Managers Can Keep Their Job, All Thanks to AI’s Inability in Management

Managers Can Keep Their Job, All Thanks to AI's Inability in Management

Managers won’t ever be replaced by AI. People still have a significant cognitive advantage when it comes to reframing

The most important tool managers employ to run their companies is thinking. It involves the intuitive and conscious processing of information in two different ways, referred to as thinking quickly and slowly, respectively, by Nobel winner Daniel Kahneman. These days, computers perform in both areas better than individuals do. As long as the rules and constraints of the job are known, computers may readily outperform humans in conscious-reasoning activities due to their raw computational capacity. Managers frequently use simulation and mathematical optimization to construct investment portfolios, determine the price, and comprehend supply-chain risks. And while computers can now be taught to generate their own intuitions from massive amounts of data via machine learning, humans are still better at pattern identification, which is primarily intuitive. Via recent research, they outperformed humans at complex tasks including picking investment targets and identifying cancer in computer tomography scans.

Can managers still benefit organizations given the state of affairs? Fortunately, there is one cognitive capacity where humans still have an advantage over machines. Reframing, the procedure through which we reevaluate the constraints, goals, and presumptions we approach decisions with, requires extremely slow though. The goal of reframing is to clarify the problem at hand rather than attempt to solve it (either through unconscious or conscious reasoning).

Reframing is difficult. The organizational history, the history of the industry, and the education and experience of the executives themselves can all have a significant impact on how managers frame decisions. We perceive reframing as really slow thinking since it can take a long time. Because organizations frequently innovate ground-breaking business models when they depart from conventional notions of how value is created and collected, reframing is essential. Visit Amazon. A CNBC reporter questioned Jeff Bezos in 1999 because his business no longer qualified as a pure internet investment for investors due to its huge, expensive distribution centers and large workforce. The Amazon CEO retorted, “Internet, internet.” He disagreed with the notion that a low-cost online business strategy was necessary for survival. Instead of adopting the “pure internet” versus “traditional retail” dichotomy, he reframed the discussion and showed how all of Amazon’s business strategy decisions were driven by the preoccupation with delivering a fantastic customer experience. Reframing might be especially important when market conditions shift. Think of Nokia. The feature phone industry had come to expect that when new products were successful, sales would soar and profits would be high. As a result, the business chose against making some expensive investments and abandoned strategies that didn’t yield quick returns. It put an end to a number of ground-breaking developments in the early 2000s that were seen to be too hazardous or didn’t initially enjoy mass adoption, such as touchscreen phones, tablet computers, and mobile gaming. When rivalry reached the level of an ecosystem, this business strategy was very harmful. Software development kits, third-party ecosystems, and apps, according to a former Nokia executive, “were a second priority” while Nokia continued to flood the market with new hardware. Additionally, large-scale consumer services do not develop in a matter of a year or two, as a former Nokia manager said in an interview. We’ve frequently lacked the patience for that. The rapidly evolving hardware king lacked a fresh long-game perspective that was necessary for the smartphone era.

Reframing skills will become more important as the wheat and the chaff is separated in a future where managers can utilize technology to improve their capacity for both quick and slow thought. Some strategies to help you cultivate can be: making hidden assumptions explicit, engaging in playful exploration, and leveraging (surprising) analogies. Managers should make sure that the rest of the organization supports reframing even though they can add these methods to their toolkits to improve their own reframing abilities. The first step is to create channels and a culture where employees have time for joyful exploration and incubation and where internal devil’s advocates and visionaries can express their concerns and suggestions. Even though these initiatives might not show results once, they might be necessary for the organization’s rejuvenation and long-term profitability, as well as that of its stakeholders.

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