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Why Artificial Intelligence Wont Replace CEOs

An MBAs instinct is increasingly vital in the age of information overload
Peter Drucker was prescient about most things, but the computer wasnt one of them.
"The computer ... is a moron, the management guru asserted in a McKinsey Quarterly
article in 1967, calling the devices that now power our economy and our daily lives
the dumbest tool we have ever had.
Drucker was hardly alone in underestimating the unfathomable pace of change in
digital technologies and artificial intelligence (AI). AI builds on the
computational power of vast neural networks sifting through massive digital data
sets or big data to achieve outcomes analogous, often superior, to those produced
by human learning and decision-making. Careers as varied as advertising, financial
services, medicine, journalism, agriculture, national defense, environmental
sciences, and the creative arts are being transformed by AI.
Computer algorithms gather and analyze thousands of data points, synthesize the
information, identify previously undetected patterns and create meaningful
outputswhether a disease treatment, a face match in a city of millions, a
marketing campaign, new transportation routes, a crop harvesting program, a
machine-generated news story, a poem, painting, or musical stanzafaster than a
human can pour a cup of coffee.
A recent McKinsey study suggests that 45 percent of all on-the-job activities can
be automated by deploying AI. That includes file clerks whose jobs can become 80
percent automated, or CEOs jobs that can be 20 percent automated because AI
systems radically simplify and target CEOs reading of reports, risk detection, or
pattern recognition.
AI has been one of those long-hyped technologies that hasnt transformed our whole
world yet, but will. Now that AI appears ready for prime time, there is
consternation, even among technologists, about the unbridled power that machines
may have over human decision-making. Elon Musk has called AI "our biggest
existential threat, echoing Bill Joys 2000 warning in Wired magazine that the
future doesnt need us. On the other side, of course, are enthusiasts eager for
smart machines to improve our lives and the health of the planet.
Im on the side of Microsoft CEO Satya Nadella who says that we should be preparing
for the promise of ever smarter machines as partners to human decision-making,
focusing on the proper role, and limitations, of AI tools. For business school
educators like me who believe the future will indeed need us, the expanding power
of AI or deep learning poses a challenge and opportunity: How do we prepare
students for the coming decades so that they embrace the power of AI, and
understand its advantages for management and leadership in the future?
It would be a mistake to force every MBA graduate to become a data scientist. The
challenge for business schools is to update our broadly focused curricula while
giving our MBAs a greater familiarity and comfort level with data analytics.
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Tomorrows CEOs will need a better sense of what increasingly abundant and complex
data sets within organizations can, and cannot, answer.
The sophistication and volume of data may be increasing, but history affords models
of a decision makers proper relationship to data analytics.
Take D-Day. General Dwight D. Eisenhower sought as much data as possible to inform
his decision on when to land hundreds of thousands of Allied forces on the beaches
of Normandy in that fateful late spring of 1944. As Antony Beevors book on the
battle and other accounts make clear, Eisenhower especially craved reliable
meteorological data, back when weather forecasting was in its infancy. The general
cultivated Dr. James Stagg, his chief meteorologist, and became adept not just at
analyzing Staggs reports, but also at reading Staggs own level of confidence in
any report.
For months before the fateful decision to embark upon the Great Crusade,
Eisenhower developed a keen appreciation for what meteorological forecasts could
and could not deliver. In the end, as history knows, Stagg convinced him to
postpone the invasion to June 6 from June 5, when the predicted storm raged over
the English Channel and when many others questioned Staggs call that it would soon
clear.
No one would argue that Eisenhower should have become an expert meteorologist
himself. His job was to oversee and coordinate all aspects of the campaign by
collecting pertinent information, and assessing the quality and utility of that
information to increase the invasions probability of success. Today, big data and
the advent of AI expand the information available to corporate decision-makers.
However, the role of a CEO in relation to data echoes the absorptive and judgmental
function exercised by General Eisenhower in reading probabilities into his
meteorologists weather reports.
Its noteworthy that today, amidst all the talk of technological complexity and
specialization across so much of corporate America, a Deloitte report prepared for
our school found that employers looking to hire MBA graduates value prospective
employees soft skills more than any others. They want to hire people with
cultural competence and stronger communication skills, who can work collaboratively
in diverse teams, and be flexible in adapting continuously to new opportunities and
circumstances in the workplace and market.
This isnt just about intolerance for jerks in the office. Its about a leaders
need to be able to synthesize, negotiate, and arbitrate between competing and
conflicting environments, experts and data. If there was once a time when corporate
leaders were paid to make gut check calls even when essential information was
lacking, todays CEOs will increasingly have to make tough, interpretive judgment
calls (a different type of gut check) in the face of excessive, often
conflicting, information.
Those in the driver seat of institutions have access to an expanding universe of
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empirically derived insights about widely varying phenomena, such as optimal models
for unloading ships in the worlds busiest ports in various weather conditions,
parameters of loyalty programs that generate the stickiest customer response, or
talent selection models that yield both the most successful, and diverse,
employment pools.
Corporate leaders will need to be discerning in their use of AI tools. They must
judge the source of the data streams before them, ascertain their validity and
reliability, detect less than obvious patterns in the data, probe the remaining
what ifs they present, and ultimately make inferences and judgment calls that are
more informed, nuanced around context, valid, and useful because they are improved
by intelligent machines. Flawed judgments built on flawed or misinterpreted data
could be even more harmful than uninformed flawed judgments because of the illusion
of quasi-scientific authority resulting from the aura of data.
As a project management tool, AI might prescribe optimal work routines for
different types of employees, but it wont have the sensitivity to translate these
needs into nuanced choices of one organizational outcome (e.g., equity in employee
assignments) over another (family values). AI might pinpoint the best location for
a new restaurant or power plant, but it will be limited in mapping the political
and social networks that need to be engaged to bring the new venture to life.
Machines also lack whimsy. Adtech programs have replaced human ad buyers, but the
ability to create puns or design campaigns that pull at our heartstrings will
remain innately human, at least for the foreseeable future.
A new level of questioning and integrative thinking is required among MBA
graduates. As educators we must foster learning approaches that develop these
skillsby teaching keen data management and inferential skills, developing advanced
data simulations, and practicing how to probe and question the yet unknown.
In parallel to the ascendancy of machine power, the importance of emotional
intelligence, or EQ, looms larger than ever to preserve the human connectivity of
organizations and communities. While machines are expected to advance to the point
of reading and interpreting emotions, they wont have the capacity to inspire
followers, the wisdom to make ethical judgments, or the savvy to make connections.
Thats still all on us.

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