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Artificial intelligence (AI) is rapidly transforming the business landscape, and that includes the role of boards. As AI becomes more pervasive and impactful, boards must have a deep understanding of how AI can impact their companies.
Here are five key principles that leading boards will need to embrace to effectively oversee AI initiatives:
Recognize data as a fundamental competitive asset
All AI models are based on data, so your proprietary first-party data is pure gold. It enables you to better prioritize customers, spot triggers for follow-up, and personalize how you interact with them. Capture and integrate data about your customers, likely by integrating data about them from across the enterprise, and create new data as you test innovations.
Own AI strategy, implementation, and risk at the board level
AI touches so many aspects of the business, so it’s critical to have a unified AI strategy across the organization. The board should own this strategy and oversee its implementation. This includes setting clear goals, defining KPIs, and holding management accountable for achieving the desired outcomes.
Be proactive about workforce strategy and talent needs
AI is fundamentally transforming workforce models, so boards need to be proactive about how to adapt their talent strategies. This includes reskilling and upskilling existing employees, sourcing and acquiring new talent, and adopting ethical and responsible AI practices.
Aim to shape your industry ecosystem
Integrating AI into your enterprise requires strategic decisions about what to build and what to buy. Most companies will need to tap into large tech vendors for infrastructure, talent, and expertise. Boards should play an active role in shaping the industry ecosystem and ensuring that their company is partnering with the right players.
Push for transformative and measurable impact
Boards should push for ambitious AI initiatives that can drive real business value. This may include reshaping the business’ value proposition, accelerating innovation, improving customer acquisition, and enhancing operational efficiency.
AI is a game-changer for businesses, and that includes boards. Boards that embrace AI and develop the necessary skills and knowledge will be well-positioned to lead their companies into the future.
Here are some additional tips for boards to get started with AI:
- Educate yourselves on AI: Attend conferences, read books and articles, and engage with AI experts to gain a deeper understanding of the technology.
- Form an AI committee: Appoint a committee of board members with expertise in AI to oversee the company’s AI strategy and implementation.
- Set AI-related goals and objectives: Include AI-related goals and objectives in the company’s overall strategic plan.
- Measure and track AI progress: Regularly monitor the company’s progress in implementing and using AI and track the results of AI initiatives.
- Incorporate AI into boardroom discussions: Regularly discuss AI-related issues and opportunities at board meetings.
By taking these steps, boards can ensure that their companies are well-positioned to harness the power of AI and thrive in the future.
In addition, here are some specific questions that boards should be asking about AI:
- What is the company’s overall AI strategy?
- What are the company’s specific goals for using AI?
- What risks are associated with AI?
- How will the company manage these risks?
- How will the company ensure that AI is used ethically and responsibly?
- What are the company’s plans for developing and retaining AI talent?
- How will the company measure the impact of AI initiatives?
By asking these questions, boards can ensure that they are fully informed about the company’s AI initiatives and that they are taking the necessary steps to mitigate risk and maximize the potential benefits of AI.
AI is a powerful technology that can revolutionize the way businesses operate. Boards that take the time to understand AI and its potential can help their companies seize the opportunities that AI offers and become leaders in the digital age.
