AI in Business: The Leader’s Essential Guide

Artificial intelligence (AI) is transforming businesses in ways no one could have imagined before the technology’s emergence. From improving operational efficiencies and revenue to delivering personalized customer experiences and strengthening market competitiveness, AI’s benefits are profound. But left unchecked, AI may not be reliable, ethical, and free from bias.

In this article, we share what executive leaders need to know about AI and the importance of human involvement in its implementation and management.

AI’s rapid adoption is unprecedented. Its invisible presence shapes our everyday lives, from the decisions we make to the services we rely on. Whether its personalized recommendations, automated customer service, or predictive analytics, AI integrates into modern life seamlessly. By 2027, spending on AI software will grow to $297.9 billion, with a compound annual growth rate of 19.1%, according to Gartner.

The technology is also mainstream among companies worldwide. In a 2024 McKinsey survey, 65% of 1,363 respondents said their organizations are using generative AI regularly, helping them to reduce costs and increase revenue. AI improves workplace efficiency by automating routine operations. By 2027, 42% of business tasks will be automated, a 2023 World Economic Forum report showed. AI also boosts productivity by streamlining operations, managing data, and accelerating business leaders’ decision-making. AI can analyze massive amounts of data and provide instant insights.

Job disruption

As businesses reap the benefits of automation and productivity improvements, workers’ fears about losing their jobs is on the rise. In fact, employees believe AI can perform nearly one-third of their tasks, a 2023 Asana survey of 4,546 employees showed. Their concerns may be valid. In addition to 42% of business tasks becoming automated by 2027, the World Economic Forum report revealed that through 2028, 44% of workers’ skills will be disrupted. The largest losses are expected in administrative roles, including data entry, accounting, and secretarial work, and security, factory, and commerce positions.

Thirty-five percent of 2,500 CEOs say their employees will require retraining and reskilling over the next three years. The highest priority for skills training is analytical thinking, followed by creative thinking.

Meanwhile, AI is spurring upskilling and reskilling efforts at many companies. Thirty-five percent of 2,500 CEOs say their employees will require retraining and reskilling over the next three years, according to a 2024 IBM CEO survey. The highest priority for skills training is analytical thinking, followed by creative thinking, the World Economic Forum report showed. Training workers to use AI and big data ranks third among company skills-training priorities.

AI’s limits could save some jobs

While AI is a powerful tool, its current limits prevent it from performing all human tasks, according to Stanford University’s 2024 AI Index Report.

“AI beats humans on some tasks, but not on all,” the report’s authors wrote. “AI has surpassed human performance on several benchmarks, including some in image classification, visual reasoning, and English understanding. Yet it trails behind on more complex tasks like competition-level mathematics, visual commonsense reasoning, and planning.”

On another positive note, AI’s rise is generating new job opportunities for those who can design, develop, implement, and oversee AI systems. Half of CEOs who responded to the 2024 IBM CEO survey said they’re hiring for generative AI-related roles that didn’t exist last year. AI and machine learning specialists top the list of fast-growing jobs, according to the World Economic Forum. But finding qualified talent could be a hurdle. Fifty-three percent of CEOs said they’re already struggling to fill key technology roles, according to the CEO IBM survey results.

Risks of unsupervised AI

Ethical concerns, including responsible use, bias, and privacy, are increasingly at the forefront of AI development and usage. AI systems analyze large amounts of data that can reflect society’s biases. The data may also be incomplete or inaccurate, compounding errors and leading to unfair or flawed decision-making processes.

For example, if a recruitment AI is trained on historical hiring data, it can learn and perpetuate biases against certain demographics, such as race or gender. Job candidates from marginalized communities may be particularly at risk. Amazon scrapped an AI recruiting tool it had developed when the company found the system was biased against women. The AI had been trained on resumes Amazon received over a 10-year period that were predominantly from men.

AI systems analyze large amounts of data that can reflect society’s biases. The data may also be incomplete or inaccurate, compounding errors and leading to unfair or flawed decision-making processes.

Despite these issues, as many as 83% of employers use AI algorithms to help in hiring; that’s 99% for Fortune 500 companies, according to the Equal Employment Opportunity Commission. Relying on AI can lead to discriminatory hiring practices, exposing companies to reputational, legal, and financial risks.

Another flaw is the lack of transparency in AI algorithms. It’s difficult to know how AI systems make decisions. The developers behind the technology aren’t even sure how AI derives its outputs from the vast amounts of data it parses. Without knowing how the technology influences hiring decisions, it’s all but impossible to eliminate discriminatory employment practices using AI alone.

Human-centered AI

Humans play a crucial role in ensuring the ethical use of AI. They can identify and mitigate biases in AI models and provide context and insights that the technology lacks. A collaborative approach that capitalizes on human abilities and AI efficiency may be the new way forward. Human-centered AI integrates AI with human values and needs. Employee empowerment and ethical considerations would take priority in hiring.

