AI learning systems and big data continue to accelerate business transformation around the world, but boards and senior management are struggling to figure out how these technologies can best reshape their organizations.
Consider the findings of a recent survey by the consulting firm KPMG which surveyed 250 executives at director level or above in companies with more than 1,000 employees about data privacy. Some 29% admitted that the way their own company collects personal information is “sometimes unethical”, while 33% said consumers should be concerned about how their company uses personal data.
While digital technologies enable the development of new business models and environments – whether in the form of products, services, revenue streams or efficiencies – they also present a significant source of risk.
The exploitation of digitized products and systems leads to the growth of new organizational procedures, new business models and business offerings, with the financial sector in particular experiencing a profound change in its service delivery. Extensive user interface connectivity and faster back-office information processing and procedures are hallmarks of this rapid growth.
Digitization has moved from improving the delivery of traditional jobs to creating fundamental new business opportunities. This has been exemplified by digital payments made via blockchain and new protocols for employee and customer engagement through remote sales and service.
FinTech companies and creative financial service providers are now offering a host of new financial innovations, businesses, software and other unique ways to interact with customers, all under the banner of “digital finance”.
A digital transformation of the industry
Indeed, digital technology has transformed existing markets, industries, and organizations, while creating new ones, namely platform-based marketplaces and Decentralized Autonomous Organizations (DAOs).
Some forecasters believe that by 2024, 50% of all AI investments will be quantified and linked to specific key performance indicators to measure return on investment. If this materializes, corporate boards will increasingly integrate ROI disciplines into any AI development plan.
Despite this incremental march, the use of AI and blockchain technology also introduces significant ethical, cultural and social challenges that require careful management. Directors and officers must balance the benefits and risks of what is possible.
It is clear that digital technology, while offering significant efficiencies, cost savings and potentially improved customer satisfaction, can also involve technical complexities and risks associated with the use of expertise and businesses third parties, as well as structural dilemmas such as unemployment.
Few boards and executives have stepped up to take responsibility for responding to these emerging sensitivities, a trend that is likely to become increasingly noticeable as AI and related technologies continue to disrupt business functions. traditions of organizations and society.
According to the United Nations, about 60 percent of women work in the informal economy, putting them at greater risk of falling into poverty. As things stand, women are more likely to work in low-paying jobs, particularly in the health and social care, arts, entertainment, leisure industry and service industries. catering and accommodation. In short, all jobs requiring human care and empathy are undervalued.
Add to this data the The Bank of England says the number of credit cards and loans hit its highest level in five years in February 2022as fuel and energy prices in the UK are at their highest level in 30 years, and it becomes clear why 1.5 million British citizens now face absolute poverty.
The threat of social unrest
This is a precursor to the risk of social unrest and a direct consequence of the ever greater search for efficiency. Managers regard technological progress as a primary objective, while maintaining employment is secondary.
In this data-driven environment, the leader’s mindset drifts towards feeling less responsible for their decisions and actions. The underlying sentiment is that ethics can be easily corrected with the right technology, which means that ethical decision-making is unwittingly entrusted to algorithms programmed by technical experts in an inward-facing AI environment. .
Today, the emphasis on developing technical skills by directors and senior managers overshadows the need for human leadership capabilities.
While continuing on this trajectory, business leaders will feel less able and less obligated to deal with ethical and moral organizational dilemmas. In fact, the danger is that moral concerns are delegated to AI machines.
The moral lie of AI?
If big tech succeeds in convincing the business world that AI can effectively deal with uncomfortable moral issues, leaders will increasingly feel willing to leave the tough decisions to a machine.
Moreover, as business leaders become increasingly disconnected from human and ethical concerns, stakeholders are likely to be treated in a markedly less human way.
We already live in a world where algorithms are used to design the new workplace. Employees are supervised, hired and fired by machines, while their work schedules are judged and adjusted based on live calculations of their performance data.
Such an environment relies on the underlying assumption that humans work at the same pace and with the same level of consistency as machines.
Algorithmic management shapes and influences the experience of workers, the structure of their day, and the standards of their work, while setting prices and even determining pay by deciding on a minimum or standard rate.
As a result, employees risk feeling coerced and treated like mere robots, while experiencing levels of pressure and stress that in any other circumstance would be known for what they are: inhuman.