How CEOs can tap AI’s full potential

How CEOs can tap AI’s full potential

Embracing AI starts with the person at the top.

Article by PwC

CEOs must create a strategy for combining people and technology to change the way work gets done. The challenge is to understand the interactions between people and technology, and create a strategy for how the two can come together.

In April 2019, Stanley Black & Decker CEO James Loree presided over the opening of a 23,000-square-foot advanced manufacturing center and innovation incubator in Hartford, Connecticut, called ‘Manufactory 4.0.’ The facility pulls data streams from sensors embedded in manufacturing equipment across all of the company’s plants, allowing managers to pinpoint ways to increase efficiency.

The work taking place at the Manufactory is a significant step towards a future in which everything is digitally connected and people are empowered to make smarter decisions based on insights from artificial intelligence (AI) systems.

In this future, humans and robots will work together and new production methods will be tested, tweaked and implemented in record time. More broadly, the new facility works towards a goal Loree established when he took office in 2016: to integrate technology and innovation into everything the company does, turning a 200-year-old organization into, as the CEO puts it, “one of the world’s great innovation companies.”

AI, automation and complementary technologies already play a significant role in how companies function. Fully 54% of executives say that AI solutions have increased productivity in their businesses, and that number is certain to grow in the coming years. But contrary to many press reports, increased productivity does not necessarily result in lost jobs. As business operations become smarter, with more AI embedded in them, these tools will be used less to replace people and more to augment them.

Technology will help build human capabilities across a range of roles, functions and business units. For example, a chatbot can elevate a customer service request to a human agent to better serve the customer, an AI system can help product designers focus on the creative process by suggesting materials to use on the basis of certain parameters, and an assembly-line worker can use robotic arms to manipulate materials too heavy for a person to lift. Combining human and machine capabilities raises the stakes for CEOs. They must understand the interactions between people and technology and create a strategy for how the two can come together to change the way work gets done, in large part by giving people the tools and training they need to change the way they work—and convincing people that they need to work in new ways.

The sheer scope of change—in terms of both talent and technology—can be overwhelming. But CEOs can begin to develop this vision by focusing on five areas: understanding the full range of potential applications, clearly defining a vision for your company’s AI-enabled future, establishing a process to deploy AI, preparing your people to work differently, and deciding where you stand on the ethics of automation and AI.

CEOs can begin to develop this vision by focusing on five areas:

1) Discover the possibilities

Educate yourself on how technologies like AI and automation are likely to disrupt and improve critical aspects of your business. Develop a shared, base-level understanding among your executive team and board of directors about what AI and related technologies are capable of and how they can be integrated throughout the business. Bring in diverse perspectives and people who will ask questions and poke holes in assumptions.

2) Envision an AI-enabled future

The hype surrounding emerging applications can be so persuasive that companies are tempted to chase after them, launching pilot after pilot without a clear approach for scaling up successes, or tying initiatives to broader strategic goals. To avoid this trap, link specific applications to specific business problems.

Your vision could include:
• Boosting efficiency
• Improving the customer experience
• Creating new products and services
• Overhauling how certain services are delivered
• Enhancing or amplifying experts’ knowledge
• Automating repetitive tasks to free up employees to create value in new ways

3) Establish a process to deploy AI

Put a team in place led by the CIO or CTO, including data scientists, tech experts, operational managers and commercial leads. Sync with tech leads to develop a clear picture of development paths, including solution development, acquiring AI companies, licensing AI solutions, and forging partnerships. Establish decision-making authority, governance and other parameters that allow technology to be embedded across business units and functions. In thinking about data, identify where you want to create value, what data assets you already have, and which ones you need. Ensure that the right people have access to the right data when they need it. Emphasize that data-driven decision-making will become the new normal.

4) Prepare your people to work differently

CEOs need to harness employees’ intrinsic motivation to learn and take responsibility for upskilling and retraining their workforces. You can foster a culture of adaptability and lifelong learning that will be crucial to reaping the benefits of AI and related technologies. Change recruiting and training to make sure employees becomes AI-savvy enough to participate in conversations around automation and AI. In our CEO survey, 55% reported that a lack of key skills is inhibiting their ability to innovate.

5) Determine your stance on AI ethics

Because algorithms “learn” from historical data, some companies have launched bots that simply replicate ethnic stereo- types and bias-filled decisions made by humans. Build processes and train teams to look for biases in data and machine learning models. Integrate risk mitigation and ethical concerns from the start. Involve your board of directors—unintended consequences of AI could pose compliance risks and damage your brand.

CEOs will need to do their jobs differently to prepare for a future in which humans and technology work together to accomplish more than ever before

2020-03-09T19:18:09+00:00

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