By Mostafa Sayyadi and Michael J. Provitera
Mostafa Sayyadi and Michael Provitera argue that executives now have two options to select from with regard to AI technology: either use it or lose it. And if you go for the former, you’d best take into account three concerns: social skills, cultivating intelligence, and responsibility towards society.
All management scholars and practitioners agree that change and transformation are two of the characteristics of this millennium. In the business world, those seeking mediocrity limit innovation and creativity. In the wake of COVID-19, electronic leadership created opportunities. Electronic leadership as a culture is needed today, with many hybrid workers working from home two or three days a week. Now, leaders must prepare to change the culture to adapt to this new business method.
In this new business method, employees are either hired temporarily or are full-time but working hybrid or fully remotely.1,2,3 This causes both anxiety and a feeling of insecurity. Real estate has shifted since COVID-19, and profits, in some industries, have not recovered. Just recently, Denny’s Corporation, the diner restaurant chain, plans to shut 150 of its restaurants. Fifty lower-performing restaurants will close by the end of 2024, while the remaining one hundred will shut down in 2025.
The new world of artificial intelligence has extended its tendrils into everything. Organizations and the employees that work for them are facing surprises, conflicts, and dead ends, with no sign of survival. Recent research showed that 88 per cent of data-com companies believed that the internet would change all imaginable aspects of future business.4 Young people were becoming savvier than their senior colleagues because they grew up with electronics and had the wherewithal to feel confident with modern technology. The current generation of AI is also growing up in a revolutionary atmosphere. Young people provide much more knowledge to society at a rapid rate.
The emergence of AI has opened wide opportunities for tech-savvy employees.5,6,7,8 This also causes intergenerational tensions within companies. Human resources managers are having to hire more tech-savvy generalists. Older employees want to keep things the same, while the younger ones consider that some of the systems used in the past are no longer useful. Older workers mistakenly equate experience with age and leadership scholars have found that age does not determine leadership skill. To solve these intergenerational tensions, this article presents the solution of digital culture for corporations. Much of what we share in this article has been adapted from our book The Future of Business, which summarizes our 30 years of consulting work experience across the globe and will be published by Business Expert Press soon.9
To Solve This Tough Problem, Approach It Differently
The five stages of career concepts include the linear type, the technical expert, the spiral type, and the transitional. Younger people are transitory and technical experts, while older workers are linear.
Transient employees, while mostly overlooked and not important to senior leaders, are, at times, the most important group.
Successful companies represent all aspects of career concepts for both senior and junior employees. The linear employees are leaders that offer both drive and ambition. Technical expert employees, usually middle managers, and supervisors, offer skill and artistry which is especially important for innovation and creativity. Spiral-type employees offer opportunities to gain experience in new things in their specialty and bring knowledge back to the organization. The young, more tech-savvy employee has mastered this function, but they may not be adequately praised and rewarded.
This is where conflict arises between the senior employees and the young employees. The transient employees, while mostly overlooked and not important to senior leaders, are, at times, the most important group. Nurturing the transient employees can serve the organization well when busy seasons occur, since they are much needed when the organization has a large volume of customer traffic. Transient workers can be let go when there is a down period, because these employees go on vacation or travel during down periods. The young workers who are paid well for their tech-savvy knowledge can not only earn a good living, but they can also reap the benefits of their high pay to travel and enjoy their careers.
The biggest problem with implementing this hiring and career planning culture mindset is that the linear employees often feel that the technical experts want to become leaders. This causes conflict because the technical experts may not have a desire to be in a leadership role. There are many strategies for talent management but the model above would be the most appropriate to implement today. The flexibility of the workforce can provide a solid bridge between AI technology, customer relationship management, and managing the product and service. This leads to more ability to innovate and create while maintaining a low-conflict workplace.
Many startups that do not know their users and their needs have not thought of special ways to use AI technology. Some startup organizations believe that AI will rewrite the rules of competition, change the traditional standards of organization management, and provide many opportunities for the growth of businesses. Organizations that are pessimistic will not survive over their optimistic competition. Organizations that are full of pessimists try to enter the AI world as little as possible. Small changes cannot help the organization survive the big digital divide of AI. Victors must rethink and re-engineer the culture, and in many cases, retool the entire organization with the emerging technology of AI. Successful organizations are challenged with old ideas in the field of communication, decision-making, outdated work methods, and insignificant operations. In addition, compensating managerial behavior and rewarding and retaining employees is the road to success.
