{"id":18879,"date":"2026-03-02T12:41:32","date_gmt":"2026-03-02T12:41:32","guid":{"rendered":"https:\/\/ideainthebox.com\/index.php\/2026\/03\/02\/balancing-innovation-and-risk-in-the-age-of-ai\/"},"modified":"2026-03-02T12:41:32","modified_gmt":"2026-03-02T12:41:32","slug":"balancing-innovation-and-risk-in-the-age-of-ai","status":"publish","type":"post","link":"https:\/\/ideainthebox.com\/index.php\/2026\/03\/02\/balancing-innovation-and-risk-in-the-age-of-ai\/","title":{"rendered":"Balancing Innovation and Risk in the Age of AI"},"content":{"rendered":"
\n
\n\"\"
\n

Shawn Read\/MIT SMR<\/p>\n<\/figcaption><\/figure>\n<\/p>\n

Monica Caldas<\/span> is executive vice president and global CIO of Liberty Mutual Insurance. Before joining the company in 2018, she spent 17 years at General Electric working on transformation projects, including digitizing supply chains and using data to predict locomotive engine failures. An immigrant from Portugal who came to the U.S. at age 8, Caldas has had a problem-solving orientation throughout her career. Caldas received the 2025 MIT Sloan CIO Leadership Award for her work at Liberty Mutual and her efforts to champion women in STEM. MIT Sloan Management Review spoke with Caldas about her approach to deploying generative AI, managing modernization, and developing talent. This interview has been edited for clarity and length.<\/p>\n

How do you think about the main function of the CIO role, especially as technology evolves so rapidly?<\/strong><\/p>\n

Monica Caldas:<\/strong> I look at the role through two lenses: defense and offense. The job is to protect data and make sure that you have systems that are secure and stable so that the company can operate. But you simultaneously have to play offense by building new features and functionality. <\/p>\n

That framework is evergreen, regardless of the time and industry you\u2019re leading in. Today, if you want to take advantage of the next generation of data and AI capabilities, you have to approach offense and defense with the same intensity.<\/p>\n

I speak to a lot of CIOs in my network, and we\u2019re all navigating this modernization journey. If you have structured and unstructured data that is isolated in a variety of systems and you can\u2019t quickly access it, you\u2019re going to hit a limit of what you can do with advanced generative AI capabilities. So while I want to be a first mover and deploy new technologies quickly, in a heavily regulated industry like ours, if you don\u2019t have secure, stable systems, you have not earned the right to do so.<\/p>\n<\/p>\n

How has Liberty Mutual approached generative AI deployment?<\/strong><\/p>\n

Caldas:<\/strong> The first thing we did was launch a responsible AI steering committee to orient ourselves to the risks and navigate them properly. We then set up experimentation frameworks to help our employees develop an intuition of how to use it and manage the risks and opportunities. Employees have to first go through training that makes sure they understand the risks, the hallucinations that may occur, and our expectations of how to use the tool. <\/p>\n

In our help desk, we deployed an internal agent called Libby, which is attached to our knowledge database and has instrumentation on issues happening in the environment to predict where employees might have problems. It has automated previously manual workflows, and we\u2019ve been able to redeploy help desk employees into work that had been in the backlog.<\/p>\n<\/p>\n

We\u2019ve identified 35% of our software development life cycle where we can deploy GenAI to support our engineers. We\u2019re finding that engineers with more seniority can really fly, as you might expect. Junior engineers need more mentoring to capitalize on the capability.<\/p>\n

It\u2019s not just about doing more. Productivity is multidimensional. It\u2019s about quality, time to make decisions, and serving customers with better products.<\/p>\n

How is generative AI shaping your modernization efforts?<\/strong><\/p>\n

Caldas:<\/strong> We have a variety of different technology stacks, and modernization is not just about lifting and shifting. Some of it is cleaning up and retiring things. Some of it is actual transformation. <\/p>\n

We\u2019re finding that while you can use GenAI to do code, you also need modern architecture. Otherwise, you try to turn COBOL into Java and end up with \u201cJobol.\u201d It doesn\u2019t have all the modern architecture stack capabilities you need. GenAI is not a magic wand where you press a button and new code comes out. Yeah, code comes out, but it\u2019s not ready for production. You\u2019ve got to add a lot of nonfunctional requirements, like security protocols.<\/p>\n<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Shawn Read\/MIT SMR Monica Caldas is executive vice president and […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"content-type":"","footnotes":""},"categories":[194],"tags":[],"class_list":["post-18879","post","type-post","status-publish","format-standard","hentry","category-graphic-design"],"acf":[],"_links":{"self":[{"href":"https:\/\/ideainthebox.com\/index.php\/wp-json\/wp\/v2\/posts\/18879","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ideainthebox.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ideainthebox.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ideainthebox.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/ideainthebox.com\/index.php\/wp-json\/wp\/v2\/comments?post=18879"}],"version-history":[{"count":0,"href":"https:\/\/ideainthebox.com\/index.php\/wp-json\/wp\/v2\/posts\/18879\/revisions"}],"wp:attachment":[{"href":"https:\/\/ideainthebox.com\/index.php\/wp-json\/wp\/v2\/media?parent=18879"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ideainthebox.com\/index.php\/wp-json\/wp\/v2\/categories?post=18879"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ideainthebox.com\/index.php\/wp-json\/wp\/v2\/tags?post=18879"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}