Majority of business leaders ‘not prepared for AI transformation’

Global consultancy Kearney, in partnership with Egon Zehnder, the leadership advisory firm, has released a report titled, ‘Leadership in the Age of AI’ exploring how business leaders foresee the impact of AI on organisations and jobs, and how prepared they feel for this change.

Organisations need to get ready for change

One of the key findings of the report is that while 70% of business leaders believe their company will be disrupted by AI in the next five years, only 1 in 5 (20%) believe their organisation is currently prepared for this disruptions

The rapid growth of AI is a contributing factor to this, with 73% of those surveyed believing their preparations are limited by time, people, and money. Meanwhile, more than half (51%) believe that a lack of understanding around AI from leaders is contributing to the problem.

On the flip side, of those who feel their organisations are prepared, 89% attribute this to their leadership team’s understanding of AI and its capabilities.

AI remains an opportunity if companies plan ahead

Promisingly, the report found that 85% of business leaders still see AI as an opportunity for their organisations, with more than 90% seeing it as an opportunity for them personally within their roles. To take advantage, business leaders are getting preparations in order:

n49% are investing in infrastructure

n44% are building external partnerships

n39% are recruiting expert talent

Mirko Warschun, partner and member of European leadership team at Kearney, said: “Interestingly, leaders believe that AI is going to disrupt their organisation as a whole much more than their own day-to-day roles. Leaders can use their position to help their teams embrace the change that AI brings, and make sure their organisations are benefiting from it, rather than struggling to deal with it. Strong leadership will be vital to achieve this, as today’s report makes very clear.”

Alex Liu, managing partner and chairman at Kearney, said: “Given the widespread recognition that AI is going to be a disruptive force for most businesses, it is — surprising that business leaders still feel that their organisations are unprepared for the changes to come.

 “The report has shown that the prevailing sentiment among leaders when it comes to AI is optimism. The challenge now lies in translating this optimism into tangible action, ensuring both leaders and their teams are ready to overcome the challenges and embrace the opportunities that AI provides.”

Burcu Bicakci, partner at Egon Zehnder who leads T&C and AI in Southeast Asia, said: “Organisations are likely to change drastically with new AI-enabled technologies — and soon. The report underscores the critical role of leadership in comprehending the impact of AI on their business and steering their organization accordingly.

 “Although the pace of AI adoption has accelerated, it is never too late for leaders to devise a clear AI strategy that can guide their organisation through this transformative phase and keep them ahead of the curve.”