Introduction
Generative artificial intelligence (generative AI) represents one of the most transformative technologies of our time. Boards play a crucial role in guiding the adoption of this technology in companies, balancing innovation and risk management.
The Power of Generative AI
Generative AI, based on deep learning models trained on vast unstructured datasets, has the potential to increase efficiency, reduce costs and generate new growth. These models can classify, edit, summarize, answer questions and create new content, facilitating the implementation of multiple business applications.
The challenge for business leaders
Given the speed of development and adoption of this technology, it is critical to understand how to unlock its value while simultaneously managing the associated risks. We will do this through 4 key questions:
- Are you evaluating the Impact of Generative AI on your business?: Companies need to consider how generative AI will affect their industry and operations. Initial applications of generative AI are expected mainly in software engineering, marketing, customer service, and product development.
- Are you considering the balance between value creation and risk management?: Balancing innovation with caution is essential. Generative AI presents risks related to privacy, ethics, and security. Companies need to understand the value and risks of each use case, aligning with the company’s risk tolerance.
- Are you organizing hierarchically?: Companies should take a coordinated approach to implementing generative AI and avoid getting stuck in experimental mode. It is advisable to appoint a senior executive to oversee and control all generative AI activities.
- Have you made a list of needs?: Companies need to assess their organizational capabilities in terms of technology, talent and organizational culture. It is essential to have a modern data and technology architecture, specific skills and a corporate culture that fosters innovation and learning.
- Extra – update your board: Board members need to ask themselves if they are equipped to provide the support needed. Adjustments in board composition, training on generative AI concepts, and incorporation of generative AI into board work processes may be needed. Only by starting from the top can we bring culture on these issues to all levels of the company.
All types of businesses will find value in AI. AI use has matured, moving from manufacturing and risk management to marketing and sales, product and service development, and corporate strategy and finance, according to research (link) conducted by Alex Singla global leader of QuantumBlack, AI by McKinsey. Organizations that make larger investments in AI, scale faster and recruit and train top AI talent are finding a competitive advantage over those that do not. However, most organizations are currently only experimenting with AI.
Conclusion
Conclusion
Boards of directors are responsible for guiding companies into the generative AI era, balancing innovation and risk appetite. The questions proposed in the article are a starting point for understanding and effectively managing this powerful technology.
For more information on how Boosha AI can help your company harness the power of artificial intelligence, contact us at info@boosha.it.