SECOND OF THREE POSTS BASED ON NACD PROGRAM ON BOARDS AND COMPANIES IN TODAY’S ECONOMY
AI requires boards to act differently. What exactly does AI accomplish for your particular business? Boards need strong intelligence on AI, within boards or by consultants. AI will permit boards to effect operational changes and to analyze effects of change in production equipment, software, sales and the like. There will be a big shift to data processing use of AI.
AI in a company should not be presented as an experiment; that raises concerns that people will be replaced. AI should be presented as a tool to be used by persons within the company. Risk: “Everyone is excited to use AI to eliminate somebody else’s job.” Frame AI internally as a “business enabler” and not a labor replacement.
Deployment of AI must be done with great care to protect company proprietary information or it will be scooped up, read and end up public through being read and used in AI information bases.
In US industry, many manufacturing tasks are being done by older workers. Younger people are not learning these skills; a big problem. But some of these skills in the future will be performed differently; workers need to be trained to use AI to ultimately replace older working cadres. New laborers will more and more use AI to fill the gap in staffing jobs given shortfall in the size of the US labor force (see first post in this series).
While companies should develop AI for use by the new generation of workers who should see it as a tool, companies must confront the fact that some jobs, involving moving or analyzing that which is on paper, will indeed disappear.
Some countries are facing demographic atrophy, falling birth rates, aging overall population. Any country in that position will find that AI will assist in maintaining industry; the paper side of operations will lose people who will be available for working in production in the new modality of using AI to supervise actual production.
The personal fear/backlash of the labor forces to the coming of AI may prove to be more acute in Europe, where worker councils are powerfully entrenched; progress there may be slowed thereby.
Boards should “think big” about AI, see what businesses in other industries are doing with AI, conceptualize broad use of AI in thinking about industrial production.
One panelist noted that, over the past two decades, his large US company tended to hire its intellectual workforce from outside the United States, as they found adequate skill sets in people whose salary structure was lower. Will AI properly used in the US reverse that practice? Will immigration policy assist in that process?
One panelist noted that in making announcements about projected business they did not include any possible improvements driven by AI. Under questioning as to why that approach made sense given the power of AI, the reply was that the company used at this point an “auditability standard”–if you cannot see it you should not predict it. AI is used to understand current data but not used to predict profit from future deployment. There was one panelist who questioned whether that approach was logical when being asked about your future prospects.
The discussion of AI often returned to how AI would shape the future work-force and how to ease those workplace displacements that would occur; in the future AI will be processing paper and actual production will be done by human beings who will spend time monitoring data and electronics that run on AI, rather than standing on the production floor and working with their hands. Younger people need to be trained by schooling and internship to understand how they thus can add value by use of AI.