reinforced through compliance and governance frameworks, such as the NIST Cybersecurity Framework (NIST CSF), ISO/IEC 27001, Critical Security Controls (CSF), PCI DSS, HIPAA, and COBIT. These standards help ensure robust protection and governance while addressing regulatory requirements.

 

Enterprise-Wide Risk Management

Cybersecurity risk management is a balance of trade-offs. Business strategies are akin to business decisions that compete for strategic priorities, operational effectiveness, and financial imperatives. A prioritized approach to risk, whether through mitigation, transfer, or resolution, is crucial. Additionally, measuring and tracking progress are critical for driving continuous maturity enhancements. By establishing key performance indicators (KPIs) and benchmarks, it provides transparency and facilitates accountability for long-term success. These formal, deliberate process reinforces progress and elevates cybersecurity maturity across the organization.

 

Cybersecurity Awareness and Communication

Cybersecurity awareness is rooted on effective communication and acknowledgment across all levels of the organization. Establishing a consensus on top risks and aligning actions to address these risks in a prioritized manner is core to success. This structure enables compliance with regulatory and contractual obligations. Key components include maintaining an Incident Response Plan (IRP) and conducting Tabletop Exercises (TTX). These exercises simulate potential incidents, handling preparedness activities, and assuring compliance. Disaster Recovery Plans (DRP) and Business Continuity Plans (BCP) also play integral roles in aligning operational processes and communication templates.  Effective communication, particularly for external engagements, relies on key stakeholders such as the Legal, Public Affairs, and External Communications teams to ensure alignment, consistency, and legal obligations.

 

Cybersecurity Investments

It is equally important to assess which cybersecurity investments have not been funded, their deployment status, and any items on the organization's "holiday wish list." These insights can guide discussions on fundamental business needs and foster innovation. For example, Third-Party Risk Management (TPRM) is increasingly critical, given the interconnected technology platforms and services essential to modern business operations. This includes cloud and data storage, threat intelligence collaboration, supply chain security, and critical infrastructure. Emerging risks such as Artificial Intelligence (AI) and Generative AI (GenAI) further emphasize the need for strategic investment and proactive governance.

 

By embedding cybersecurity into organizational culture, prioritizing risks, and fostering effective communication and governance, organizations can align their cybersecurity practices to meet board level expectations while safeguarding their operational integrity and customer trust.

Expanded perspective on the WSJ's Four Smart Questions for Boards Overseeing Cybersecurity

Trust in Performance Reviews

Performance reviews and the appraisal process are essential components of an organization's commitment to employee development and effectiveness. A structured and thoughtful approach not only enhances professional growth but also fosters trust, ensuring feedback is both constructive and actionable. When executed effectively, performance reviews become a powerful opportunity to align individual performance with organizational goals.

Intentional Preparation. Structured planning demonstrates an organization's commitment to the performance review process. Managers must invest time to identify and understand performance-related issues, whether stemming from motivation, ability, or external factors. Recognizing intrinsic and extrinsic influences on performance ensures a fair evaluation. Clear performance standards and process transparency are crucial to maintaining fairness and trust. Employees need to understand the framework within which their performance evaluation, enabling them to identify their strengths and areas for improvement. Combining quantitative feedback with qualitative narrative insights ensures a balanced evaluation — particularly when tied to monetary incentives. While numerical ratings provide clarity and tangible outcomes, narrative feedback offers broader, actionable insights that guide employee growth. This thoughtful approach encourages fairness, reinforces transparency, and sets clear expectations.

Action Plans. The cornerstone of an effective performance review lies in the accurate and actionable evaluation of an employee's performance and skills. This process must focus on skill development in alignment with job responsibilities and broader organizational strategy. Self-evaluation is a preparatory step that provide employees with an opportunity to reflect on their accomplishments and contributions. Formal mid-year reviews alongside continuous documentation and note-taking, further strengthen the annual evaluation process. These practices ensure that performance reviews are rooted in evidence and ongoing dialogue rather than subjective recall.

Two-Way Conversation. Performance reviews must foster two-way conversations that deliver specific and behavior-based feedback. This dialogue should reference concrete examples to illustrate both strengths and areas for improvement. Vague or generalized feedback can lead to biased assessments that may misrepresent an employee's abilities or potential and therefore, contribute to disengagement or turnover. Prioritizing two-way and open-ended dialog addresses not only performance outcomes but also the rationale behind them. Exploring assumptions, perspectives, and goals from both sides ensures understanding, mitigates biases, and confirms alignment between employee efforts and organizational priorities.

Calibration Group. Establishing calibration groups is cornerstone to standardize scores across the organization. Diversely represented calibration groups standardize performance scores across the organization, bringing multiple perspectives to the evaluation process and reducing similarity bias. Ensuring the people managers focus on ideas and achievements rather than ingroup affiliations is crucial for conducting effective and fair performance reviews. 

Continuous Development: Providing managers with training on delivering feedback refines their ability to conduct fair, transparent, and effective reviews. Additionally, regular feedback creates an environment of trust and care, where leaders demonstrate empathy and commitment to their teams' success. These measures reflect the organization's maturity in performance reviews and continue to creating an inclusive workplace. 

The commitment to thoughtful performance management not only benefits individuals but also propels organizational success.