The established companies in AI today are divided into two main groups: the agile ones and the slow ones. This division is caused by the answers to the questions and their transformation (or not) in the field of using AI. The agile ones have brought the basic business to the AI field faster and earlier than the competitors and they are satisfied with the result of their work and reaching their goal. The slow ones start late and accept the least exploitation of AI, in such a way that they are left behind by their competitors and are unhappy with their achievements. The agile ones have accepted AI with open arms and considered it an opportunity to evaluate and improve the current business and other exploitations of modern technology. Thus, agile companies have dealt with the issue in an organized way and step by step. They do not wait for a unified and codified program to be announced and implemented by the top management. They try different experiences to reach the right process. Then the matter is transferred to the elevated level of the organization’s leadership to get their support to stabilize the program and expand it to the whole country.
Efforts are being made to establish coordination and cooperation with the AI parts of the organization in agile companies. But the slow ones face the issue and transformation very uniquely. They start by denying the new phenomenon. Instead of asking and searching about the capabilities of this emerging technology, they make it seem less important and think that it can be forgotten or used very little. Instead of being flexible and arousing the organization’s curiosity in understanding new differences, they allow their past victories to blind them and imagine that this case can be easily dealt with. Sometimes thoughts are accompanied by anger and blame. This situation only leads to wasting both organizational and human energy, which increases the delay in developing the required organizational capabilities for AI.
The second stage of the work of the slow ones is in the field of transformation, acceptance, and dealing with appearances. Instead of innovation and creativity, they often resort to imitation. Sometimes they also get infatuated with their small victories and underestimate their competitors. They do not deal with deep organizational transformations and, while the agile ones achieve innovation, they just deal with second-hand traditional concepts. The big challenge in front of the slow ones is to pass from the stage of external transformations to real and fundamental transformations. Research shows that the leadership of these companies only embraces it when they witness the obvious efficiency and profitability of this modern technology. Even agile companies need a decent effort to understand the environment and how the AI-oriented world works. The big challenge is to know how various parts act and react, which is quite different from the traditional process. In short, the agile ones enter the AI field with a positive and hopeful vision and (re-)approach the fundamental factors of their culture in a different manner. These factors include:
- They take the strategy of implementation and improvement exercises.
- They open the door to many partners.
- They integrate small, cell-like organizations.
- They create a culture that attracts and maintains elites.
Organizations must create a capacity for themselves that will bring a chain of victory. For this, they need rebellious waves. Traditional management, like the program of traditional theaters, performs new or repeated plays based on a specific script in each section. Each actor is assigned a role and words that they must perform beautifully and always the same. The boundaries are marked in advance and any actor who crosses them will be criticized. Some companies still want to set up a complete program before starting to move. The post-AI corporate world is full of surprises. In our AI implementation project at Sony Group Corporation in Sydney, Australia, a senior manager commented: “We were working in an environment where everything was calculated and clear in advance. The design and supply of each new product took eight to 24 months. Now, in the design and supply chain units of the company, they are advancing at a speed that is difficult for many of us to keep up with.” Innovation is inherently associated with initiative. Because you cannot know the reaction of people to something they have never seen, something that has not been invented yet, or something that has not happened, sometimes people have needs that they do not know well, or they cannot explain them. Nevertheless, as soon as they see them, they accept them.
The culture of innovation is the culture of the future. Following the method of innovative theaters is very suitable for working with AI. This technology encourages rapid changes. For two important and great reasons, leaders cannot wait until everything is ready and aligned, then give the order to move. First, the employees are not controllable, and some do what they want. Second, delay is costly. The post-AI economy has shown that if it is left too late, entry will be difficult, or at least costly. Therefore, if the next reform policy is in progress, any movement is better than standing still. It is better to react quickly than to complete before moving. Companies should put aside everything that hinders movement. You should not wait for a perfect plan, complete information, a careful review of what has happened, and fear of making a mistake. Digital culture requires learning, adaptability, and movement. Agile companies change quickly because they start on time. Agile companies ride on successive waves of transformation and creativity and embrace victories one after another.
Agile companies ride on successive waves of transformation and creativity and embrace victories one after another.
In addition, today’s established companies are forced to immediately open a path to the new world by hiring new actors and new stage designs. By going to the AI new world, companies gradually realize that they must revise traditional operations extensively. A question on two levels of complexity arises for companies:
- Limited level: how should you organize your digital business?
- Broad level: how can you change the entire organization?
The first part requires a more convenient and sincere approach of the company to its customers, while addressing the second part of the question is the big challenge within the organization. Researchers have shown that agile companies are more flexible and cooperative, and by delegating more authority to employees, they operate very differently from conventional companies. In these companies:
- Units and departments cooperate instead of overlapping.