For example, instead of relying solely on AI to recommend job candidates, hiring teams would consider interpersonal and judgment-based aspects, such as applicants’ personalities and cultural fit. Experienced recruiters’ and leadership consultants’ intuition and ability to evaluate candidates goes far beyond what a computer can do. They can determine how well a prospective employee would fit into an organization and contribute to its culture and goals.

By combining human intuition with AI’s efficiency, companies could create a more inclusive and supportive hiring process than relying on AI alone. In addition, continuous human oversight would ensure that AI systems are transparent and interpretable, enabling stakeholders to understand and trust AI-driven decisions. This would help create fair and equitable hiring by ensuring companies comply with antidiscrimination laws and address potential biases.

Leadership in the AI era

AI is predicted to expand at a speed best measured in light-years, influencing daily life, corporate operations, and decision-making. CEOs cite generative AI adoption as critical to success, but 64% of those IBM surveyed said the technology is changing faster than people can keep up with. Executives may have little choice but to embrace the unknown. Visionary thinking – while developing technology and teams equally – will be critical for future success.

To navigate this changing landscape, business leaders must help their employees see AI’s benefits to allay fears of job displacement. By motivating their workforces and helping them understand how AI can make their jobs easier, employees will be more likely to embrace the technology. Automation of routine and repetitive tasks saves employees time, allowing them to focus on tasks that involve reasoning, creativity, ingenuity, and problem-solving. This acceptance can lead to improved productivity, enhanced job satisfaction, and a collaborative environment where human skills and AI capabilities complement each other.

Executives may have little choice but to embrace the unknown. Visionary thinking – while developing technology and teams equally – will be critical for future success.

Moreover, business leaders must address workers’ skills gaps to realize AI’s full potential. Employees need clear guidelines, training and accessible AI tools that enhance – not replace – humans. If companies don’t put steps in place to upskill and reskill their workforces, AI could increase unemployment. The 2023 Asana survey showed that only 17% of employees received training on how to use AI in their jobs. Those who already have marginalized backgrounds could face the highest risk of being displaced.

Executives must also create thoughtful guardrails to innovate while ensuring the ethical deployment of AI. A safe framework for governance will help ensure fairness and prevent harm to current and prospective employees. If business leaders need an incentive to deploy safeguards, here’s one: IT professionals largely agree that consumers are more likely to choose services from companies that have transparent and ethical AI practices, the IBM CEO survey revealed.

Additionally, it will be critical for business leaders to balance human talent and AI capabilities using a collaborative approach. While AI can provide insights and data-driven analyses, it can’t beat humans in critical thinking, understanding emotion, judging culture and nuance, and resolving problems and conflicts. Human understanding, reasoning, and communication are valuable abilities that AI lacks.

Navigating AI integration

In the rapidly evolving AI landscape, leadership plays a pivotal role in overseeing AI strategies to ensure they’re effective and ethical. As organizations increasingly adopt AI technologies to enhance efficiency, drive innovation, and gain competitive advantages, strong leadership is required. Executives are not only responsible for integrating AI into business operations, but also for steering its implementation in a way that aligns with organizational strategy, goals, and values.

Leaders must identify opportunities for which AI can create value while avoiding the potential pitfalls associated with unsupervised or biased AI systems. By setting clear objectives and providing transparency and governance, they can ensure that AI initiatives align with strategic priorities and position their organizations as technology pioneers.

Executives can drive success by:

  • Accelerating and increasing investment in AI technology: Early adopters of robust AI systems are positioned to unlock new growth opportunities, improve productivity, reduce costs, and increase revenue.
  • Promoting the ethical use of AI: Establish protocols for fairness and transparency. Rigorous human oversight and continuous evaluation will help ensure AI’s responsible use, protecting organizational reputation and trust.
  • Maintaining open communication: Share the benefits of AI with employees, customers, and partners, and address any concerns they may have. This will build trust and encourage buy-in, which is essential for implementing AI strategies.
  • Viewing AI as a collaborator: Collaboration between humans and AI improves business outcomes by capitalizing on the skills of humans and intelligent computers. This will help organizations amplify productivity while creating agile, competitive, forward-thinking enterprises.
  • Investing in upskilling and reskilling: Training and development programs will help employees remain adaptable and capable. They’ll be able to focus on the more creative and complex aspects of their jobs than is possible without AI.
  • Reimagining job roles and processes: Reconsider employee responsibilities and workflows in light of AI’s capabilities. Pinpointing areas where AI can boost efficiency and productivity can transform business operations.
  • Identifying IT workforce gaps and hiring proactively: Demand is high for skilled professionals who can design, develop, implement, and maintain AI technology, and these workers are in short supply. Any delays in filling open roles could be detrimental to achieving strategic goals.

The best of both worlds

AI thrives alongside human expertise. This collaboration is essential for ensuring responsible AI development and deployment. By ensuring ethical use, providing contextual relevance, and maintaining open communication with stakeholders, businesses can position themselves as leaders in the digital age while avoiding the problems AI presents. Ultimately, the synergy between human and AI intelligence paves the way for better business outcomes while driving innovation and progress.

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