3 minute read 26 Apr 2018
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What smart speakers can teach board members about adopting AI

By

Sharon Sutherland

EY Global Center for Board Matters Leader and EY Global Markets Strategy and Operations Leader

Global mindset. Power through diversity. Art lover. Intellectually curious. Traveler. Legacy matters. Passionate about learning initiatives.

3 minute read 26 Apr 2018

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Board members don’t need to be AI experts, but they do need to know the questions to ask about its impact on their business.

When I purchased my smart speaker back in 2014, a colleague and I were keen to test how “intelligent” its personal assistant functionality really was. So we asked it a series of related questions about one of my favorite actors, Cate Blanchett. And while we found that it had no trouble with direct questions such as “How old is Cate Blanchett?” and “Where was she born?” (Australia, of course), it couldn’t tell us how old she’d be in 2020.

Such are the present limitations of commercially available consumer-facing artificial intelligence (AI) assistants. Currently these assistants are capable, based on a verbal request, of translating, interpreting and mining structured data. But they still lack the ability to truly “think.” So for now at least, artificial intelligence plus human intelligence equals optimal performance.

Testing the limits of AI technologies

This is a critical issue for organizations to recognize, understand and balance. AI has the potential to make them more efficient. It could also support better decision-making based on big data and the targeting of services and offerings to better align with their customer base.

But to make the most of these opportunities — and more pointedly, to mitigate the associated risks — organizations need to understand the boundaries and limitations of the AI technologies they adopt. And it’s the board’s responsibility to ensure they do it.

The challenge for boards is therefore to make sure they ask the right questions of management. 

Asking better questions about AI

It’s understandable that advances in technologies such as AI take board members out of their comfort zone. Quite frankly, the complexity and pace of change involved presents challenges to the majority of people. 

But with AI set to become even more prevalent both personally and professionally, it’s crucial that board members become better versed in how it could affect the organization’s strategy, talent agenda and the way it manages risk. While AI can be used to create sophisticated tools to monitor and analyze behavior and activities in real-time, it also presents risks to be managed. Typical risks include poor-quality training data and programming issues, as well as external pressures such as data privacy regulations and meeting customers’ expectations.

This means asking better questions about the myriad of ways AI may disrupt their business. These could include:

  • Do we, the board, understand the potential impact of AI on our business model, culture, strategy and industry? And do we understand it well enough to control or trust the outcomes?
  • How are we challenging management to respond to both the opportunities and the risks it presents? Who benefits from (or pays for) the outcomes?
  • What are the ethical consequences of failing to prevent algorithmic bias?
  • How are we using AI for governance and risk management? How might it affect the integrity of our finance function or financial statements?
  • Do we have a strategy for recruiting and keeping people with the skills needed to manage AI-related projects? And how will we monitor the impacts of those projects?

Embracing innovation doesn’t mean being irresponsible

I’m not suggesting that caution should rule the corporate roost. On the contrary, it’s important for organizations to take risks and invest in the disruption agenda.

It may be unknown territory, but being bold and embracing innovation like AI shouldn’t be daunting. The role of the board is to help provide perspective and ensure the right questions are being asked to prevent boldness from becoming carelessness. Otherwise they risk neglecting their core responsibilities of oversight, corporate governance and accountability.

EY’s latest report, When boards look to AI, what should they see? provides insights for board’s to consider for their organizations as they navigate AI. Find it at ey.com/boardmatters.

Summary

When it comes to AI, boards need to help provide perspective and ensure the right questions are being asked to prevent boldness from becoming carelessness.

About this article

By

Sharon Sutherland

EY Global Center for Board Matters Leader and EY Global Markets Strategy and Operations Leader

Global mindset. Power through diversity. Art lover. Intellectually curious. Traveler. Legacy matters. Passionate about learning initiatives.