It might be late at night. Or it might be at the break of dawn. No matter what the time of day is, everywhere across the vast business landscape of there are CEOs pondering the future for their companies.
Their thoughts may be weighed down with worries about the competition. Or the cost of capital. Or regulatory issues. Or a thousand other critical matters. But no matter what the immediate issues might be, there is one common question looming above all the others. And it is a fundamentally strategic, existential question:
“How do I ensure that my company will keep up with the massive disruption and differentiation that consumers demand every single day?”
There are many forces that are driving fundamental changes in how consumers select and purchase goods and services. They are impacting production processes, shipping, marketing, customer insights, government regulation, and a host of other essential elements of business success today.
First and foremost, among these forces is Artificial intelligence. AI is embedding rapidly in every aspect of modern life, and it is rooting itself deeply into businesses of every size and category. So, with all due respect to that CEO—he or she, carrying the heavy burdens of responsibility for their enterprise—the real question that the modern business leader must ask is:
“How do I ensure that I am keeping up with the critical developments that AI is bringing to my business, my customers, my employees, my shareholders…my world?”
It is a daunting question. One that is increasingly being asked in CEO offices and boardrooms around the world. The traditional purveyors of CEO and Board wisdom – the large strategic and IT consulting firms have no answers to this question as they were equally under prepared for this tsunami.
In an earlier time–a mere 20 years or so ago—the key questions for businesses were: do we have the best IT strategy and implementation? Are we up-to-date with our hardware and software systems? Through digital technology, are we staying abreast of changing consumer attitudes and behaviors? Is our new product development process delivering successful innovations that are gaining new customers and building market share? How do we know if our marketing efforts are meriting our investment? The phrase, “the more things change, the more they remain the same” applies here.
In the 21st century, the challenges are similar in many respects. But they are also fundamentally different in other, critically important ways. And it is those differences that will increasingly spell the difference between success and stagnation for many businesses, and their CEOs.
AI is the seismic force at work. Going forward, with unstoppable momentum and global impact, AI technologies and methodologies will draw a critical line across the business landscape. Those companies that pass the line and accelerate ahead—driven by AI in all its many forms—will win the rewards of success. Those that fall short will fall behind ever faster.
So for the modern CEO, acquiring and sustaining the critical knowledge of AI that will be necessary to lead their company successfully is fast becoming a survival skill. Boards of directors, customers, vendors, employees, and stock markets will all increasingly assess CEOs on that skill set.
“But I don’t have time to study a whole new technology and master all the elements of it,” the cry arises from countless corner offices across the land. “I already have too much to do, and too little time to do it. How am I supposed to lead my company into that future when I don’t really understand all that AI entails, much less know how to apply and measure it effectively?”
Here are 5 Actions for a CEO to execute on:
Action 1: The first is having a coherent and comprehensive AI Strategy. Not a “blue book” filled with charts and visions, but a concrete executional strategy that looks at the 15 Core Functional Areas of an Enterprise – its Taxonomic model and looks to see where AI naturally adds value. The very models used for Business Process Re-engineering must now be pulled out of the shelves to look for AI integration. Instead of boiling the ocean, this more measured approach of takes into account what the primary needs and challenges for the business are today, and what they may be in the future. This is absolutely a Board and CEO-level responsibility. It cannot and should not be delegated down the line. The investment involved—not so much financial as it is strategic in terms of overall corporate mission, marketplace positioning, and competitive initiatives—requires real leadership to be most impactful and ROI-worthy. I advocate for having a Board member with prime responsibility for leading the development of that AI strategy, and overseeing its implementation on behalf of the Board.
Action 2: The second is AI Execution with Self-generated Momentum. This is the simple is done first to succeed and build momentum within the enterprise. There is a graded approach to AI implementation – Notifications, Alerts, Augmented Decision Making, Self-Driving and then Personalization. This gradual execution strategy allows for enterprise to build experience and expertise and systematically attempt to do the more complex. Simply slapping AI-driven systems at will onto existing corporate architecture in the hopes that somehow they will all work–independently, or together–effectively is a formula for failure.
Action 3: The third important action is Third party Audit of Rule Engines in the Enterprise. Just as with today’s suites of different business software applications, adopting the correct AI/ML systems and resources is key to short and long-term enterprise success. Be it the AI based rule engines that determine who gets a loan or not, or determines what the plane should do when the angle of attack sensor determines there is an imminent stall, there are many rule engines within the enterprise. These Rule Engines have been created by different teams, at different times, and for different reasons. Some of them may still be relevant and operational, and some of them may be irrelevant and still be operational. These are the hidden bombs that can blow and enterprise, and a career apart. Rigorous, periodic evaluation and certification of the Rule Engines is critical to success.
Action 4: The fourth action is an unrelenting focus on metrics that matter most – Extracting Category Busting Metrics. Is there a single number that differentiates products – like megapixels in a camera, a single number in every department that embeds the core for the success of a department. A gentle but long walk away from well-dressed but purely ornamental executive dashboards into a merciless boiling of all critical parameters into one or two numbers that encapsulate all the necessary meaning and information to drive action. The creation of executive dashboards has become a cottage industry with the aesthetics and craftmanship of jewelry artisans. It is currently fashionable for any executive office to have a wooden table, plush chair, and a big 50 inch monitor on the wall filled with metrics that have as much utility as a wall hanging. AI based category busting metrics are like a clock on the wall – a single number, but gets you moving.
Action 5: The fifth and perhaps the most important of all actions is the People Ecosystem. “Show me your friends, and I will tell you who you are”, is as true for an executive team and Board as it is true for everything in life. AI is not infused into an organization or a board just because the statisticians decided to relabel themselves as “Data Scientists”. The Board must comprise of at least some who have more than an anecdotal understanding of AI, but have demonstrated literacy in it. The organization may benefit from a Chief AI Officer – Dubai has a Minister for AI. Every function within the company must have someone whose specialization is AI explicitly. Every training and mentoring program in the enterprise must include an AI component. Every supplier to the company must have a contractual clause that enables them to provide AI services for the collection of waste and recycling to financial diligence and legal. Strategic consultants and creative agencies must have AI expertise as part of their teams. This insistence on AI expertise in the entirety of the People Ecosystem will bear rich dividends in both the short and the longer term. The future will belong to those whose daily working moments are harmonized with Artificial Intelligence at every turn.
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