- They see encounters as opportunities for creativity.
- Employees are allowed to do anything.
- Decisions are made by those who are more knowledgeable, instead of just senior.
Working in a digital culture requires the organization to behave like a purposeful and motivated society. Employees with a feeling of membership of the society (instead of mere employment), in addition to performing their duties, also accept responsibility towards others. Organizational integration with the help of AI is different from the traditional centralized organization. Here, we need the flexibility of the structure and empowerment of employees, which results in creativity and innovation. In AI, instead of a bureaucracy, we are facing a society. Bureaucracy has a pyramidal structure, predefined relationships, and command and control. Information flows from top to bottom and as needed by subordinates. In society, in addition to accepting written regulations and laws, members voluntarily undertake many other activities. It is possible that the society is specified in the map and diagram, but there are also emotional links. Society has both physical and mental factors. The traditional walls of separation of organizational units must fall in order to provide the basis for the creation and growth of society. It should also be noted that new walls should not be erected in the nascent society. Six factors are effective in creating a successful organizational society:
- Aligned structure.
- Common methods and discipline
- Multi-channel, multi-way communications
- Integration
- Cross-border communication
- Common identity and common destiny
New challenges and life stability skills in digital culture are life in transformation, continuous transformation, moving forward, omnipresent and never-ending movement, and transformation as a condition of survival. Human capital, like humans in general, usually resists change, and leaders are forced to deal with AI transformation adversaries. There are at least nine reasons for opposing the transformations, as follows:
- Becoming anonymous, fear of credit reduction, loss of position.
- Loss of control, transfer of power and decision-making authority to others.
- Uncertainty and ignorance about what will happen.
- Being surprised, becoming defensive, facing something without warning, and not having a chance to prepare. The existence of differences, unknowns, and inconsistency change with the current habits and thought patterns of the person.
- Doubt in victory, concern for the future, and the ability to continue winning.
- Side effects, worry about affecting other activities and tasks.
- Creating extra work, being faced with new activities, new learning and not having enough time to do them.
- Past resentments, the presence of unpleasant memories because of problems that have never been resolved.
- Real threats, anger from causing pain and harm to change.
Since it is possible to stand still even in safe and calm conditions, leaders must learn the skills to deal with the human aspects of this phenomenon in turbulent conditions. Digital culture needs leaders who have learned well how to jump over obstacles and turn obstacles into organizational commitment. Seven traditional skills are related to innovation-related transformation (expert skills in transformation):
- Harmony with the environment
- Open-mindedness
- Inspirational view
- Alliance creation
- Cultivating work teams
- Persistence in progressing difficult tasks
- Crediting and appreciating expert skills
In the AI transformation, there are no regular and orderly steps. These steps cannot be taken regularly and consecutively. In today’s fast-paced AI world, transformation steps go back and forth easily. Sometimes a group takes responsibility together, or sometimes people join an idea after it is formed, and sometimes they leave innovative ideas to a new leader to implement. The best personal characteristics of leaders that are used in any transformation effort include initiative, self-confidence, passion, and the ability to convince others. Turning these human qualities into an efficient and successful company requires learning some lessons, which are:
- Strength, enthusiasm, and human personality are not enough; other people must also believe.
- Organize data in support of transformation. Make the background memorable and the point of view solid.
- Value the knowledge and experience of internal and external organizations. Use connections to source resources.
- It may take time to get support and start a wave of consecutive coalitions to spread your message as widely as possible.
- Try to minimize the damage to others because of transformation. Listen to those who stand. Sometimes they say things that you really need. Approach them and show that you are with them. If you cannot get them going, leave them out of the organization.
- Choose the movement song according to your conditions. Know the audience. Understand what comes from people and organizations and rely on them. But do not forget the acceleration and proper pressure.
- Persistence and standing work. Follow the execution of works.
- Move with friends and talk with them. In the transformation process, try to make everyone feel good.
In Conclusion
The need for digital culture in the digital age of AI has reached its pinnacle, whether you are on the train or left at the station. AI can have a positive and constructive effect in places where social meaning and concepts are involved. Taking advantage of the capabilities of the AI world depends on the emergence of a well-connected offline community. In a society where face-to-face communication is established in a welcoming environment, AI will increase communication, and expand intelligence, productivity, and group responsibility. In places where social ties are weak, the positive factors of AI will be less effective. We still need more clarification of AI and a wide array of other emerging technologies, and we cannot leave the work completely in the hands of science. Take a stand, digitalize your corporate culture to more effectively support AI and how it impacts your business; or stay at the station. Now is the time to make up your mind or be obsolete.
