Why AI Is Creating Leadership Challenges (and How to Respond!)

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Managing AI is different from anything I’ve ever had to do in the past.

Before, I could see something coming from far away. I could experiment with new technology before customers or employees even caught on.

But AI is developing so quickly that leaders (including myself!) are just playing catch up. It’s creating a whole new set of challenges for leaders and forcing us to develop coherent strategies and leadership approaches that address generative AI.

But why is AI creating such a challenge?

The obvious answer is that everything is happening quickly. Sure, AI has been around for over a decade, but the new class of generative AI tools like ChatGPT is making these tools accessible to everyone. It basically democratized artificial intelligence.

Now, employees are using AI to draft emails, summarize articles, create meeting transcripts, and outline key learnings. Instead of leadership exerting control and exploring AI in a thoughtful, strategic way, employees are driving adoption — at incredible speeds. 

Leaders typically know what’s happening within their organizations. They manage risks and opportunities. But AI is creating new challenges for leaders to keep on top of everything. And they’re struggling to wrap their arms around the speed and scale of this change. 

So how can leaders respond? 

Four ways leaders can create adaptive space

There’s tremendous pressure coming from employees as they start to use AI. 

It’s tempting, as a leader, to tamp it down. After all, most organizations aren’t built for adaptability. They’re built for operational excellence — and that doesn’t lend itself to the kind of change that needs to happen. 

But these generative AI tools are creating real value, so we need to address the mismatch between the entrepreneurial employee side and the operational side.

So what does that mean for leaders? How does leadership need to change?

1. Create tension.

As leaders, our job is to manage and reduce risk and conflict while also creating change — not to maintain the status quo.

When you’re driving change, you have to manage the dynamic tension between the entrepreneurial side and the operational side. You need to balance the two and ensure that change isn’t uncoordinated or causing chaos. And you need to impose order so the change can be seamlessly integrated into the operational system.

You can’t simply keep things the way they are. So, your job is to create opportunities for this tension to arise in a constructive way, one where employees' entrepreneurial spirit is recognized and encouraged, but within the confines of clear boundaries and guardrails.

The reality: most leaders have no clue this is happening and do little to proactively manage this tension. This is why it's important to...

2. Ask the right questions.

You’ve probably been promoted throughout your career because you’ve always had the answer.

But now, things are moving so quickly, it’s impossible to know everything. So, you need to shift from being the all-knowing leader to one with curiosity — and all the right questions.

Questions help you define common objectives and boundaries — and support your organization’s entrepreneurial efforts. Start asking yourself, “What are the guardrails? What risk does that create? How do we ensure our IP is protected? What opportunities does this create? How do we do this better, faster, cheaper?”

3. Give up the need to be in control while remaining in command.

Leaders are accustomed to being in control. (At least…having the illusion of control!) But given how quickly the AI space is moving, you need to decentralize efforts and initiatives to the edges of the organization where change is actually happening. Give the problem and the power to solve it to the people closest to it — instead of attempting to centralize the entrepreneurial efforts.

Your role is to create an opening for people to try.

At the same time, you need to remain in command -- you need to know what's going on. That means centralizing transparency and establishing sharing and collaboration to ensure everyone knows what everyone else is doing. Thankfully, enterprise collaboration tools have made it much easier to share information — including what works and what doesn’t — across an organization and reduce unintended consequences.

4. Reframe failure.

Most leaders have a terrible relationship with failure. 

But when we think about what’s standing in our way, it’s not the act of failing. It’s the shame and embarrassment associated with not having been successful. 

The goal wasn’t to always be successful, no matter what. The goal was — and is — to move from where you are to a more advanced position and to get better at what you do.

It all sounds simple, doesn’t it? The scripts and practices for accomplishing these things are straightforward. In reality, none of this is easy! We create silos, people protect their turf, middle managers worry about their positions, entire professions are at risk because of these new technologies. 

But if leaders hope to drive change especially with AI, they need to shift their leadership approach, have difficult conversations, identify what needs to be done, and be vulnerable. That’s how we adapt to new challenges and become more effective, more disruptive leaders.

Next week, we’ll continue to dive into AI with a thought-provoking conversation on intelligence — in particular, how AI and human intelligence are the same…and yet very different. I hope you’ll join me on Tuesday, May 16 at 9 am PT! 

Your Turn

I’ve been studying technology for more than two decades, and I’ve always been interested in how leaders deal with disruptions. So, I’d love to hear what leadership challenges you’re experiencing because of AI. Let me know in the comments!