How AI could give us a four-day work week and shape the future of business – The CEO Magazine

Theres a name thats mentioned in every story written about artificial intelligence (AI) since 1984, and its not a scientist. Its Arnold Schwarzenegger. So lets get this out of the way. The Terminator is a very fine film, but it is not a documentary.

Futurist and author Gihan Perera, who has been watching computer intelligence grow exponentially for 30 years, admits, Artificial intelligence scares some people. They think its a killer robot. Theyre thinking of Arnie Schwarzenegger, but thats not what AI is. Its just self-learning software.

We dont need to worry about the singularity. Thats dystopian thinking. But theres also a utopian view where, thanks to AI, well all be living lives of luxury, doing everything we choose to do.

The reality will be somewhere in between.

This sounds vaguely reassuring. Whats not in doubt is that businesses which dont quickly adapt to and capitalise on the myriad advantages of AI will be terminated by those that do.

In business, if youre not engaging with AI, youre going to get beaten; its that simple, explains Perera, author of Disrupted: Leading the Change Through Crisis, Recovery and Growth.

One of the biggest mistakes that I see leaders make with AI is that they dont realise how powerful it already is. They pray that they wont need to get on the AI bandwagon because they think its too difficult, but its already here, and the businesses on the bandwagon are riding away from them.

The key is a term that humans generally struggle to understand exponential growth (rarely seen in nature, or at least, not until a health pandemic comes along).

We dont see much exponential growth in real life, and the best business example is Kodak, which was one of the biggest brands in the world in 1995, and filed for bankruptcy in 2012, Perera says.

Kodak didnt understand exponential growth. We often hear that they were afraid of digital, but it was actually someone in the company that invented the digital camera, took it to senior management and said, What do you think of this?

You might think management said, Destroy it. Its going to kill us, but its the opposite; they said, This thing is grainy. Its slow. It will never be as high quality as film. Dont worry about it.

But they didnt take into account that technology grows exponentially, and they were quickly overtaken.

Another thing a lot of people dont realise is just how much AI is already a part of their everyday lives, and how much it is driving the success of some of the biggest companies on the planet.

AI already sets the prices on Amazon, predicts your Google searches, runs your GPS, sends you an Uber, matches buyers and sellers online, recommends songs on Spotify and even qualifies borrowers for companies like Ant Financial Services Group.

In business, if youre not engaging with AI, youre going to get beaten; its that simple. Gihan Perera

This giant Chinese company valued at around A$400 billion, or three to four times the equity value of Goldman Sachs uses AI for consumer lending, credit-rating services, investment funds and selling health insurance.

Marco Iansiti, a Harvard professor of business administration and co-author of Competing in the Age of AI, explained in the Harvard Business Review, Unlike traditional banks, investment institutions, and insurance companies, Ant Financial is built on a digital core.

There are no workers in its critical path of operating activities. AI runs the show. There is no manager approving loans, no employee providing financial advice, no representative authorising consumer medical expenses.

And without the operating constraints that limit traditional firms, Ant Financial can compete in unprecedented ways.

This isnt the future; its whats happening right now, and regardless of whether you run a digital startup or are part of a traditional business, its essential to understand the revolutionary impact AI has on operations, strategy and competition, Iansiti says.

Again, its important to realise were not talking about the AI of science fiction here computers that are indistinguishable from humans and able to reason like us, which is known as strong AI.

All you need to shake up a business completely is computers that can perform and continually get better at tasks, lots of them, traditionally left to humans, or weak AI.

Software makes up the core of the firm, while humans are moved to the edge, as Iansiti puts it.

This will, of course, mean fewer jobs for humans partly because AI systems will work 24 hours a day for almost no dollars, which humans cannot and will not and the implications are far reaching.

AI-based operating models can exact a real human toll, Iansiti says in the Harvard Business Review article. Several studies suggest that perhaps half of current work activities may be replaced by AI-enabled systems. We shouldnt be too surprised by that.

