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February 5, 2019April 21, 2023

How to get the best out of artificial intelligence

Artificial intelligence-driven technology will be transformational in many industries, but how it shapes organisations will depend on their leaders, writes Jonathan Knight

Much has been written – not all of it true – about the impact that artificial intelligence (AI) will have on the workplace.

AI is already transforming automated industries, including production, e-commerce, advertising, finance and logistics. It will soon impact more analytical and advisory occupations such as law, consultancy and medicine. But media reports about AI sometimes paint an unrealistic picture of its powers and fail to allow for obstacles in its application.

There has been less discussion of the practical impact AI will have, or how its application may be slowed due to poor public acceptance. Nevertheless, despite uncertainty about the breadth and pace of its impact, it is certain that AI will create significant challenges for leaders.

AI – how far will it go?

A fascinating five minutes can be spent taking the BBC’s test to ascertain how likely robots are to take over your job in the next two decades. With the ability to analyse enormous quantities of data, perform intricate operations and recognise instructions, the direction of travel is clear: AI-driven technology will be transformational in many industries.

Needless to say, however, AI is not magic. Virtually all recent progress in machine learning has been made through ‘supervised learning’, in which input data (A) generates a straightforward response (B). Human intelligence is capable of much more than A to B; we make choices based on complex data gathered over the course of our lifetimes, through learning, memory, experience and genetics. And, given the limitations of present-day AI, robots are a lot less likely to assimilate certain skills in the near term; those, for example, that require an understanding of history and culture, or context and reason.

It is difficult to imagine robots developing the empathy of humans, which is why we are more likely to be comfortable with a robot carrying out a complicated medical procedure on us, than with a robot checking up on us post-surgery to see how we’re doing and to offer us a cup of tea.

In other words, while tasks that require complex technical skills and knowledge may be carried out by robots, there are some that we would rather were done by other human beings, with whom we can have genuine, human emotional interaction.The ability to exercise effective judgement, creativity and discretion, combined with the capacity to improvise – as opposed to simply moving from A to B – will therefore be key skills for leaders of the future. Navigating a route through the kind of complex change that AI will bring isn’t necessarily anything new for leaders. However, the scale and pace of the change that AI brings will be, and this means that weaknesses at the top are more likely to be exposed than ever before.

Challenge one: strategy – and structure

As decision makers, leaders will need not only to recognise and understand how their market context is changing but how to adapt and respond to that change. Only by doing so can leaders ensure their organisations stay ahead of (or at least keep up with) the curve, and remain relevant to those they serve. It is not surprising that boards are scurrying to ensure they include a top-notch chief technology officer, bringing digital understanding to strategic decision making – although technology executives are still poorly represented on public boards.

A few companies have gone further. Back in 2014, a Hong Kong-based venture capital firm, Deep Knowledge Ventures, became one of the first companies in the world to appoint an algorithm, named VITAL, to its board of directors. VITAL supports fellow board members by providing information on potential investment decisions, scanning vast quantities of financial figures and other data on its potential future clients, as well as trends in the market.

However, as the philosopher Voltaire was wise enough to suggest several centuries ago, it’s important to judge people ‘by their questions, not their answers’. Or, in the context of AI, the data currently produced is only as useful as the humans who feed in the data sets and analyse and interpret the results.

Leaders must therefore ensure they not only have the right board make-up to respond to technology-led change, but that they have the right structures throughout their organisations, effectively surrounding AI with the human intelligence. This brings us to challenge two.

Challenge two: skills and motivation

In responding to change and staying ahead of the curve, a second absolutely critical element to success or failure for leaders will be whether or not they bring their workforce with them; both in terms of equipping their employees with the right skills to complement AI and motivating them to remain effective throughout a potentially long period of upheaval.

We are often warned about a lack of STEM skills that will needed to navigate the future. In a recent UK study by the Confederation of British Industry and Pearson, more than half of respondent companies were concerned that their future growth would be held back by
skills shortages.

However, as AI-powered robots become easier for users to interact with, companies will need to focus on developing those skills that are distinctly human; for example, intuition, creativity, empathy, resilience and the ability to scan horizons and context in a way that adds value to the business. Getting this level, and mix, of skills right will be an important part of leaders’ future-proofing strategies, no doubt influenced by access to global talent, as well as home-grown training programmes.

In terms of motivation, as with any disruption, change needs to be driven from the top with clarity, vision and consideration for those affected. And in doing so, leaders themselves will increasingly have to focus on their soft leadership skills, rather than proving their authority through knowledge and technical expertise. The latter skills may soon become augmented or replaced entirely by AI.

