In Part 1 of this article, we explored the great disruptive potential of AI in business, along with the advantages for organisations that embrace the technology early. However, AI brings its own set of problems and risks – as careful preparation is needed to minimise the danger of unintended consequences.
The future economic effects of artificial intelligence are hard to calculate, but are likely to be staggering. A study by McKinsey Global Institute estimated that worldwide GDP could increase by up to $13 trillion by 2030 as a result of AI alone. Current research within APAC, however, shows that companies across te region have yet to prepare themselves for the next generation of computing – with fewer than half of them having begun to make the necessary transition in earnest, even as four in five already agree that AI adoption is a necessary step for staying competitive.
This delay may prove costly. With AI already beginning to transform the business world, demand for qualified talent is increasing more quickly than supply. As the technology itself becomes ever more complex, the talent pool capable of effectively building and operating it begins to shrink. All sectors of society, from government to private industry to the general workforce, will need to prepare for a significant paradigm shift.
Priorities for Government
Individual countries can prepare for an AI-driven future through proactive education and business incentive programmes. Computer skills can be transmitted through the education system as well as through work experience, and the more each country’s government invests in promoting these skills in both the public and private sector, the more valuable its future workforce is likely to be in the coming digital economy.
Currently the US and China lead the way in AI-based research and innovation, with other advanced economies showing promise as well. But the balance could just as easily be tipped in another direction if another country with a large educated population – India, for example – decides to invest heavily in a digital future. The lower labour cost of a highly skilled foreign population could lead private companies to source their digital operations elsewhere, leading to instability even beyond the job displacement that AI is otherwise expected to bring. The very nature of the digital economy makes such relocations easier for companies to organise, despite the impact on the communities they decide to leave behind.
The potential for lost employment opportunities should prompt governments to research additional safety nets for populations that may be unable to find work in an unpredictable new era. The idea of a universal basic income is frequently discussed as a potential component of the coming digital economy, given the difficulty of guaranteeing an adequate supply of work as AI’s influence continues to grow.
Apart from these issues, governments should be prepared for the monumental cultural impact that the AI-driven world is currently having, and will continue to have as time goes on. Shifts in employment patterns; increases in quality-of-life differentials for rich versus poor citizens; news sources optimised to interact in entirely separate ways depending on the identity of the consumer, thereby ensuring that people base their opinions and convictions off of different sets of facts – these factors could create new fault lines in society that governments need to anticipate in advance.
Priorities for the Workforce
AI will result in many types of old jobs being lost, even as new ones are created at the same time. Median incomes are likely to rise in developing countries and fall in the more advanced economies, at least if all countries invest in AI technology to the best of their ability.
Production will improve and employment alongside robotic partners is likely to become more satisfying, as the more repetitive (or dangerous) tasks can be handled algorithmically. Employees may nonetheless find themselves experiencing lower job security, never knowing for sure whether the next AI update will make their own position redundant.
Employees therefore will find themselves in a more secure position by taking the opportunity to learn new skills through training programmes both in and out of their place of employment. As a changing economy values flexibility at all levels, workers as well as their employers will need to be prepared for the next change in the market.
Priorities for Businesses
Apart from a speedy and safe plan for launching a new, AI-driven business model, businesses will also need to invest in their workers. New technology requires specific skills to operate it, necessitating continual training programmes for employees. When a company invests in developing its talent, it also demonstrates the type of commitment that is likely to be reciprocated through employee loyalty.
A carefully trained workforce is also far more likely to produce new and useful innovations for the benefit of the company. It is also the only way for companies to become powerful drivers of change, rather than merely fast responders to innovations made elsewhere.
Successful leadership in the business world depends on many different factors integrating together smoothly. For this reason, sustained high-level performance can only be achieved alongside a carefully developed programme of risk management, which prevents problems before they occur while also responding quickly and effectively to hazardous situations when they do arise.
This element of security is an essential component of any business that aims to lead in the coming era of digital innovation. It also highlights the importance of careful planning at all stages of AI adoption, which should extend throughout society.
While the precise impact of AI on our future is still impossible to predict, what we do today will have a real effect on how well we respond to technological advances tomorrow. Widespread STEM education, a trained and flexible workforce, and far-sighted business practices are needed to prepare for the economic changes that are already on the way. Laying the groundwork for success now will pay immense dividends in the coming years, as a smoother transition to the new digital world will produce the best results – for businesses and for society as a whole.