Understanding the Impact of Artificial Intelligence and Generative AI on Boards
Boards of directors are being urged to educate themselves on artificial intelligence (AI) and generative AI to stay ahead of the growing capabilities of these technologies. It is essential for boards to tap into management and external resources to understand the potential of AI, new use cases, changing business models, risks, and responsible use.
When considering AI and generative AI, directors should approach the technology from a business perspective. The board’s role is to ask management pertinent questions and challenge them when necessary. Boards may need to assess if additional skill sets are required or if they can rely on management’s expertise or that of third parties.
It is important for boards to review the costs and benefits of implementing AI within the company. This includes reimagining how work is done, employee training on AI usage, fostering a culture of learning and innovation, and capturing new opportunities.
Establishing a governance model with clear accountability is crucial for successful AI implementation. Boards must understand who owns the responsibility for AI governance within the company and evaluate the benefits and risks associated with specific technologies and use cases.
Boards should oversee a plan for AI oversight to measure success and ensure that digital transformation strategies align with business objectives. Communication with stakeholders is also key, as companies must effectively convey their AI strategy internally and externally to demonstrate relevance and competitiveness while safeguarding all parties involved.
