Leadership in the Age of AI

In 2017, I published an article in the Journal of Management Inquiry entitled “The Future of Management in a World of Electronic Brains.” In it, I analyzed which areas of management might be most affected by artificial intelligence (AI). I postulated that AI would primarily impact tasks related to data analytics and planning (finance, production, or supply chain). Conversely, tasks related to strategy, creativity, and innovation (at the beginning of the value chain), as well as those related to customer interaction (at the end of the value chain), would be the least affected. I was wrong. The emergence of generative AI has shown that it can also perform intuitive and creative tasks. In fact, it seems even more suited to these than to purely analytical work.

In their book The Age of AI , Eric Schmidt (former CEO of Google) and Henry Kissinger (former US Secretary of State) state that “AI is not only capable of processing data more quickly, but it also detects aspects of reality that humans do not perceive, or perhaps are not capable of perceiving.” When Lee Sedol, 18-time world go champion, was defeated by an artificial neural network developed by DeepMind (now Google's AI unit), he was facing a non-human intelligence, which defeated him with a disruptive move. Go, an oriental strategy game, is not played by rational planning, as is the case with chess, but by strategic intuition. In chess, we plan (“if I move my rook, they will attack me with my pawn, and I will counterattack with my knight…”). In go, the array of pieces is so vast that, with each move, the opponent can react with hundreds of possibilities. According to mathematicians, the total number of possible variations in a game exceeds the number of atoms in the universe. Go players don't plan; they sense where the game's center of gravity is shifting and adapt dynamically to the game. They flow similarly to how we drive a car: instinctively, with a blank mind.

Can machines develop instinct? Instinct is the crystallization of experience: an expert recognizes patterns almost unconsciously and acts accordingly. If Lee Sedol had played, say, 10,000 games in his lifetime to reach the top of the world, a machine can play 10 billion games at the speed of light against itself, exploring and learning strategies never before seen by humans, and developing unprecedented and surprising techniques. Therefore, AI "sees" reality, surpassing human perception.

'AI-First' Google is changing the game in management with its 'AI-First' approach: from "structure follows strategy" to "strategy follows technology."

How will managers coexist with machines equipped with these capabilities? How will they navigate a context saturated with systems that will not only process more data and more efficiently, but also interpret and connect it in more creative and original ways? How will they lead in an environment where AI will propose new strategies, R&D paths, market hypotheses, innovative products, or customer interactions? What skills will these managers need to coexist with AI?

First, just as now, they will require strategic thinking. Leaders will need to have a holistic view of the organization: understanding it as a system, as a cohesive social network made up of people organized to achieve common goals. They will need to understand the interactions between the different areas of the company and make them work as an integrated whole. They will formulate strategy as a differential value proposition and execute it as a coherent and consistent plan.

But these leaders will operate in highly technological environments. They will need scientific thinking and an understanding of technology. They must master and apply the scientific method to validate market hypotheses, develop algorithmic thinking, value the importance of data, and understand the transformative potential of disruptive technologies. Companies will be reconfigured around digital cores of AI and data. When Google declares it will be AI-First , it is changing the rules of the management game. Until now, we followed Alfred Chandler's (MIT) famous premise: "Structure follows strategy." All tactical decisions regarding investment, growth, borrowing, or hiring had to be aligned with a strategic plan. Today, strategy increasingly follows technology. Whether or not certain technological capabilities are available will enable (or impede) the development of new strategies. Technology is thus becoming an essential area of ​​management , on a par with marketing or finance. Companies will seek managers capable of harnessing the potential of AI. AI won't replace them, but those who don't know how to use it will be replaced by those who do, according to MIT experts.

Ethics An AI will not assume social, economic, or criminal responsibility for its suggestions; that is the leader's job.

Finally, managers will need large doses of philosophical and humanistic thinking. In an environment where AI can generate diagnoses based on intuitions (not always explainable), humans will not only have to ask the right questions, but also understand why the AI ​​responds in certain ways and interpret the machine's logic from a human perspective. We will coexist with digital systems with increasingly humanized interfaces, capable of producing complex reasoning and suggestions. Furthermore, we will face profound ethical dilemmas. Decisions that decisively affect people will be mediated by AI systems. Therefore, leaders will have to ask themselves what is right or what is fair. And, above all, they must build solid codes of values. Because machines will diagnose, propose ideas, and suggest innovative solutions, but the ultimate responsibility for transforming these diagnoses into concrete actions will remain human. An AI will not assume social, economic, or criminal responsibility for its recommendations. That accountability will remain in the hands of the leader. And, perhaps, it will constitute the last bastion of human management .