Fortunately, when it comes to helping both leaders and employees get to grips with rapid change, AI is not only the problem but part of the solution. For example, at my own organisation, Ososim, we have experienced the power of AI in helping to create training simulations that are so carefully modelled on the responses of the human brain, participants find them very persuasive and effective. These simulations are already being used by some of the largest companies around the world to help improve skills and capabilities in areas such as emotional intelligence, mental resilience and persuasion.

Challenge three: vision and purpose

Finally, while all this upheaval can sound deeply intimidating, we must remember that technology has been improving the capabilities we have as humans for decades. Until now, the focus has been more on what we are physically capable of doing. Technology has helped us to achieve things that our bodies were simply not capable of doing before – from flying thousands of miles through the air to communicating with one another across continents.

With the help of AI, technology is now enhancing our mental capabilities as well as our physical ones: crunching huge quantities of information in milliseconds, and using algorithms that flawlessly remember every correction ever made.

What technology cannot yet master is understand what it is actually doing and why; nor does it care. A robot kitted out with AI has no sense of ethics or purpose, equity or fairness, beyond what we humans tell it.

And therein lies the third hugely significant challenge for today’s leaders and those of tomorrow: AI will be as ‘good’ or as ‘bad’ as humans make it. It was with this challenge in mind that, in 2014, AI research firm DeepMind insisted that if it were to sell its AI programme to Google, an ethics committee must be appointed to oversee its use.

It is imperative that human leaders, across public and private sectors, remain closely involved with the development of AI, challenging the data, putting it in context, and remembering that human creativity, vision and purpose may need to override whatever AI is or isn’t saying. AI may bring incredible progress, but it is our human leaders who must remain in charge of the moral compass.

Organisations such as the World Economic Forum have played a strong role in leading this kind of global discussion. They have set the challenge squarely at the door of leaders across the private, public and third sectors, in terms of how the fourth industrial revolution can be balanced with responsible governance and global goals, from the elimination of extreme poverty to gender equality.

Business schools, such as INSEAD, are putting the development of thoughtful, responsible leaders, at the heart of their missions. As the populist, negative emotions expressed by once-dominant groups, threatened by technological change, increasingly distract political leaders, so business leaders will need to provide the positive vision to guide inevitable technological advances.The human race has been through change before; our greatest strength as a species has been our ability to evolve and survive. But in each and every transition, leadership is key. Smart machines can make us smarter, and continue to drive our progress forward. But we must take nothing for granted.

Strategy, motivation and vision will all be essential to how well we humans ride this next wave.

Jonathan Knight is CEO of global learning and technology company Ososim. He was part of the leadership team that established Accenture Learning and a founding member of the EU’s eLearning Industry Group. Jonathan has an MBA from INSEAD. His clients include BNP Paribas, Cisco, Deloitte, London Business School and the World Economic Forum.

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January 22, 2019April 21, 2023

Exploring the future of globalisation

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January 17, 2019November 13, 2023

Exploring the principles and value of strategic corporate social responsibility

Business schools must play their role in developing business leaders who are responsible and ethical, argues Debbie Haski-Leventhal, Author of Strategic Corporate Social Responsibility, in an interview with David Woods-Hale

The global leadership responsibility imperative has firmly moved corporate social responsibility (CSR) to the forefront of the management agenda. Why is now the right time for you to launch your book Strategic Corporate Social Responsibility?

My book captures (and is designed to help lead) a major shift that is currently taking place. CSR has been here for a few decades, but there has been a lot of focus on corporate philanthropy and a narrow way of seeing CSR, not to mention ‘greenwashing’ [a form of spin in which PR or marketing is deceptively used to promote the perception that an organisation is environmentally friendly].

The focus has also been on how CSR serves business and shareholders, which is important, but it cannot continue to be the only reason to be more responsible.

The book emphasises the importance of strategic CSR, which is holistic and comprehensive, about being responsible in everything that we do, including core operations, and with everyone with whom we do business (namely all our stakeholders). It also incorporates a long-term approach instead of a short-term one. CSR cannot continue to be little more than a side show focusing on charity.

We face tremendous global challenges and business can play a vital role in helping address them through the power of strategic CSR.

How would you define strategic CSR?

I have used this definition of strategic CSR by Chandler: ‘The incorporation of an holistic CSR perspective within a firm’s strategic planning and core operations so that the firm is managed in the interest of a broad set of stakeholders to achieve maximum economic and social value over the medium to long term.’ This definition offers a broader view of corporate responsibility, one that is embedded in everything the firm does – from its strategic planning and core operations.

