AI in the Board Room
Our research team has investigated if AI is used in business by upper management, and we have concluded that a number of companies are beginning to utilize AI, either by the CEO of the company, or by upper management. The potential for AI in the boardroom is vast, and includes being able to improve strategic decision-making, review and process press releases, identify subtle changes in customer preferences, and administrative coordination and automate control tasks for management.
HOW AI CAN IMPROVE THE BOARDROOM
The potential of AI is currently high, and many tech companies are beginning to envision how AI can improve a company's upper management. One way AI can advance the way companies are run is to improve the way the Board of Directors handles making strategic decisions. The AI will track capital allocation patterns across the industry, highlight any potential concerns such as a decrease in company spending while competitors are increasing investment, and then bring it to upper management's attention.
Another way is for the AI to review and process press releases. AI would be able to scour through more press releases than a human being would be able to, and would be able to identify new competitors moving into key markets much faster. When these new competitors have been identified, the AI would be able to make suggestions to members of the board on which investments would protect market share to upper management or the Board of Directors.
AI will also be able to analyze internal communications and assess employee morale, which will help improve the operational decision-making done by a Board of Directors.
AI can easily pick up on subtle changes in customer preferences. Such changes could potentially have product or strategy implications for a company, and therefore it is imperative that these changes be identified quickly.
CEOS AND UPPER MANAGEMENT THAT UTILIZE ARTIFICIAL INTELLIGENCE
AI is already being used by upper management in companies. The CEO of Salesforce, Marc Benioff, uses an AI system called Einstein. Einstein scours through data to identify trends and patterns, evaluate performances of various markets, highlights key attention areas, and brings any important information to Benioff's attention.
Deep Knowledge Ventures, a Hong Kong-based venture capital firm, uses Vital. Deep Knowledge Ventures credited Vital with rescuing the company when it was on the brink of bankruptcy. Vital was able to identify which projects that the company was investing in would have a very high failure rate, and therefore they were able to avoid making too many risky investments.
Merck and Columbia Sportswear use an AI system called Aera. The AI system Aera can answer questions about revenue optimization, and can make suggestions such as shifting inventory from one territory to another.
Aera has predictive modeling capabilities, and can take action when needed, making it easier for companies to make crucial decisions much faster. The CEO of Aera, Fred Laluyaux, hopes that companies and their CEOs will move towards automating their decision-making.
Goldman Sachs started using AI in investing back in 2008. The AI is used to evaluate the profitability of a company, and determine whether a company's shares are undervalued. The AI has reportedly already processed over a million analyst reports and 26 million news reports.
THE FUTURE OF ARTIFICIAL INTELLIGENCE IN UPPER MANAGEMENT
A number of tech companies are beginning to research and develop AI that would change the way CEOs and the boardroom work. The World Economic forum predicted that the first AI to serve on a Board of Directors will happen by the year 2025.
Kensho Technologies provide next-generation investment analytics. They are currently designing a system that will allow investment managers or CEOs to ask investment-related questions in plain English. One of the questions that could potentially be asked is, "What sectors and industries perform best three months before and after a rake hike?" The AI will then be able to provide answers within minutes.
Tech companies will also develop AI that can simulate social skills and network the way CEOs and Board of Directors are able to.
Deloitte released a State of the State report, and in it they stated that networking with an AI boss is a future possibility. They determined that personal interaction on part of the CEO or higher management still face a 23% chance of automation.
There are a number of ways AI can improve how upper management or a Board of Directors work, such as reviewing and processing information that will lead to faster and more informed decision-making. The CEO of Salesforce, Marc Benioff, uses an AI system called Einstein to help automate various procedures in order to increase productivity. Tech companies are beginning to develop AI to improve the way CEOs and directors do their work, and the first AI to serve on a Board of Directors is expected to happen by the year 2025.