Navigating an AI-enabled business landscape

Boards must balance innovation with risk management to guide their organizations confidently through the AI landscape.

- LEE CARLO B. ABADIA

Artificial intelligence (AI) presents both opportunities and challenges for organizations.

While there is pressure to adopt AI quickly to stay competitive, risks and capability gaps can hinder swift action. This article explores how boards can confidently guide their organizations through the AI landscape, focusing on building confidence, creating value, and augmenting human potential.

THE AI DILEMMA

AI's breakthrough capabilities have generated significant excitement and investment. According to the EY CEO Imperative Survey, driven by concerns of falling behind, 99% of CEOs are investing in generative AI through initiatives such as establishing an AI task force with a direct line to the C-Suite, determining which data will create a competitive advantage through AI, and investing in capabilities to augment third-party AI with proprietary data. Meanwhile, 70% believe immediate action is necessary to prevent competitors from gaining a strategic edge. Despite this urgency, organizations face challenges such as legal and cybersecurity risks as well as difficulties in sourcing top tech talent.

Boards play a crucial role in navigating these challenges, balancing legal and regulatory compliance with strategic and technological innovation. This dual responsibility can create conflicting priorities, making it essential for boards to find a way to manage both effectively.

On the other hand, many investors remain motivated by the desire to deliver short-term returns. Some investors may not push for change if they believe they are sufficiently diversified at a portfolio level. This leads to a focus on maximizing value through current business models rather than transitioning to new, sustainable ones.

ESTABLISHING TRUST IN AI