I also see strategic CSR as CSR that is aligned with what the company stands for and what it does best. Instead of ‘random acts of charity’, the company uses its knowledge, resources and capital to make a real difference. The only thing I would change in this definition is ‘maximum economic value’– maximising profit and growth at any cost is no longer viable. We can make profit, but not maximise profit at the expense of humanity and this planet.

Do you think sufficient numbers of business leaders around the world are putting CSR into their strategic agendas?

The business sector is like a huge ship moving slowly in the ocean. It is now shifting direction, but due to its size, it is not always easy to see. If we don’t shift – we will hit the iceberg. I strived in my book to focus on positive examples of corporate responsibility instead of on the more visible corporate social irresponsibility – not because I am naïve, but because I wanted the book to inspire others to follow these good examples.

As such, I focus on inspirational leaders, such as Paul Polman of Unilever, who, with his sustainable living plan, has shifted the entire focus of the company to sustainability, and leaders such as Indra Nooyi of PepsiCo, who leads performance with purpose. There is a shift: CSR is becoming an important part of the strategic agenda for many companies, instead of a charitable sideshow. Is it enough? Not just yet, but we are getting there.

CSR was previously considered something that could impact the bottom line if done properly. Do we need to move away from this and think strategically, yet altruistically, when it comes to CSR?

I am glad that CSR helps to impact the financial bottom line. It means that people care about these issues more than ever before when they buy from a company as consumers or work for it as employees. Research shows a strong relationship between being genuinely responsible and employee engagement and performance. Having said that, companies shouldn’t only lead CSR for this purpose.

There is a ‘catch 22’ here – if you only do good things to achieve employee engagement and consumer loyalty – it doesn’t work. Consumers, employees and other stakeholders can usually tell, even if not immediately, that CSR is not genuine. Usually, there will be some unethical behaviour involved. And greenwashing will lead not only to lack to trust in the company, but to lack of trust in CSR in general.

There is nothing worse than being unethical about your ethical behaviour.

So yes – you need to think strategically about CSR, work hard for real stakeholder integration, avoid shortcuts and above all – be genuine.

Do you feel enough is being done to embed the UN’s 17 sustainable development goals (SDGs) into business strategy?

The SDGs are so important, not only because they aim to achieve remarkable goals, such as ending poverty and hunger by 2030, but also because they offer a great opportunity for humans to discuss what is important for us as a race and how we can achieve it together. The SDGs present an enormous task and challenge, and therefore require global and cross-sectorial collaboration like never before.

As I wrote in the European Financial Review, this is not only a challenge for business, but also a great opportunity to align strategy with something that matters to everyone. I see large multinational companies, as well as smaller ones, that choose to focus on several SDGs and take amazing and innovative actions to help achieve them.

There is work to be done to get more companies and stakeholders on board, but I have never seen so many companies aligned around shared goals as in the case of the SDGs.

What are some of the best ways to implement CSR strategies into an organisation, so employees take these initiatives on board, and so stakeholders, in turn, can see the organisation is making a difference?

If a company wants to adopt strategic CSR, it must integrate and involve all its stakeholders to do so. First, because it is an enormous task, and second, due to the definition and nature of strategic CSR. By definition, it requires working with a broad set of stakeholders and for CSR to be embedded in everything that we do – and you cannot do this with the executive leadership alone.

There are great ways to involve employees, consumers, shareholders and all other stakeholders in the company’s strategic CSR. Employees can be involved in corporate volunteering and sustainability, but they can also lead the strategic direction of the company’s CSR. In my book, I discuss employee-led CSR and provide some great examples of it. Companies involve their consumers, who show higher levels of consumer social responsibility than ever before, in their giving, volunteering and sustainable development.

You cannot do it alone, you shouldn’t do it alone, and involving your stakeholders is the only way to achieve holistic responsibility in everything that you do.

Should an organisation market its CSR? If so, how can it do it in a way that is ethical?

That’s a great question and the reason why I have included an entire chapter on CSR marketing. It was important for me to offer a book that outlines the theories, concepts and models on the one hand, but also the practical tools of CSR on the other. I did not see a chapter on CSR marketing in other CSR books, and decided to write one.

The chapter focuses on three aspects of CSR marketing: should we PR our CSR, ethical marketing, and social marketing. To answer your question – yes, we should market our CSR, because it is a good way to communicate with our stakeholders, inspire others and be held accountable for what we are doing. BUT – and this is a big ‘but’ – companies should only do it if their CSR efforts are holistic and genuine.

