Leading in the age of AI

Although many core leadership principles are timeless, there’s no denying that today’s leaders operate in a new world of work. While leaders just a few decades ago were navigating computers, digitization, and the growth of the internet, modern leaders face an entirely new set of challenges and opportunities — many of which revolve around AI.

To effectively lead in an AI-driven world and embrace the new technology, leaders must become masters at adaptation and bring their people along. Let’s look at how AI and leadership work together and how leaders in all industries can embrace adaptive leadership in a rapidly changing world.

AI Is Transforming Business at a Record Pace

The explosion of AI can be summed up in a couple of words: transformative and exponential. Technology and automation that seemed like a pipe dream just a few years ago are now a reality. Every day brings a new advancement or application for AI, from robotic automation to chatbots, content creation, and data-driven decisions.

You're not alone if you feel like your head is on a swivel keeping up with new AI advancements. Less than a year after introducing programs like Google’s Bard and OpenAI’s ChatGPT,one-third of businesses said they were using Gen AI in at least one function. The same research found that 40% of organizations plan to increase their investment in AI, which is sure to grow. Buoyed by these programs, the GenAI industry is expected to explode from $40 billion in 2022 to $1.3 trillion by 2032.

Much of AI's power comes from its vast possibilities and applications. AI can automate mundane data entry tasks, analyze customer and lead data, create an image and video content, perform complicated calculations, screen potential hires for culture fit, and much more. The list goes on and on.

As rapidly as AI burst onto the scene, this is likely the slowest advancement that will take place. As companies invest more in AI, the number of use cases and quality of outputs will only increase.

That’s not to say that AI is the perfect solution to all business issues. Its rapid deployment brought several regulatory and privacy concerns, among other topics. So, although advancements may continue at a breakneck pace, regulations and industry standards may slow the application.

Even with these concerns, AI is undoubtedly the future of business. The competitive advantage it creates is undeniable in everything from customer and employee experience to manufacturing, logistics, and productivity. Modern leaders and companies must find the most effective ways to adapt and integrate this technology into their businesses to set themselves up for long-term success.

Adaptation Principles for Leaders

AI’s rapid transformation may cause leaders and companies to feel growing pains, but this isn’t the first time leaders have faced rapid evolution. For centuries, innovation has transformed how people live and work and caused leaders and groups to either adapt or fall behind.

Think about adopting the printing press, cell phones, or personal computers. Other forced adaptations come from less optimal experiences, including rapid responses to the COVID-19 pandemic, recessions, and geopolitical concerns throughout history. As the saying goes, the only constant is change. Or, as Jeff Bezos said, “We humans coevolve with our tools. We change our tools, and then our tools change us.” As society and technology—the tools—advance, so too must leaders.

But thankfully, a history of adaptation provides myriad examples of how leaders can adjust and thrive. The ability to grow, adapt, and change is one of the most significant traits of successful leaders. Consider these adaptation principles for leaders, or whatHarvard Business Review * * researchers refer to as the 4 As:

• Anticipation of likely future needs, trends, and options. Adaptive leaders have an eye towards the future. They anticipate change and weave it into their strategy. To them, change is a critical part of business, not a nuisance or disruption. Anticipation helps leaders be proactive as changes arise instead of reactively rushing to put out fires or keep up with the competition.
• Articulation of those needs to create collective understanding and support. No leader or company is an island. In an increasingly connected world, leaders have to foster collaboration and communication. That requires sharing change on the horizon and having meaningful conversations, even when they are difficult or don’t have a clear solution.
• Adaptation to drive continuous learning and adjustments as necessary. The first solution may be better. Adaptation isn’t a one-time action but a continual process that requires finessing, fine-tuning, and a willingness to return to the drawing board when needed. Leaders who excel in this area understand the need to learn and grow continually and the humility to adapt and adjust.
• Accountability, transparency in decision-making, and openness to challenges and feedback. ** ** The company must be involved, although leaders must set the tone for adaptation and evolution.

As CEO of General Motors, Mary Barra inherited a long-standing history of automobile excellence. But as the industry transformed with the breakthroughs of electric and autonomous vehicles, Barra knew she couldn’t simply do what the company had always done—she needed to respond and adapt. Barra anticipated the changes by staying on top of industry trends and developments. She articulated the need to invest heavily in autonomous vehicle technology and develop the Chevy Bolt EV. The programs required adaptation to position GM as an EV leader, but Barra embraced accountability and transparency to involve all areas of the company in the innovation.

6 Tips for Adaptive Leadership

Understanding the principles is one thing; putting them into action is another. Fortunately, adaptive leadership doesn’t have to happen overnight. Minor changes to mindset, culture, and action can lead to significant long-term changes. Here are six tips to lead in a changing world:

Become a change agent.

