Welcome to The Automated Leader by Wolff Olins

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Automation, we’re told, destroys jobs. Big data gives unprecedented power to its owners, creating a new elite. Algorithms now shape what we see and how we think — and democracy is compromised by the filter bubble. And now artificial intelligence has invaded the C-suite.
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Recent research by McKinsey suggests that ‘Even the highest-paid occupations in the economy… including CEOs, have a significant amount of activity that can be automated’. Is this a threat to the very idea of leadership? Or could machines liberate leaders to lead?
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Last year, we published a wide-ranging report on how leadership practice is changing. Here, we continue the story, with three provocations from us, followed by three thoughtful responses from experts in our network.
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Three provocations from Wolff Olins

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The brain at the edge

Traditionally, organisations collected information at their edges, where they intersect with the outside world, and then interpreted that information centrally, with the CEO at the heart making the final judgements. But in an automated organisation, this analysis and pattern-finding can be done instantly by machines, and the results can be distributed instantly. So in the organisation of the future — rather like today’s most advanced armies — everyone in the field will have the kind of ‘general’s overview’ that used to be available only to the privileged few at the centre. If knowledge is power, power will be everywhere: is that utopia? Or anarchy?

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Everyone’s a football team

This organisational shape already exists, to some extent, in organisations that run on knowledge or creativity. The best-performing sportspeople, lawyers, investment bankers, actors and film directors already earn far more than their bosses at the centre of the organisation — and, in some cases, have power to match their salary. The football team, professional services firm or media production company may then be the model for every organisation, with a small semi-automated centre and a bunch of star performers, most of them probably freelance, at the edge. And if every semi-automated centre is much the same as every other, will the stars stay loyal? Or will the permanent, stable corporation become a thing of the past?

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All leadership is creative

One thing that’s hard to automate (so far) is creativity. Most of the human beings in an organisation will be doing something creative. Like all creative people, they will need careful managing — or rather, something more sophisticated than just ‘managing’. They’ll want a subtler, more equal, more imaginative kind of relationship. And the people at the centre will themselves be doing work that‘s not analytical (the machine does that) but creative — not interpreting what already exists but imagining what doesn‘t. All of which means that leadership will become creative in three senses: leading creative people, by being creative about relationships, while also being highly creative yourself. This is emphatically not what‘s traditionally taught in business schools. Can today‘s leaders adapt? Or will the next generation of leaders be a completely different kind of animal?

Three responses from our network

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Murmurations of starlings: Dawn Austwick, CEO, Big Lottery Fund

So 40% of what we C-suite characters do will be automated in our digitally enabled, AI- driven, global future. Hurrah — that’s 40% more time to spend on relationships, having fun, or heaven forfend, going to the beach. Having just read about a Swedish hospital where productivity and well-being went up when hours went down that sounds like a win-win.

Of course the question this proposition really begs is “what’s the point of leadership”? And does it change in the new world order? Old approach, new context? I’ve long thought that the Chief Exec’s role is to enable the organisation to act like those magnificent birds flocking at sunset. In these murmurations the birds, often starlings, act in minutely calibrated unison — they avoid the pylons; don’t crash into the ground or each other; stretch and shrink their shape; turn, reverse, accelerate, slow down, and head off on the journey south adjusting to circumstance and each other as they go.

The question this proposition really begs is ‘what’s the point of leadership? And does it change in the new world order?’ ”

How can this happen in an organisation? Well the football team analogy holds good here too: it’s about all that exceptional expensive talent playing for the team, and the C-suite, itself a team, has to invest time, reflection, energy, and orchestration to get everyone on the song sheet and in tune. All that automated data and 21st century comms are the tools. They can't create the performance on the pitch but they can free up time to focus on the added value.

The hidden part of that equation is what lies beneath the performance — shared understanding of purpose, values, and direction, honed to the point where choices become intuitive and split second: back to the starlings. And of course an acute understanding of context, the 21st century version of reading the tea leaves, and the ancient art of strategy.

Automated data and 21st century comms are the tools. They can’t create the performance on the pitch but they can free up time to focus on the added value. ”

So what about the talent? The C-suite role is to orchestrate — scouting, hiring, nurturing, deploying, rewarding, and letting go. These aren’t new skills: creative directors (think films, or theatres, or orchestras) have long operated in this way. No command and control to fall back on but a coincidence of interest and trusted relationships. Now that takes an investment of time, thought and energy to fill all our days, so maybe not quite so much time at the beach after all!

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The moral role: James Cornford, Senior Lecturer in Organisational Behaviour, University of East Anglia

Back in March, I went to an event at the Houses of Parliament. In the queue for the ‘airport style’ security, I started chatting with the security guard about new technology, ‘big data’ and artificial intelligence, and their impact on different social groups. The guard was a sharp and insightful conversational partner. “Technology has already destroyed my social class,” he said, “but it’s about to destroy yours.”

The concern that new technology will have a negative impact on jobs is as old as the Luddites. The usual argument is that while technology may destroy some jobs (and renders others dull and unrewarding), it also creates and enhances other jobs. What is new about the argument this time around is that it is not only the jobs of skilled manual workers that are seen as under threat. Recent studies which have tried to model the impacts of new technologies have identified prospective victims among groups who, historically, have been more or less immune to the negative effects of new technology, including many professionals and managers.

