How investment giant Vanguard’s CIO is placing big tech bets today to create the AI digital advisor of tomorrow

Nitin Tandon, the global chief information officer of Vanguard, says artificial intelligence is a perfect tool to address the natural imbalance between the millions of clients the investment management company serves and the just 20,000 people it employs.

“If you want to offer advice to the 50 million clients that we have today, there aren’t enough advisors in the world to do that,” says Tandon. He says that AI can improve Vanguard’s operational efficiency and create opportunities to hyper-personalize financial guidance at a massive scale, and that it could one day serve as a trusted digital advisor. “For the future, if you take this a step further, this could be a voicebot just like Alexa, where you can ask how your portfolio is doing,” adds Tandon.

Today, Vanguard, which has nearly $12 trillion in assets under management, is actively piloting various ways to infuse AI to improve the client experience. Vanguard rolled out an AI chatbot to around 2,000 employees to internally test the functionality of natural language responses to client questions, including “What’s my account balance?” and “How is my portfolio performing?” Tandon says he feels that the technology is advanced enough to handle this capability, but he wants to keep a close eye out for hallucinations, which are false or misleading outputs, and ensure the proper guardrails are in place so that the tool isn’t veering into offering financial advice.

Internally, Tandon has rolled out generative AI that permeates the business and now touches every single employee. These tools include Microsoft Copilot; AI coding-assistant tools for software developers; AI-enabled content creation platforms to support marketers; and transcription functionality to record and summarize meetings.

Earlier this year, Vanguard also debuted a new generative AI capability that produces customized client summaries for the company’s financial advisors. Using generative AI, the advisors can tailor the language to match the financial acumen of each client.

Focus areas for Tandon’s AI strategic bets include improving the client experience; the creation of a digital advisor; fraud and cyber; and developing highly specific AI tools for three roles that he believes can benefit the most from AI-driven productivity. Those focus roles are financial advisors, sales assistants, and software developers. 

Already, Tandon reports that 97% of Vanguard’s employees are using AI tools, with weekly usage at 75% and daily usage at 50%. But the question that hangs over his head—and that of every CIO—is how to measure the return on investment. Tandon says he’s confident that there is value. When marketers use AI for content creation, they are saving time, and the same can be said for software developers. He can measure these gains through A/B testing that has tracked productivity for employees using AI compared to their colleagues who don’t.

“The value is quantifiable,” says Tandon. “Can I harvest that value? Not so much, and that will take a bit longer.”

His north star is that ultimately, as long as AI tools are making employees more efficient, improving the client experience, and delivering better client outcomes, that’s all a win. “If you go after that, you will be able to harvest the productivity gain,” adds Tandon.

Tandon joined Vanguard as chief technology officer in 2019 after a 17-year career at Deloitte, where he led the consulting giant’s cloud practice serving the financial services industry. Vanguard was a prior client, and he was drawn to the company’s unique investor-owned structure and the role that technology plays at the core of the business. Vanguard operates no brick-and-mortar locations, and more than 95% of its financial services transactions are performed digitally.

“It felt very different from all other financial services companies,” says Tandon. He became global CIO in 2021.

He also lauds external partnerships. Vanguard’s investments in the space include generative AI startup Writer and compliance AI startup Norm Ai. Employees at Vanguard are already using both tools internally.

A big internal project he undertook shortly after joining Vanguard was an enterprise-wide tech overhaul that he says is 86% completed. He led the migration of the company’s technology stack to the public cloud, and launched a brand new website and mobile app to make the functionality more intuitive for clients.

Tandon says he also developed a more rigorous process to measure the value of Vanguard’s data and analytics investments.

“One thing we were not happy about is, ‘Hey, we’re spending a lot of money on data, are we seeing the commensurate value?” asks Tandon. He wasn’t pleased with the prior structure, leading Vanguard to consolidate 10 data and analytics teams that were dispersed across the various business divisions into one centralized team. Ryann Swann, Vanguard’s chief data analytics officer, was hired in 2021 to steer that organization.

As he navigates Vanguard’s future with AI, Tandon says it is critical to rethink all systems, processes, and products, and how all of them can be enabled by AI. He asserts this cannot just be centrally driven. Teams need to be empowered to chart their own course.

“Our approach is to diffuse AI into the fabric of the system so that people are empowered with the right tools and the right training,” says Tandon. “And then they can reimagine their journeys, their products, their services, using AI.”

By the way, this will be our last newsletter of 2025; we’ll be back in your inbox on Wednesday, Jan. 7. Enjoy your holidays, and Happy New Year.

John Kell

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This story was originally featured on Fortune.com