How leaders should prep up to lead AI enabled business

Machines replacing humans! It’s happened before, and it will keep happening. From Gutenberg’s printing press in the 15th century which impacted the jobs of scribes and copiers, to mechanized agriculture in the 19th century which reduced the need for manual farm labor. In more recent times, Automatic Teller Machines (ATMs) impacted banking jobs, and then with digital money and cashless transactions reducing the need for ATMs, there was an impact on ATM-related jobs themselves. These are just a few examples of changes that provided great opportunities for business and led to improvements in productivity, efficiency, speed and cost savings. 

They were necessary for mankind to make progress. It is also true that these changes created new jobs. From jobs related to running printing presses, factory jobs due to industrialization, to jobs related to Internet banking, many new jobs came up. Similarly, Artificial Intelligence (AI) may create new revenue streams, for e.g., drone manufacturing or neural network applications in customer preferences. This will lead to new job creation in AI and its related disciplines. Of course, some jobs will also get automated. 

It’s the same old story of change. Of new taking over the old – a universal truth. Whenever such changes occur, leaders have a huge responsibility to understand the change, leverage the opportunities offered by it, and lessen the pain of the transition. 

Here are three capabilities which leaders need to enhance within themselves, to ensure a smoother transition to an AI-enabled business.

Developing curiosity and awareness

A leader’s antennae need to be sharp and curious, always scanning the environment for changes impacting his business. Like a sponge, he has to constantly absorb knowledge through reading, industry networking, and learning from varied sources like the Internet, experts, training, conferences etc. A well-developed curiosity enables a leader to seek out knowledge, and form connections between existing practices and new insights. He needs to specifically focus on understanding the implications of the changes and new ways of working on his functional area or business.  This helps him create a path forward to navigate the change successfully. 

Let us take the example of driverless cars which use AI to function. These cars are going through a testing phase and could be a reality on the roads in some time. How should the leader at a cab company respond to this possibility? His company owns many cars and employs many drivers/chauffeurs. The most important thing is to be aware of the invention of driverless cars. Unfortunately, there could be some leaders in the cab operation space who may be unaware of this advancement, and they will continue with business as usual. But, there will be some whose curiosity is fuelling their awareness. They will be seeking answers to questions like – How do driverless cars work? Will there be new opportunities with their coming? How soon will driverless cars become a reality? What would their cost structure be? Will customers like driverless cars? How will I adapt my business to driverless cars when it actually does happen?

Leaders in every function and business need to be aware of the developments in AI overall, and specifically in their functional or business area. Leaders in the automobile industry need to be aware of the market disrupting potential of driverless cars. Leaders in healthcare need to be aware of the potential of AI in disease prediction. Marketing leaders need to be aware of the rich customer insights created by applying AI to data. They need to think through the opportunities created by these insights, and then formulate an optimal marketing strategy with the adoption of AI. HR leaders need to think of AI-based predictive analytics, and how that will strengthen their decision-making processes. 

Leaders, along with their teams need to go through immersive learning experiences in AI, to gain an understanding of AI and its implications. Such immersive learning will trigger conversations within the organization on how AI can be applied to further the business. A leader who has a strong awareness of the ways in which AI impacts his business or function is already a few steps ahead in coping with change, compared to another leader whose antennae are not sharply tuned.

Disciplined adoption and abandonment 

AI may prompt adoption of new practices and abandonment of old practices. Both of these involve change, and human beings are usually resistant to change. We like to hold on to familiar and established ways of doing things. The first step is to identify which processes, practices or ways of working need to change. One needs to avoid the temptation of a herd mentality and hop onto the AI bandwagon, simply because everyone is doing so. This requires a detailed and thoughtful understanding of how adopting a new practice or abandoning an old one will impact the organization. It is important to create a business case for the proposed change outlining the clear benefits along with potential risks. Systems thinking approach – understanding the interrelationships between all the moving parts is critical when making changes. It’s important to understand that if practice A is adopted or abandoned, how it will impact practice B, outcome C, and department D. 

For e.g., a call center decides to switch to chatbots for certain basic queries and assign only the more complex queries to human operators. Chatbots run a security risk, it’s possible that hackers may impersonate a chatbot, and the user may reveal sensitive information to it. Systems thinking approach will require leaders to think how security is impacted due to the switchover to chatbots. Will they need greater investments in security, and how will that impact their budgets and other priorities? Will they need to bring in people with advanced chatbot security knowledge and skills? Or can they upgrade the existing skills of their staff to cope with this challenge? Will it make some call center operators redundant? Can they be redeployed or reskilled? 

It’s important to have such a logical chain of thinking, which progressively frames questions around the multiple ripple effects of each action, and seeks answers to them. The answers then may fuel more questions, leading to greater clarity into the implications of an action. This is what is meant by “disciplined” adoption or abandonment – it is done only after a very robust and thorough thought process, versus one which is frenzied and haphazard. 

Compassionate foresight and people element

The “people element” is the most complicated one as it impacts human lives. Do leaders have to grapple with questions like - Which skills will not be needed anymore? Which business unit or department could be redundant going forward? And the most painful one - Will people need to be let go?

An aware and compassionate leader will want to leverage the opportunities, as well as try to minimize the adverse impact on people. This is a very tricky balance to achieve, needing a lot of foresight. And, it needs to be compassionate foresight. It doesn’t mean that decisions about letting people go will not be taken. It means that a leader with compassionate foresight gives a lot of importance to people-related decisions. He keeps himself aware of possible changes, which may be far in the distance now, but could impact people when they actually take place. His foresight helps him evaluate the possible consequences of the impending change, and it also gives him time to change course, or come up with creative solutions before the change is on his head, forcing him to act. 

Continuing with the cab operator example, he would start seeking answers to questions like - What about all the drivers and chauffeurs on my rolls? Can I reskill my drivers to manage the operation of driverless cars? Do I need to reduce the hiring of new drivers? My business fulfills the customer need for transportation, but are there other value-added services which customers will be willing to pay for while using driverless cars? Could I segment my customers into those needing only transportation, and those needing an enjoyable experience? He may think of airlines which fundamentally provide transportation, but they also provide enjoyable experiences through their in-cabin services. Could he reskill his drivers to provide some value-added services?

It is possible that even after a lot of compassionate foresight and creative problem solving, there may still be some adverse impact on people. But, it maybe lesser than the impact in situations where leaders did not plan in advance for the coming changes. 

Leaders, therefore, need to take a deep look at their business, understand how AI will impact them, and then work in a disciplined way to get the benefits of AI, while reducing the adverse impact on people.