The introduction of ChatGPT in November 2022 has taken the world by storm and has triggered a boom in Generative AI (Gen AI) tools. Gen AI is on everyone's mind, prompting profound discussions on how business leaders and their organisations will be affected. For the first time in history, higher-wage knowledge workers will be heavily affected by this fourth industrial revolution spearheaded by digital technologies and AI. How will this affect business leaders?
The International Monetary Fund (IMF) has predicted that almost 40% of global employment will be exposed to AI and the number climbs to 60% in advanced economies due to their proportion of highly skilled jobs (IMF, 2024). White-collar occupations previously thought to be immune to displacement, such as managers, chief executives, and tech professionals, would now be most affected by AI (International Labour Organisation in Institute Global, 2024).
30% of hours worked today in the US could be automated by 2030, with some of the greatest displacements in STEM (science, technology, engineering and mathematics), including tech, software and engineering, business and legal professions as well as in management (McKinsey, 2023). The CTO AI from Cognizant estimates, that 9% of the US workforce could be displaced by the integration of AI (Babak Hodjat, 2024).
Asia possesses a unique labour-market and a pro-AI business landscape:
Artificial Intelligence (AI) is rapidly becoming a central force in shaping industries, economies, and societies around the world. As nations race to harness its potential, policymakers are grappling with the challenges of regulating this transformative technology. From the European Union's first-ever AI legal framework to Singapore’s ambitious strategy for expanding AI talent, countries are adopting different approaches to balance innovation with safety. Here are the most pressing AI policy trends to keep in mind:
The bottom line: People who have embraced artificial intelligence (AI) and technology will displace those who have not (Singapore’s Minister for Manpower Tan See Leng in Straits Times, 2024)
As governments around the world implement comprehensive AI policies, enterprises are also taking a proactive approach to governing AI usage within their organisations. From internal AI ethics boards to frameworks for responsible innovation, companies are balancing the pressure to innovate with the need to safeguard against potential risks. The strengthened AI governance points at the necessity of responsible AI deployment. It is a business imperative.
The role of the Chief Transformation Officer (CTO) is evolving accordingly. Once focused on digital shifts, CTOs now lead AI strategy, overseeing governance, ethics, and compliance to ensure businesses innovate within regulatory frameworks while staying competitive.
E.g. at MU, trainings are planned for all MU Experts in the coming year to use AI in a responsible way and according to regulations. MU's stance on using AI in selection emphasises responsible and ethical use while adhering to relevant laws, regulations, and internal standards. Employees are accountable for AI-generated outcomes and must ensure outputs are validated by MU Experts to mitigate bias. Personal and client data, along with intellectual property, should never be used in third-party AI services. Mandatory training on AI and emerging technology is required.
Every business leader will need to examine their organisations to determine the potential impact and the required changes. Generative AI alone affects 300 million jobs (CNBC, 2023) and generates up to $4.4 trillion (McKinsey, 2023) annually in new economic value worldwide, yet technology is taking a backseat in this discussion. AI is about a culture shift, so soft skills – communication, business agility, collaboration and prioritisation – will be the game changers.
A recent Mercuri Urval survey of over 100 executives, primarily from Germany, Switzerland, and the USA, offers key insights into how AI is being integrated into leadership roles. The majority of respondents (80%) believe that AI will complement but not replace traditional C-level roles such as CEOs, CFOs, and COOs. They see AI as a powerful tool for enhancing decision-making, optimising processes, and driving innovation, while human leadership remains essential. However, only a small portion (6%) predicts that some leadership positions could be replaced by AI, emphasising the need for leaders to have both traditional management skills and a deep understanding of AI technologies MU Study 2024
In the age of AI, leadership is no longer just about managing people; it's about managing change. Leaders must be adaptable, strategically agile, and empathetic. A culture of continuous learning and innovation is vital for ensuring that AI doesn’t just automate tasks but enhances human potential.
AI may be excellent at analysing data, but leadership requires emotional intelligence (EQ)—the ability to understand and manage human emotions. Leaders who balance AI’s capabilities with human empathy will be best positioned to lead in the AI era.
Pay attention to middle-ground predictions, and not the extremes: the truth is usually in this midway. By monitoring your business environment, you identify your competitors, signals and trends in your industry. This will help you to be agile and shift accordingly.
Wanyi Weng, Director at Singapore Government Data Office, believes that the AI hype is an opportunity for business leaders to take stock and get down to brass tacks:
Don’t be an ostrich. The people around you are already using Gen AI. Run any experiments quickly without overplanning for success. Launching agile teams that fail fast and learn are key to making progress. Celebrate failures and move on to the next experiment.
What about SMEs who do not have the affordances for a CTO and a full-fledged team of data scientists? Dr Andrew Seit: Take a short-term pilot approach: Forget the next one year, what are the things you can test immediately within 3-6 months? Don’t try to compete with the big firms, get the language right and start from there.
Actively review every job in the organisation, including your own. Jobs will definitely evolve in the next few years. So, it is best to be prepared. Ask yourself: “How can AI make this job better?” Start making changes and adaptations to jobs whenever applicable.
Charu Mahajan, Partner & APAC Leader for IBM, emphasised the importance of positioning your operating strategy at the heart of leadership considerations, citing questions that forward-looking leaders are already asking:
Every business leader needs to be active in reskilling their workforce. Don't just leave it to the HR department. As you redesign your jobs, you must also retrain your workforce. Opt for a "more and diverse" approach over a “less and narrow” one: This means diversifying the range of skills in your workforce through your experimentation.
Wanyi Weng: there are two fundamentals to remember: First, recognise that your workforce will be disrupted and that re-skilling is necessary. Secondly, identify what skill sets are needed now. Not just the technical skills to build and train models, but the soft skills to make sure that using AI brings value.
At the same time, Richard Jones: “Reassure your workforce that you are not replacing them, but embracing human connection within an AI-enabled business.”
When your business is ready, identify areas where you can deploy AI. Pilot, fail fast, learn and try again so that you can explore all the viable ways of integrating AI into your business. Take on the "Edison mindset": you can only find out the answers after trying and trying again.
The biggest risk for leaders is the bias and unknowns in your data. To combat this, develop multiple scenarios to understand the risks behind the AI systems you are using and deploying. Build in contingencies and guardrails.
Charu Mahajan: Gen AI is built on the most ‘boring’ but crucial foundations of data management. It is not about deploying the technology but having a solid data platform and proving your data’s provenance. Your model’s credibility must leave no room for doubt.
In summary, the rise of Generative AI marks a transformative era for business leaders and their organisations. As AI continues to evolve and integrate into various sectors, leaders must navigate a shifting landscape where adaptability, continuous learning, and responsible technology deployment are crucial. Embracing AI is not just about leveraging its capabilities but also about fostering a culture that blends human empathy with technological innovation. By proactively reskilling their workforce, redesigning roles, and managing risks effectively, leaders can harness the full potential of AI to drive growth and maintain competitive advantage in an increasingly digital world.