Create New Leaders ... Oust The Laggards

John Barrington addressed AIM WA's Professional Development Sundowner in October. The following article was published in the Australian Institute of Management WA Leader magazine.

Article by Chris Thurmott

Artificial intelligence (AI) is quite literally all around us. It is in our phones, it is in our homes and it has even entered the boardrooms of some extremely forward thinking and, in many respects, brave companies around the world.

It has become a key element in the way we live our lives and whether you like it or not, its influence over our lives will only increase at a frighteningly rapid rate of knots.

With AI’s influence over everyday life increasing with every passing day, Barrington Consulting Group Founder John Barrington said it was only natural companies were seeking to embrace the concept in their business strategy.

“They need to either get on-board with AI and start understanding it or risk missing what is a very fast moving train,” he said.

“Organisations and individuals that run from AI or think its application is many years away almost certainly will be left behind.

“AI will change organisational strategy as we know it, it will create new leaders and kill the laggards.”

Mr Barrington said a thriving start-up community here in Western Australia had embraced AI, making the state something of a world leader on the matter in some areas.

“There’s more than a dozen firms in Perth already using AI and more planning to use AI, so we’re well progressed down that path as a state,” he said.

“Woodside, for example, is the world leader in the oil and gas industry and its use of AI. “Its AI machines are able to analyse data in a matter of minutes that previously took months to analyse.”

What is AI?

In order to understand how AI can benefit a business, it is crucial to understand what AI actually is.

Mr Barrington described AI as a non-biological entity that could observe things in an environment and take action to affect that environment.

“The critical phrase there is take action,” he said.

“AI enables machines to respond on their own; previously programmers had to write all of the instructions. Now the machines learn.”

The real key to the success of AI is its ability to learn and learn rapidly. However, the true ability and learning capacity of AI is yet to truly be discovered.

An example of this is provided by the creation of AlphaGo by Deep Mind, a Google-owned AI lab. Go is a strategy game that has been played for about 3000 years and, despite humans having this vast experience and knowledge of the game, AlphaGo was able to defeat one of the greatest human Go players four games to one in a five-match series.

“Humanity has played Go for thousands of years, and yet AI has shown us we have not yet even scratched the surface. The union of human and computer players will usher in a new era, together man and AI can find the truth,” current top Go player Ke Jie said.

As the comment from Ke Jie suggests, this example is not about how AI is becoming better than humans; it is about how humans and AI can work together to create something far greater.

It is the amalgamation of humans and AI across a strategy, both being used for their strengths, that will have the greatest success.

“AI has the power to revolutionise business strategy because it is capable of computing things far quicker than any human could, but AI needs to be guided by human input,” Mr Barrington said.

Implementation and risks

To assist companies looking to implement AI into their strategies, Mr Barrington has put together a model called PRIMER, which puts forward the basic areas businesses need to think about when working with the technology.

One aspect of this model is about the resources involved; Mr Barrington said it was relatively cheap and easy to implement AI into a business, but there was one crucial resource that needed to be devoted to AI.

“Time,” he said.

“Time is definitely the most important resource you should devote to AI right now; boards and executives absolutely need to be devoting time to this.”

The final part of the PRIMER model refers to Reputation and this is an area where a portion of the time dedicated to AI should be placed.

“As a board you need to decide where the ‘creepy line’ in your organisation is. Ethics, in this instance, are profound because although there are many upsides, AI also comes with many risks,” Mr Barrington said.

“AI has been described as a far greater threat to humanity than nuclear warfare, so we must remain in control and that’s where boards must play a fundamental role in understanding the ethics for your organisation within the current environment.

“There are some substantial risks because the future of AI is a hard one to predict, but as long as humans remain in control, the potential benefits are massive.

“What is certain is that organisations both large and small need to move on and be thinking about AI now.”

PRIMER

Purpose – Identify the potential benefits that could come from an AI implementation.

Resources – Determine the resources that will be required to being using AI.

Insight – Scope the areas in which AI can be used to learn about different areas of your business.

Move – Exploit AI to drive organisational agility.

Experiment – Use AI to swiftly test market scenarios, customer expectations or in-house capabilities.

Reputation – Assess the governance and management implications.

7 questions directors must ask about AI

1.    What is it?

2.    What is our company’s perspective on how AI will disrupt our industry?

3.    Who are the global leaders in AI in our industry?

4.    What relevant global research is being undertaken that we can exploit?

5.    What is our plan to understand and develop strategies incorporating AI?

6.    Where could AI create the most significant, enduring advantage?

7.    What are our customers’ fundamental requirements that AI could address?