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Zoho CEO's Reality Check, Unmasking AI's Limitations and Weaknesses

Zoho CEO's Job Security Promise, Weathering Economic Pressures with Integrity

22 July 2023

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Kunal Tyagi

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  • AI's limitations and weaknesses are becoming evident as it becomes more prevalent in business operations.

  • Zoho's CEO, Sridhar Vembu, believes AI can replace roles but emphasizes that human employees will remain crucial in the workforce.

  • Zoho is actively exploring AI, launching generative AI Zoho applications, and investing in building its own large language model (LLM) to process natural language for various tasks.

In the fast-paced world of technology, artificial intelligence (AI) has been making waves, promising to revolutionize operations and automate processes. However, as AI becomes more prevalent, its limitations and weaknesses are becoming apparent. Zoho's co-founder and CEO, Sridhar Vembu, recently addressed these issues during a keynote address to Chief Information Officers (CIOs) at an event in Chennai. Vembu emphasized that while AI can replace certain roles, human employees will always play a vital role in the workforce.


According to Vembu, AI's potential in customer support might not be as promising as once believed. He highlighted the diminishing performance of language models like GPT-4, citing global research on the subject. This indicates that AI may not be the immediate solution for customer support-related tasks. In a survey of 8,000 Zoho employees, it was found that although 52% used the AI-powered ChatGPT regularly, 30% had decreased usage, and 15% had entirely stopped using it. As the initial AI hype cycle peaks, the challenge lies in finding practical enterprise use cases for the technology.


Despite these challenges, Zoho remains committed to exploring the AI space. They have already launched generative AI Zoho application extensions and integrations powered by ChatGPT. Additionally, Zoho is investing in building its own large language model (LLM) similar to OpenAI's GPT and Google's PaLM 2 models, reflecting their dedication to understanding and processing natural language for various tasks.


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Vembu's advocacy for an AI policy in India further underscores the company's commitment to transparency and openness in the AI domain. The proposed policy aims to provide clear guidelines for AI implementation while prioritizing ethical and responsible practices.


The broader economic landscape has also affected the SaaS industry, with macroeconomic pressures impacting businesses like Zoho and its rival, Freshworks. Despite the slowdown, Vembu reiterated that Zoho's philosophy remains focused on preserving jobs. While the company experienced a downturn and reduced hiring in FY22, they refrained from laying off any employees, prioritizing their well-being and job security.


Despite the challenges and limitations, AI continues to be a transformative force in various industries, offering significant benefits in programming, coding, and low code/no-code applications. As the technology evolves, the focus shifts from the AI hype cycle to identifying meaningful use cases that can enhance business operations and create value for both companies and their employees.


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