The company is targeting a fragmented market of robot makers
With President-elect Donald Trump preparing to take office, business technology leaders say they are bracing for immediate and long-term impacts from policies he will likely institute. That is in areas including tariffs, regulating artificial intelligence and mergers and acquisitions.
For chief information officers, AI continues to be top of mind. While the urgency to deploy the technology inside their organizations continues unabated, CIOs are keeping a keen eye on how the federal government might play a role in reining in the technology, or encouraging it to thrive.
โThe way AI affects a CIOโs job is primarily around strategic planning,โ said Suvajit Basu, the former CIO of Goya Foods. That includes things like whether AI will be โintelligent enoughโ to improve the efficiency of logistics planning, and how it will shape the workforce, he said.
Tariffs and higher hardware costs
One of the first areas Trump can make an impact is in tariffs, where the president-elect can act without seeking congressional approval. He has proposed tariffs of at least 60% on China, and 10% to 20% on other countriesโlifting U.S. tariff rates to their highest since the 1930s.
John Roese, global chief technology officer and chief AI officer of Dell. Photo: Dell
Many American companies rely on foreign-made hardwareโincluding laptops and smartphonesโfor their employees. If prices for those goods go up, some CIOs say their technology budgets could be affected.
Thomas Phelps, senior vice president of corporate strategy and CIO of Long Beach, Calif.-based Laserfiche, said he is concerned because the software company relies on some imported hardware, and its technology budget is already fairly set for next year.
Others say they are ready for anything. John Roese, global chief technology officer and chief AI officer of Dell, said companies are generally adaptable to changing tariff rates. โWe were able to navigate supply chain shortages, tariffs, and whatever happens, weโll adapt,โ Roese said.
AI under the spotlight
Since the launch of generative AI-based chatbots two years ago, AI has become a far bigger issue for the federal government than it was during Trumpโs prior presidency.
It is likely that President-elect Trump will take a more relaxed approach to federal oversight of AI, especially as Big Tech companies and startups alike have pushed for a light touch on AI safety rules. The benefit of looser rules, they say, is keeping innovation flowing.
Trump has already said he would dismantle the Biden administrationโs executive order on AI, which sought to manage a range of the technologyโs threats from privacy to national security.
Since the order was enacted last year, the business communityโs reaction to it has been mixed. Dellโs Roese said that while it provided a framework, it โdidnโt change what private industry was doing.โ โIt reflected what was happening,โ he said, โas opposed to shaping it.โ
Still, removing the order has the benefit of cutting bureaucracy and speeding up the release of AI products, according to Daniel Castro, vice president of the Big Tech-funded think tank Information Technology and Innovation Foundation. Companies interested in using AI in riskier areas like hiring or extending credit might also feel more comfortable making the leap, he said.
The move also puts more work on companiesโ shoulders to investigate AI model safety and potential bias. Vish Narendra, CIO of Graphic Packaging International, said AI regulation helps enterprises understand why different models spit out various results. โThe ethics of AI is going to be a minefield that companies are going to have to tiptoe around for a while until they figure it out,โ he said.
Doing away with Bidenโs AI order doesnโt mean there wonโt be any AI rules at all, said Mark MacCarthy, a nonresident senior fellow in governance studies at the Brookings Institution. โThe real change will be to put AI regulation back in the hands of sectoral regulators,โ he said, putting employment and financial regulators in position to manage AIโs use in those areas.
Dealing with more deals
The administration of President-elect Trump will likely bring about a deregulated mergers-and-acquisitions landscape, according to Chris Farmer, founder and chief executive of venture-capital firm SignalFire.
โYou need a robust M&A market for the venture market, and frankly, the innovation economy in general to thrive,โ Farmer said.
Chris Farmer, founder and CEO of SignalFire. Photo: Kimberly White/Getty Images
That is a good thing in the age of AI because the technology will โcontinue to feed the market as larger companies will try to acquire talent and technology,โ Basu, the former Goya CIO said.
Plus, the new Republican administration will likely encourage โrisky betsโ on AI development, according to Shawn Helms, co-head of the technology transactions and outsourcing practice at law firm McDermott Will & Emery.
Still, a more freewheeling M&A environment isnโt all good news for CIOs.
While vendor acquisitions might improve the suite of products tech leaders have to choose from, it also creates more work because they will need to ensure their IT systems are integrated and consistent, said Basheer Janjua, chief digital officer at software firm CloudBees.
The recent Broadcom purchase of VMware, for instance, drew the ire of some CIOs because the microchip company made changes such as shaving down VMwareโs product offerings and ending perpetual license sales.
At the moment, it is too soon to know what President-elect Trump is thinking. But Dellโs Roese, who says the personal computer giant has worked with the Trump administration in the past, said it would work with them again.
โWeโve been doing this for a very long time,โ he said. โMany of these technologies are kind of above politics.โ