After all, operating models have long been designed to make many tasks predictable and repeatable. Processes for scanning products at check-outs, making lattes and removing hernias, for instance, benefit from standardisation and dont require too much human creativity.

Toby Walsh, Professor of Artificial Intelligence at UNSW Sydneys School of Computer Science and Engineering, sees hope in that latte example, however, and says that in some ways, AI will make humans more valuable and valued.

Computers arent going to take over all jobs because we are social animals. We prefer human contact. I mean, why do we pay humans to make coffee when a machine can make it better? Because we like the fact that baristas flirt with us, gossip with us, Walsh insists.

Therell be plenty of jobs like that doctors, for example; they will have AI assistants, but we will prefer a human telling us the bad news because they have empathy.

Ubers will be autonomous eventually. Thats how theyll really start making money, but people will pay extra to have a chauffeur. They might not even drive the car, but well pay for them to carry our bags and chat to us.

Well also pay extra for humans because we prefer them.

Perera agrees that its not time to panic yet. While the growth of AI may be exponential, people, on the other hand, are slow to change, so weve got time.

McKinsey actually did a report that found that robots and AI will create more jobs than they destroy, but what we worked at 20 years ago is not going to work in the future, he cautions.

Its also going to change the kind of jobs we have. When Uber went looking for a new boss, they hired a tech expert, not someone with experience at a taxi company.

Walsh, who has been fascinated by AI for 40 years, agrees that companies and business leaders need to adapt because things are changing at incredible speed.

The past decade has been the most exciting because AI has moved out of the laboratory. Ten years ago, I never spoke to a journalist or a politician about it, and now, Im constantly being asked, Where is this taking us? he says.

Its true, though, that any company that sits on its hands will be eaten by its competitors. Look at Amazon, FedEx. Theyre the early adopters. Theyre the ones that are prospering while other companies are going to wither.

Walsh says the short-sighted way to introduce AI into your business is to merely focus on reducing headcount, but he says thats a race to the bottom.

The other way to look at it is as an opportunity to see that peoples time is freed up by AI, so they should concentrate on improving the product, moving the business forward, Walsh says. It allows you to concentrate on what people are good at, that emotional intelligence that humans have.

Perera, who regularly helps businesses and large corporations integrate AI into their workplaces, has very specific advice. He says the first thing to do is buy the AI tools that can assist in your peripheral operations.

AI can record your Zoom meetings, file them away and then give you instant retrieval, based on a few words you recall from the meeting, he says.

It can also answer an email from someone seeking to interview you, look at your diary and then because it knows what time of day you like to do that kind of thing offer that person some options and set up the whole thing for you. The other person will assume theyre dealing with your human EA. Its that seamless.

The second step is to look at how you can build AI into your main operations: Things like your supply chain, production, collecting data, getting AI to analyse and take advantage of that, Perera explains.

And you dont have to build this from scratch. You can rent AI the same way you rent office space. Google and Amazon rent out their incredibly powerful machine-learning systems for your use.

You can even use IBMs Watson for US$100 a month. Its an incredibly powerful machine-learning AI that actually beat humans at the game show Jeopardy, which is something we think only humans could understand because it uses double meanings and wordplay.

But it wasnt trying to work like a human brain. It was using data and creating patterns. You can imagine how useful that would be to businesses.

So just how profound a change are we looking at in the way that business, and our lives, are run? Were talking genuinely revolutionary, like the industrial revolution, only bigger and faster, according to Walsh.

People forget that the weekend was invented by the industrial revolution. That was a human-made construction, brought about by workers wanting Sunday off, and because of the gains made by industry, they got that, he explains.

We could end up with a three-day weekend. You could pay people more for less work and theyd be happier.

As for timing, if you look back at 2020, it was clearly a time of change in many ways, but Perera believes it will be a landmark year in what he calls the technological revolution.

Well look back in 20 or 30 years time at how much COVID-19 accelerated digital change and automation, the way we all started to work through screens, contactless payment, online shopping, he predicts. Well look back at this as a really significant moment in that change.

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How AI could give us a four-day work week and shape the future of business - The CEO Magazine