Artificial Intelligence can be a game-changer for decision making and reducing of human bias. In an event organised by the Financial Times at the Malta Chamber of Commerce, I spoke about how AI can transform corporate decision-making and create a new paradigm in the boardroom.
AI has evolved dramatically over the past decade, with advances in machine learning and data processing capabilities allowing AI systems to outperform humans in various domains. As Stuart Armstrong states in his book, “Smarter Than Us,” AI systems are “phenoenally, incomparably better than us,” and the edge we’ve lost will never be regained.
As the world faces growing global threats, it becomes essential for companies to build resilience by developing a deep understanding of technology. Two key principles underpin this resilience: pro-innovation (digital first) strategy and data-centric & data-aware approach. These principles enable companies and boards to adapt to changing conditions, withstand disruptions, and recover rapidly.
AI is shifting the balance of power in the corporate world, offering companies the opportunity to challenge conventional assumptions and reshape their relations. Incorporating AI in the boardroom can lead to true diversity in decision-making, providing new perspectives and reducing bias.
However despite the clear advantages that AI offers, many boards and non-executive directors lag behind in adopting AI technology. This reluctance stems from a focus on what has been done in the past rather than what lies ahead. Here are some novel opportunities to consider which support better corporate outcomes:
- Enhancing decision-making: AI can analyse vast amounts of data and identify patterns, trends, and insights that may not be evident to human board members, leading to better-informed decisions.
- Reducing bias: AI algorithms can help minimise human biases in decision-making by objectively evaluating data and providing impartial recommendations.
- Scenario planning and forecasting: AI can simulate various scenarios and predict potential outcomes, helping board members make strategic decisions based on data-driven insights.
- Identifying emerging trends: AI can monitor and analyse market trends and industry developments, allowing boards to stay ahead of the curve and capitalise on new opportunities.
- Risk assessment and mitigation: AI systems can assess and quantify risks, enabling boards to make proactive decisions to minimise potential threats and negative impacts.
- Improving efficiency: AI can automate routine tasks and processes, freeing up board members’ time to focus on strategic issues and high-level decision-making.
- Enhancing stakeholder communication: AI can analyse stakeholder sentiments and feedback, enabling boards to better understand and address concerns, ultimately improving stakeholder relations.
- Facilitating diverse perspectives: Incorporating AI in the boardroom can bring unique and diverse viewpoints to the table, leading to more inclusive and well-rounded decision-making processes.
- Monitoring performance and compliance: AI can track and analyse company performance metrics and ensure compliance with regulations, allowing boards to make data-driven decisions and adjustments as needed.
- Personalising board materials: AI can tailor board meeting materials and presentations to individual board members’ preferences and learning styles, making it easier for them to engage with the information and contribute to discussions.
As Robert Pirsing said in the book ‘Zen and the art of motorcycle maintenance‘: “If you run from technology, it will chase you.” It’s time to embrace the opportunity that AI presents and reflect on the role it should play in the boardroom. Board members must consider the potential impact of AI on corporate policies and regulations, the inevitability of AI in decision-making, liability ramifications, ethical choices, and whether AI should be subject to corporate law.
By doing so, companies can revolutionize their decision-making processes and create a new paradigm in the boardroom.