AI and Advanced Analytics – delivering value for directors and the board | Prof Bernardo Almada-Lobo, University of Porto & LTPlabs

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As board members gain awareness of the possibilities and power of AI and analytics, an almost unlimited array of potential projects, questions, or scenarios where analytics could improve outcomes arises.  The challenge is how to prioritise the various opportunities. 

In this podcast, Dr Sabine Dembkowski, Founder and Managing Partner of Better Boards, discusses using AI and advanced analytics to deliver value in the boardroom with Professor Bernardo Almada-Lobo, co-author of The Analytics Sandwich: Bringing People and Artificial Intelligence Together to Unlock Business Value. 

“If you really want advanced analytics and AI to deliver game-changing value, the secret sauce is to approach it with short, laser-focused projects”
Bernardo explains that organisations often take two ineffective approaches to AI and analytics, leading to disappointing outcomes.  They either embark on a massive analytics project, or different teams initiate numerous mini-projects driven by personal curiosity or bias.  He underscores the need for a strategic, business-led approach, focusing on short, laser-focused, collectively agreed-upon projects that are directly tied to strategy. 

“This technology has the potential to affect every industry and every function of a company”
Bernardo believes that boards must understand the opportunities and disruptions generative AI, and advanced analytics present. This awareness helps avoid two common pitfalls.  The first is that boards may demand AI projects using a push analytics approach without organisational alignment, focusing on available data rather than the problems.   Second, management teams may move faster on opportunities than their boards are prepared for.  

“By integrating AI and advanced analytics, boards can enhance their effectiveness, make more informed decisions, and drive organisational success”
Bernardo explains that integrating AI and advanced analytics can significantly enhance the effectiveness and inform decision-making of any board when considering its responsibilities. 

“Any director who fails to integrate AI into their work and decision-making process in the near future will not be allowed to serve on the board”
Bernardo warns that boards need to address know-how gaps to effectively apply AI. Board members should possess basic AI literacy, which will become a standard requirement. 

“Analytics is not a substitute for people. It's a support, a way that we have to harness their knowledge and combine that knowledge with state-of-the-art AI and machine capability to augment, instead of replacing”
Bernardo gives a list of tips for the C-Suite on AI Integration. 1. Walk the Talk. 
2. Align AI and Advanced Analytics with Business Objectives and Culture. 3. Combine People and Analytics.  

The three top takeaways for effective boards from our conversation are:
1.      Any director who fails to integrate AI into their work and decision-making process in the near future will not be allowed to serve on the board. Minimum literacy on AI will be mandatory.
2.     AI will not entirely replace human decision-makers in complex decisions. Instead, it will complement human experience and judgement.
3.     AI and advanced analytics only deliver value when problem-centric. If you want to do pull analytics, you need high C-suite maturity and sophistication.