I give examples in the book of companies that were not genuine and holistic, and how CSR marketing backfired. It doesn’t mean that the company needs to be perfect – I don’t know a perfect company – but CSR needs to be holistic. You cannot do harm to people’s health and the planet in your core business and then market your corporate volunteering or company’s giving. It doesn’t work.

How would you define a responsible leader and what are the challenges they are facing today?

I don’t think we can talk about strategic CSR, let alone achieve it, without responsible leadership. I discuss concepts such as responsible, ethical, sustainable, servant, conscious, and transformational leadership in the book, as each of these concepts bring another important aspect of responsible leadership.

At the end of the chapter, I offer an holistic definition of responsible leaders that aligns with the one of strategic CSR: ‘People (in any position) with a strong purpose and a vision to better humanity, who incorporate an holistic CSR perspective within a firm’s strategic planning and core operations, work to meet the interests of a broad set of stakeholders, and strive to achieve maximum economic and social value over the medium to long term.

‘They do so based on a strong purpose and values, while being true to the self and with the aim to serve others. They share the leadership with others in the organisation in order to achieve these goals.’ This definition also emphasises that responsible leadership doesn’t have to come from the top – any employee can help lead social responsibility.

How important is it to measure the impact of CSR, and what are some of the best and innovative ways in which this can be done?

It is extremely important to measure the impact of CSR for several reasons. It provides constant benchmarking which can help the company improve its CSR; it increases accountability; it helps to communicate with and involve all stakeholders; and it assists in setting clear goals. Social impact assessment (which is processes of analysing, monitoring and managing the intended and unintended social consequences) also provides vital information that allows a company to assess the effectiveness and efficiency of its CSR compared to other companies; what it has done in the past and to what it could do in the future.

It therefore creates a pathway for improvement and a strong impact in the future. There are many ways of assessing social impact, from the basic logic model to social return on investment. What is important is to measure outputs and impact, not only inputs and outcomes, which is what most companies still do.

You reference management guru Peter Drucker in your writing. He said that in every social issue there is an opportunity. Do you believe there is an imperative for business schools to address societal problems?

Absolutely! As the shift is taking place in the business sector, the attention is also drawn to business schools and their role in developing business leaders who are responsible and ethical. There is a great opportunity for business schools to rise to the occasion and use their own resources, talent and capital to make a difference.

I have been conducting international studies together with the UN Principles for Responsible Management Education (PRME), and the voice of millennial students all around the world is very clear: they expect their schools to deliver responsible management education and to help them lead responsible businesses.

I see business schools that are doing amazing things – from assisting refugees to helping to end poverty, and a genuine shift in mindset, leadership and curriculum. Analysing the mission statements of the Financial Times top 100 business schools, I found that 70% of them frame their mission around responsibility and impact. It is a great time to be an educator and a leader in this field.

Do you think MBAs have taken more of an interest in using their skills to create a more sustainable world over the past few years?

I don’t think so, I know so. These studies I have been doing with PRME on MBA students around the world demonstrate that the new generation of business students is very different to those that came before. There are many studies from the 1990s and 2000s showing business students to be less ethical and more corruptible than other students and that business education only made them more unethical. But this has changed. Our studies, and others, show that business students now care very much about sustainability and CSR and expect their business schools to deliver on this.

These studies received a lot of attention from the general media, and were mentioned by the New York Times, because they deliver a clear and different voice of the students. One of the most interesting findings was that one in five business students were willing to sacrifice 40% or more of their future salary to work for an employer exhibiting all aspects of CSR. I am very optimistic about the future of our world when I see what MBA students care about. I don’t think we should leave our problems to the next generation, but I know it will be a much better generation of business leaders than previous and current ones.

Debbie Haski-Leventhal is an Associate Professor of Management at Macquarie Graduate School of Management (MGSM), the Faculty Leader of Corporate Citizenship and the Director of Master of Social Entrepreneurship. As a scholar of CSR, Debbie initiated and led the MGSM CSR Partnership Network. Together with PRME, she conducts international studies on MBA students and their attitudes towards CSR and responsible management education. She has published over 100 papers on CSR, responsible management education and volunteerism, including more than 40 peer-reviewed articles in highly-ranked journals. Her book on Strategic Corporate Social Responsibility with a foreword by David Cooperrider was published in March 2018 by SAGE.

This article originally appeared in the print edition (January 2019) of Business Impact, magazine of the Business Graduates Association (BGA).

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