Business insight is needed to harness artificial intelligence

By Julia Handl, Professor in Decision Sciences, Management Sciences at Alliance Manchester Business
School

Did you see that viral photo of the pope wearing a white puffer jacket? Or hear that duet between Drake and the Weeknd that was streaming on Spotify?

It took a moment for people to realise that they weren’t quite what they seemed. In fact, neither of these things actually happened; they were created using Artificial Intelligence (AI) tools like ChatGPT and DALL-E 2, which anyone can access for free.

This just serves to highlight the importance of critical thinking in the era of rapidly-evolving AI.

Business leaders have always needed critical thinking skills and are well versed in differentiating between the relative reliability of information sources before reaching a conclusion based on the evidence at hand.

What’s changed over recent years is that the quantity, diversity and complexity of data available to executives is now such that it requires more advanced knowledge to really analyse.

The advancement of data science and AI offers huge potential for us to distil and comprehend the information intrinsic to these data more efficiently. But while the potential rewards are plentiful, businesses need to understand how these techniques can be applied most effectively – and how to avoid potential risks.

Scale and speed
There are two common areas business leaders look at when considering how they can effectively integrate AI and data science into their operations.

The first – and probably the most applicable to the majority of businesses – is to ensure that all the available data is considered when making decisions. AI has the ability to integrate a lot more data and support its analysis in ways that can potentially save a huge amount of time and resource.

The second is how AI might be used to change the products or services that a company is delivering, including the rapid production of prototypes.

The benefit in both cases is that it can vastly increase the scale and speed at which businesses can operate. But what are the risks around AI and what must firms consider to ensure they’re using it responsibly and effectively?

An imperfect partner
It’s very important that businesses don’t just think about AI in terms of what it can deliver for them as a company, but also what it means for all stakeholders, including customers.

Try to anticipate how customers will feel about the way in which you are using their data, for example.

That should also prompt you to reflect on things like biases and whether you could inadvertently introduce disadvantages to a subset of your customer base. One of the myths about machine learning is that, as a computer-based system, it is entirely objective, but that’s not actually the case.

AI systems simply learn trends and patterns that are intrinsic in historical data, and so, if sufficient care is not taken, they can actually amplify existing biases in society rather than prevent them.

For that reason, it is very important to understand the limitations of these systems, question and evaluate AI outputs, not just accept them as the truth. If they are used without us critically analysing the results they’re giving us, then they can actually be more dangerous than useful.

The importance of oversight
To that end, a key strand of the Data and AI for Leaders course that I teach at Alliance Manchester Business School, as part of our new Executive Education programme, helps participants to explore some of the conceptual differences between different AI models, their limitations and biases.

Applying AI in a business doesn’t just require technical know-how, it requires an in-depth understanding of the organisation, too. So, to create real opportunities out of data science and AI, you need that technical knowledge embedded across different functions so colleagues can come up with realistic AI-informed ideas.

In most cases, this will require a rapid upskilling of colleagues so they can use AI effectively, critically analyse its outputs, understand its limitations and appreciate the ethical implications involved.

Our executive education course is a bite-sized four-day programme that can equip business leaders and colleagues with the skills they need to effectively embed best practice across their business.

They’ll also receive a Professional Certificate, and can combine with three other courses for a Manchester Professional Diploma in Leadership.

There’s no doubt AI is changing the way we look at the world. The full implications of this transformational technology will take time to play out, but at the moment, firms must have a steady human hand on the tiller.