Navigating the AI Landscape: What Business Leaders Need to Know

As artificial intelligence (AI) tools like ChatGPT, Gemini, Claude, DALL-E, and others continue to gain popularity, business leaders are faced with the challenge of understanding how to leverage these technologies effectively. With demand for AI content and programs at business schools on the rise, it’s clear that AI skills are becoming increasingly important for those in leadership positions.

At a recent summit at INSEAD, two leading professors shared insights into the fundamentals of AI and its applications in business. According to Villa Satopää, assistant professor of technology and operations management, AI is essentially a machine’s ability to perform human cognitive tasks and analyze massive amounts of data with speed and rigor. Machine learning (ML), a subset of AI, is particularly powerful in crunching data and making predictions based on patterns.

One of the most famous examples of generative AI is ChatGPT, which uses deep learning to predict answers to prompts. While gen AI can be incredibly efficient at tasks like summarizing documents or generating creative ideas, it is not without its flaws. Villa noted that around 20% of the information generated by ChatGPT is inaccurate, highlighting the importance of human oversight.

Despite the potential of AI to revolutionize business processes, many companies are struggling to see a return on their AI investments. Professor Peter Zemsky emphasized the need for businesses to find ways to extract value from AI technologies and overcome challenges related to employee adoption.

Opportunities for using AI in non-tech companies include quick problem-solving, idea generation, and data synthesis. Additionally, AI can be used in learning and development initiatives, such as role-playing scenarios with avatars or bots. The emergence of APIs also presents opportunities for businesses to streamline operations and improve efficiency.

However, it’s important for business leaders to be aware of the risks associated with AI, such as data management issues and algorithmic bias. While AI can offer significant benefits, it also requires careful oversight and management to ensure its successful implementation.

Ultimately, business leaders cannot afford to delegate all AI knowledge to their teams. Understanding where and when to invest in AI is a critical skill for today and tomorrow’s leaders, as the technology continues to shape the future of business.