Leaders set the tone in how they respond to change, so one of your most extensive responsibilities is becoming your company's chief change agent. When employees or consumers are concerned about new technology or market changes, they look to leaders to be the example and lead the charge. The most successful wide-scale evolution starts with leaders who fully understand their role as change agents.

A change agent leans into an adaptive and flexible mindset and isn’t afraid to ask questions, pivot, or adjust plans. Change agents take risks and are open about the process, even when those risks don’t pay off. They understand the necessity of innovation and are willing to take the steps to get there. According to McKinsey surveys, 70% of senior executives believe that innovation will be one of the three main growth drivers for companies in the coming years. However, 65% of senior executives have little confidence in their decisions relating to innovation. Leaders have to lean into innovation and change to become change agents.

Start with minor adjustments, even as simply as pivoting when your daily schedule changes or being flexible with the agenda or location of a meeting. Small acts of flexibility can increase your confidence for more significant adaptations and help you set the tone for your business.

Create a culture of growth, learning, and experimentation.

Adaptation goes hand in hand with growth and learning. When employees understand a change, such as the potential use cases of AI, they are empowered to utilize it. Knowledge is power and can push out fear of the unknown. A culture of learning and experimentation encourages employees to continually learn, question, and challenge the status quo, not just when AI comes knocking on the door.

Leaders must create environments that encourage experimentation and celebrate failure. After all, adaptation doesn’t come with a clear blueprint, especially with changing technology. Most efforts to adapt will fail at some point. Hence, an established culture that accepts failure and experimentation opens the door for employees and leaders to innovate and test new ideas. But how can leaders make it happen? Offer regular training opportunities for employees in all areas, encourage outside learning and development, develop mentoring or idea-sharing programs and groups, and give employees the resources and trust to try new things. Many leaders run innovation challenges and invite employee suggestions backed by company resources and tested. Activities like these foster a collaborative, innovative culture.

Develop open and transparent communication.

One of the biggest roadblocks to change is a need for more precise communication. In the information age, employees are likely getting news and updates from various sources. To keep them engaged with the company, establish trust by ensuring updates come from you and that they don’t hear the latest updates—or worse, rumors—from outside sources with their commentary.

Adaptation requires open dialogue, especially with an issue as loaded as AI. Honest, transparent communication builds trust and encourages employees to speak up and share ideas. Evolving a business in the age of AI isn’t the sole responsibility of leaders; employees have valuable insights that can set the company on the right path to change and updates.

As your company addresses challenges and changes, find a way to share authentic communication through regular emails, town halls, small focus groups, social media, or other channels.

Embracing AI capabilities is uncharted territory for everyone. Great leaders invite feedback and include their employees in the movement. As you test new ideas and processes, talk to employees at all levels to understand their experience, listen to their ideas, and integrate their feedback into your plans.

Empower all employees

Along with strong, clear communication, leaders must empower all employees, not just those in the C-suite. Empowered employees are more engaged and feel a sense of responsibility and ownership in the company, which can lead to faster responses, stronger ideas, and a better innovation environment. When employees know their leaders and company are willing to invest in them, they want to invest in the company's future.

Employees feel empowered when they know the importance of their role in helping the company reach its goals and adapt to new technology and AI. Empowered employees also have the training and resources to do their jobs well and test new ideas. That often comes through training and skill-building opportunities, regular feedback and review, setting clear goals, and building a culture of trust without micromanaging employees. Empowered employees are much more likely to support leaders and follow the ride of adjustment and evolution.

Balance qualitative and quantitative metrics.

Especially when adjusting to and integrating AI, it can be tempting for leaders to rely heavily on numbers, such as productivity improvements and sales numbers. However, leaders must remember that employees are humans and not machines. Metrics and data are essential in tracking progress but aren’t the only measure of success.

AI is a powerful tool, but humans still have a distinct advantage in creative tasks. As you find ways to automate, encourage your employees to spend their freed-up time on more human functions like strategy, experimentation, and big-picture thinking.

Build human relationships

Trust is the foundation of any change management, especially in the uncharted world of AI. To build trust, leaders must remember that their employees are humans with unique skills, motivations, and goals.

One recent survey asked more than 4,000 Americans about the leadership traits that are most and least important for successful modern leaders. The top characteristic was trustworthiness, followed closely by honesty, hard work, and ethics.

When leaders focus on their human characteristics, they strengthen relationships and create an environment where their people want to follow, test the waters, and innovate because they trust that their leader has their best interests in mind.

AI brings the potential for incredible advancements and transformation. However, it also requires leaders to adapt and lead their employees and companies through uncharted territory. At the heart of this change, management builds a solid culture and ultimately treats employees as humans. Leaders who integrate AI and manage change in a rapidly changing world will set themselves and their organizations up as long-term industry leaders.