Machine learning

In a 1967 McKinsey Quarterly article, “The manager and the moron,” Peter Drucker noted that “the computer makes no decisions; it only carries out orders. It’s a total moron, and therein lies its strength. It forces us to think, to set the criteria. The stupider the tool, the brighter the master has to be—and this is the dumbest tool we have ever had."

How things have changed. After years of promise and hype, machine learning has at last hit the vertical part of the exponential curve. Computers are replacing skilled practitioners in fields such as architecture, aviation, the law, medicine, and petroleum geology—and changing the nature of work in a broad range of other jobs and professions. Deep Knowledge Ventures, a Hong Kong venture-capital firm, has gone so far as to appoint a decision-making algorithm to its board of directors.


What would it take for algorithms to take over the C-suite? And what will be senior leaders’ most important contributions if they do? Our answers to these admittedly speculative questions rest on our work with senior leaders in a range of industries, particularly those on the vanguard of the big data and advanced-analytics revolution. We have also worked extensively alongside executives who have been experimenting most actively with opening up their companies and decision-making processes through crowdsourcing and social platforms within and across organizational boundaries.

Our argument is simple: the advances of brilliant machines will astound us, but they will transform the lives of senior executives only if managerial advances enable them to. There’s still a great deal of work to be done to create data sets worthy of the most intelligent machines and their burgeoning decision-making potential. On top of that, there’s a need for senior leaders to “let go” in ways that run counter to a century of organisational development.

If these two things happen—and they’re likely to, for the simple reason that leading-edge organisations will seize competitive advantage and be imitated—the role of the senior leader will evolve. We’d suggest that, ironically enough, executives in the era of brilliant machines will be able to make the biggest difference through the human touch. By this we mean the questions they frame, their vigor in attacking exceptional circumstances highlighted by increasingly intelligent algorithms, and their ability to do things machines can’t. That includes tolerating ambiguity and focusing on the “softer” side of management to engage the organization and build its capacity for self-renewal.

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