All managers need to understand artificial intelligence

30. maj 2022 kl. 11:06
All managers need to understand artificial intelligence
Illustration: Todai.
To thrive in a world governed by data and driven by algorithms, managers must acquire competences in artificial intelligence to understand the possibilities of using AI to implement the company’s strategy. This opinion piece gives a few suggestions on the first points of the curriculum.
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The opinions expressed in this article are solely those of the author.

Recently, I carried out a major interview study of the Danish companies’ implementation of artificial intelligence (AI)—or lack thereof. Many managers are gradually realizing that AI will be the driving force behind innovation and competitiveness in the future. Therefore, they now face a number of AI realities: AI is a source of untapped potential, it is an existential risk—if you are too late in the race—and it is difficult.

Contrary to many people’s beliefs, the biggest obstacle in AI initiatives is rarely the technology itself; instead, it is poor interconnection with the business. Because when a company is to get started with AI, it is usually not about technology, but about strategy.

Still, the responsibility for AI lies with the IT department in an astonishingly large number of organizations. Leadership, organizational change, resistance to transformation, and strategy are all determinants of your AI project’s success. If you delegate the AI initiatives to the IT department that does not have enough insight into strategy and business to take all of these factors into account, you have failed as a manager.

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Therefore, it is crucial that you acquire competences in artificial intelligence yourself.

AI washing causes confusion

A pitfall that many organizations overlook is that AI is a means to an end, not an end in itself. AI is a tool to be used to support the organization’s existing strategy, and it does not create value in isolation. But there are many examples of companies putting the cart in front of the horse. They focus on implementing a new technology and forget to integrate the change into the overall business strategy.

We have also seen a trend towards so-called “AI washing”—a descendant of the term “greenwashing”—in which companies have slapped an AI sticker on their products, in some cases the whole company, in an assumption that it would make them more attractive. And although the products have seemed intelligent, in many cases it has not been due to AI. This has created confusion about what AI really is, and it made it difficult for employees to identify the good AI possibilities when management calls everything “AI”.

Managers need to be able to assess which digital tools—including AI—can bring them closer to the company’s strategic goals. But you cannot include AI in those considerations unless you have a general understanding of what AI can and cannot do.

Build AI competences across the company

AI is not a technical challenge, it is a business challenge. We need AI to make better decisions, to improve our productivity, and to design and develop new products and services. Therefore, we need AI competences across the whole company in order to get the domain experts on board.

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There are two benefits to this. First, a high level understanding of AI can enable employees to spot which AI usage scenarios can create the most value in the business.

Second, unless you develop artificial intelligence yourself, your company will apply the technology through software solutions and consulting hours. AI competences enable you to become intelligent buyers and demand the right solutions.

This requires that you as a manager commit to starting AI initiatives from the top down and at the same time signal support for AI initiatives from the employees. The company must build AI competences, and it is the management that must take responsibility for this to happen.

Lack of knowledge about AI is the biggest barrier for Danish companies

The results of my study on the use of AI in Danish companies clearly showed that a lack of knowledge about AI and how technology can create business value are the most prominent barriers to Danish companies implementing AI.

We must close the competence gap that exists between a general understanding that AI could be interesting and what exactly one can use the technology for in one’s own company. And how do we do that? The short answer is that management needs to be trained in AI.

Here is my suggestion on what the curriculum could look like:

  • Basic understanding of AI, what the technology can and cannot do.
  • Understanding AI’s impact on the company’s strategy.
  • Drawing inspiration from case studies of companies that have used AI in your industry or sector.
  • With that knowledge, managers can actually manage AI.

AI is a reality

AI is not a choice, it is a reality. If your employees have an inbox free of spam, use Google Maps to find their way between meetings, or use Facebook ads for marketing, then you already use AI in your business on a daily basis.

In other words, artificial intelligence is upon us, and we have in all probability only seen the beginning of it. The new wave of advances in AI could be the tsunami that drowns you, or it could become the wave your business rides on toward growth. Therefore, it is absolutely crucial that you as a manager seize the opportunity and take responsibility for creating value with AI. But you will not succeed if you delegate the responsibility for AI to the IT department.

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Do you want to contribute to the debate with an opinion piece? Send your draft (3000–5000 characters) to Tech Management's editorial assistant Albert Jonathan Nyeland at ajn@ing.dk.

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