MITSloan and BCG – The Cultural Benefits of Artificial Intelligence in the Enterprise – Key insights

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MITSloan BCG Culture

MITSloan management review and BCG (Boston Consulting Group)

An interesting read about how there are cultural benefits of Artificial Intelligence in the enterprise. Report based on 2,197 managers and interviews with 18 executives from 29 industries and 112 countries.

Key insights

” Artificial intelligence can generate cultural as well as financial benefits for
organizations…..more than 75% also saw improvements in team morale, collaboration, and collective learning.”

I agree. AI projects should be developed as a foundation to a business and endorsed by everyone. Having an AI strategy can strengthen direction and unify business culture. There are huge benefits if done correctly.

” Respondents who use AI primarily to explore new ways of creating value are far more likely to improve their ability to compete with AI than those who use AI primarily to improve existing processes.

The key is to embrace AI at a larger level to create bigger and better value. Some companies are are going further and using AI to develop newer business models and revenue streams ie Manufacturing companies developing AI for a service model.

” Respondents who said they use AI primarily to explore were 2.7 times more likely to agree that their company captures opportunities from adjacent industries — because of AI — than respondents who use AI primarily to improve existing processes. “

By looking outward, you are being receptive to new opportunities. The act of doing this, also aligns fresh thinking.

“For CBS, AI provided both the opportunity and the means for re-examining fundamental assumptions about business operations and organizational effectiveness. “

By post analysing old research and KPIs, you can re-evaluate your fundamental objectives as well form new ones. A project without KPI’s is like a car without a steering wheel.

” 64% of companies that have integrated AI into their processes say that their use of AI led to changes in their KPIs. In some cases, AI solutions directly reveal new performance drivers “

AI insights are powerful as they can transform the fortunes of an enterprise. Every company should focus on gaining the best insights.

AI USE > Improve > TEAM CULTURE > Improve > EFFECTIVENESS > improve >

Interesting analysis. As you develop AI, build team culture and focus on effectiveness, it creates a cyclical process of increased improvement.

Paul Pallath (global technology head of data, analytics, and AI at Levi Strauss & Co) says about the importance of training to improve adoption and trust. This is a very good point as the more people understand the aims, the higher probability they will adopt and help drive it further.

“Cultural benefits emerge when teams improve decision-making and efficiency with AI, and, transitively, these benefits would not have emerged if the team’s culture had not embraced the AI solutions in the first place. When teams become efficient and make better decisions because of AI, several aspects of culture also improve, including collective learning, collaboration, morale, and clarity of roles.”

If you address an AI project head on, if implemented correctly with a clear unified focus, teams will improve decision-making. This is an iterative process of engagement, improvement has a direct affect on the culture.

” 87% of teams that improved their efficiency and decision quality with AI also improved their collective learning. “

This shows that the inertia of AI can then fuel further learning and improvement.

” At PepsiCo, executives view AI as a strategic capability. They also acknowledge that making full use of that capability goes hand in hand with strengthening the company’s culture “

Thinking of AI as a strategic capability focusses on the proactive nature of the technology. By working on this and the culture, there are huge benefits.

” Being a “company of consequence” in the future may require all employees to work with AI to “out-solve” competitors with new ways of creating value.”

Thinking of AI as a tool kit is a good analogy as you can select the best tools for your organisation. As the organisation evolves in its AI strategy, different AI tools can be implemented.

“64% of the organizations that use AI extensively or in some parts of their processes and offerings adjust their KPIs after using AI…….Organizations that don’t make AI-driven adjustments to their KPIs. Sixty-six percent of respondents who agreed that their KPIs have changed because of AI also saw improvements in team-level collaboration. “

The power of AI can expose many new opportunities as well as KPI’s.

” 57% of organizations that made few changes in business processes reported an increase in morale, while 66% of organizations that made many changes reported an increase in morale. “

Change is a huge factor for an increased morale. Using AI can initiate company wide change which in-turn could transform a company.

” A strong culture helps encourage AI adoption, and adopting AI can strengthen organizational culture. This cyclical relationship can build through numerous individual process improvements to enhance the overall organizational culture. “

The power of AI can help strengthen the culture of a company which intern improves the AI. The secret is keep this in a tight iterative cycle.

” AI becomes a managerial tool to align microbehavior with broader goals, including societal purpose, equity, and inclusivity “

The act of thinking and implementing AI can help spark wider thinking. It should be seen as transformational. There are many levels that will add value to your team. Good to get the AI strategy right first and get everyone to adopt it for ultimate success.

” Our research demonstrates a strong, multidimensional link between AI use and organizational culture. But it’s also clear that flourishing AI solutions can strengthen organizational culture at both the team and organizational levels “

The key is to look at your AI and culture. If you manage both, they should harmonize in a virtuous cycle, giving increasing rewards. If done properly you should be able establish new KPI’s for measuring your effectiveness.

Overall

This is great report . We often don’t hear about the intangible benefits of AI within an organisation. This clearly highlights some of the major benefits of AI.

You can get the report here (FREE – With a few details needed)

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