AI Managers Overview – Opportunities & Challenges

As AI changes the competitive landscape and upends operations in several business functions, it is important to evaluate the specific opportunities and challenges it leads to from a manager’s perspective.


Artificial Intelligence has developed enough in the last few years to offer applications beyond relatively simple tasks. But a general AI system, which can solve many types of problems and is self-aware, is still not available. Even within the scope of narrow AI, where machines use abilities like deep learning and natural language processing to solve very specific problems, what new developments mean from a manager’s perspective are slightly different from what they do for a general user. The business aspect of AI can be considered with the help of three important questions:

1.     What is AI?

As computers lowered the cost of arithmetic, AI has the ability to lower prediction costs, i.e. generating new insights from existing information. But, judgment will remain a human forte for now, e.g. AI predicts the best fit candidate for a job position, while a manager handles mentoring and taking ethical decisions. In view of this, not just managerial skill sets will have to adjust, but other changes will occur too.

2.     How will AI influence business strategy?

  • ·       Increasingly more complex prediction problems will be handed over to AI systems.
  • ·       Managers will have to train workers in judgment-related tasks.
  • ·       To properly time the shifting of workforce training, rate and direction of adoption of AI technologies will have to be continually assessed.
  • ·       Processes that combine the strengths of human workforce and AI will have to be developed.
  • ·       Strategic alliances to access effective data will have to be formed.

 

3.     What are the major management risks from AI?

  • ·       Replacement threat – Some jobs may no longer be necessary as reliance on AI systems grows.
  • ·       Dependence threat – Prediction dependence on algorithms could create new vulnerabilities and potential inefficiencies, especially if errors and biases creep into these algorithms.
  • ·       Security threat – Protecting sensitive corporate information will not just be an IT problem, but a responsibility of the management too.
  • ·       Privacy threat – As more data is collected from the labor force, new questions of autonomy and freedom will have to be addressed.
  • Conclusion

The net effects of the strategic implications of AI on management, along with related risks, are uncertain – what is certain is that AI will change business. Understanding this evolution will help managers be better prepared for the business world of tomorrow.


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