Artificial intelligence collides with managers | Business

artificial intelligence [IA] it has become a slogan,” according to Darío Gil, vice president of IBM and director of the largest research laboratory on the planet, IBM Research, with more than 3,000 employees. Everybody uses it, but very few really know what it is. “Any software is labeled AI,” he adds. Although it dates back to 1956, the large neural networks that make computers capable of thinking and learning to react based on processed data were not successful until 2012. Today, despite their notable impact on company productivity, “ the main barrier to its expansion is managers, who have to understand it”, explained this executive during the IESE Annual Alumni Meeting, held last week in Munich. “And integrate it into day-to-day work, which requires changing processes and our way of working.”

“A threat to artificial intelligence is the lack of understanding on the part of leaders on how to use it to solve the problems of their companies and make them more competitive,” agreed María Marced, president of TSMC Europe, the world’s largest chip supplier. “In Spain, the ministries and local authorities have read McKinsey and know some words like green algorithms, which they ask us for. But I don’t know what green algorithms are”, Inma Martínez, an expert in digitization and adviser on AI to governments such as the British, Spanish or European, jokingly illustrated. “We need to help leaders use this technology.” “And explain to them the safety of AI models,” added Gil.

The lack of knowledge of companies and governments is the reason why the appointment of IESE alumni, which has brought together almost 2,000 people and a group of journalists invited by the school in the German city and virtually, has dealt with the artificial intelligence, says Franz Heukamp, ​​its CEO. “Executives have to understand new technologies, their potential problems and how to solve them. The challenge is to get this knowledge transferred to business models”. These algorithms help reduce business costs by 20% and, according to 27% of the managers consulted by McKinsey, their application generates at least 5% of corporate profits.

The expansion of AI has accelerated. If just a few years ago there were 10% or 15% of world companies that integrated it into their projects, today they are more than 50%, according to Gil. And the crisis we are facing does not seem to be stopping the process: “To be able to do more for less, the only way is to adopt technology. It is such a powerful force that the investment lever cannot be stopped in a crisis context.” Alejandro Beltrán, president of McKinsey in Spain and Portugal, agrees with him: “More is being invested than before, the crisis is not affecting it. The sectors that are disbursing the most money are telecommunications, information technology and banking, especially due to risks and compliance [cumplimiento normativo]”.

The use of data worries citizens, businessmen and public bodies. Fiascos like the Facebook Analytics one or the fact that Elon Musk is considering giving up the purchase of Twitter due to his alleged mistakes have only increased reluctance. “Governments want to invest in AI and are putting budgets on the table, in the case of the United Kingdom, but we have to ensure regulation to protect people,” says Martínez.

Governments became aware of the existing regulatory vacuum when their companies began to use algorithms and for a little over five years they began to worry about this issue, explains the government advisor. The Chinese government has no restrictions on the development of this technology and uses generic facial recognition, which is prohibited in European countries because it violates civil liberties. “The United States does not focus on protecting citizens with its laws, as it is dominated by the business lobby,” says Martínez. In fact, Facebook had three data breaches a year affecting 300 million people. “Regulation has a role to play,” she says. “If we talk about implementing laws, governments have to join companies to know what to do,” says Marced, an opinion shared by Gil, when 80% of technology is in the hands of private industry. “The geopolitical alliances of the future are going to have a technological character”, she foresees.

Geopolitics

But the IBM executive believes we are driving the “fear factor” around AI, which could end up limiting its development. For the first time, the technology has been raised to the level of geopolitics, with the EU and the US drafting an AI Bill of Rights to guide and regulate the field, he says. Something similar happened with the recent chip law in the US, by treating the manufacture of chips as a national security problem, after the shortage during the covid that stopped the manufacture of cars, computers, telephones…, appreciates Gil, who advocates because Europe does not limit the capacity for innovation with its laws. “European regulation does not encourage innovation and disruption as occurs in the United States, it is focused on protecting rights,” agrees Beltrán.

In any case, “AI is the most important technology of our time. It will influence a lot in the future”, emphasizes Florian Deter, General Manager of Microsoft in Germany. For leaders, much of the challenge in the coming years will be bridging the technical and business sides, and facilitating trust with a public that is suspicious of what their data is being used for, according to Philippe Sahli, CEO of the start-up Yokoy.