The concern that new technology will have a negative impact on jobs is as old as the Luddites. ”

In some ways, I think that we have been here before. In the 1990s we had a massive wave of delayering — the removal of middle management tiers from corporations — which was justified by the notion that all middle managers did was shift information up and down the corporation (in the form of orders from above and reports from below) and that new information and communication technologies could take on these tasks. However, many organisations discovered that the middle managers were much more than just postboys delivering messages — they were, amongst other things, the holders of organisational memory and the key knowledge resource. This was the golden age of early retirement as these ‘redundant’ workers were shed in large numbers. But corporations soon found that, when the chips were down and a crisis hit, it was the same middle managers who they had so recently and expensively made redundant that they had to rehire, as even more expensive consultants, to fix things.

Today it is not just the middle manager who is seen as vulnerable. Technologies such as machine learning or the pattern-spotting analytical techniques associated with big data mean that the cold winds of technological obsolescence now blow though the C-suite — the home of top management. As computers, or rather the algorithms that they run, become increasingly powerful, with the ability to interpret not just numbers but natural language, photographs, video and other forms of data, something like artificial intelligence or artificial creativity appears ever closer.

But is this to make the same mistake again, misunderstanding the real role of the C-suite. One argument is that the Chief role — for that is what the ‘C’ in C-suite refers to — is a moral, rather than a computational or creative role. The Chief is accountable (or should be… they often aren’t as the Bob Dudley affair suggests) and their main role is to take responsibility. Algorithms or computers, whatever else they can do, can’t take responsibility (so, we might assume, they are the perfect corporate psychopaths — the ‘amoral’ corporate manager who is totally dedicated to improving the bottom line). There is evidence that we have always overvalued the impact of the C-suite on decision making (for example, by ignoring the considerable power held by those who set the agendas and provide the thought leadership that generates the raw material of the agenda — issues). The ‘Romance of Leadership’ research shows that we systematically overestimate the effectiveness of leaders — for good or bad. But we still need them to take responsibility.

Middle managers were much more than just postboys delivering messages. They were… the holders of organisational memory and the key knowledge resource.”

A second mistake is to see computers and human beings necessarily in conflict. Eric Brynjolfsson makes a good point when he argues that the most successful chess player in the world isn’t a human grand master, nor is it the latest supercomputer from IBM, but is a team of human grandmasters working with computers. Perhaps the Moneyball story in baseball can make this clearer. When one team — Oakland Athletics — started to use systematic analysis of player data to pick players for a team, instead of using subjective perspectives on which were the good players, they were fantastically successful. Subjective beliefs in individual flair or ‘the hot hand’, or hard-to-measure qualities such as leadership, looked ridiculous in the face of the systematic and scientific use of data. But only until all the other teams picked up the same ‘quants’ techniques and used them to level the playing field. When everybody is using much the same techniques, the more ineffable, unmeasurable and subjective factors re-emerge. The task, and it is not an easy one, is to combine the best of each of these approaches.

It may be, as I have suggested, that this is as much about our social need for a moral narrative as it is about the raw effectiveness of technique. But then moral narratives, every bit as much as business processes or great products, are what brands are built on.

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Automation is liberation: John Hughes, Performance and Leadership, PwC

William Gibson, the visionary science-fiction writer, once said “The future is already here, it’s just not evenly distributed”. It is a fairly safe bet that some C-suites make substantially better use of automation than others. As Gordon E Moore predicted, information processing capacity has been broadly doubling every two years. In modern times, the limits to effective automation are now more to do with human factors. Perhaps it is time to bring Taylorism into the twenty-first century. This idea, also known as scientific management, was always intended to liberate human beings to focus on human factors, such as creativity, ethics and inspiration. This challenge has now arrived at the boardroom.

Where next?

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Clearly, AI will hit leadership. Machines are already good at finding insights in huge amounts of unstructured data — one of the hallmarks of the leader. But when machines make most of the decisions, where does that leave human beings? Our analysis here suggests that, at least in the short term, people will be both the creative and the ethical forces in organisations. But in the longer term, machines will have these skills too: already, IBM’s Watson machine is demonstrating creative powers.

At least in the short term, people will be both the creative and the ethical forces in organisations. ”

So we’ll need to stop fearing the machine – to get over our machine xenophobia — and envisage a future in which leadership is shared between people and machines, and distributed very broadly across organisations. So broadly, in fact, that ‘leadership’ will become an outmoded notion. Maybe what we’ll all experience, people and machines, sharing our natural and artificial intelligence, is a kind of universal intuition.

by Robert Jones, with Mohsin Hamid and Suzanne Livingston

With thanks to

Aaron Shapiro
Huge
Ajay Srinivasan
Aditya Birla Group
Andrew Glincher
Nixon Peabody
Antony Jenkins
Barclays
Arunachalam Vellayan
Murugappa Group
Bhaskar Bhatt
Titan
Brian Kelley
Keurig Green Mountain
Chris Saul
Slaughter and May
D. Shiv Kumar
PepsiCo
David Klein
CommonBond
Dheeraj Hinduja
Hinduja Group
Erika Brodnock
Karisma Kidz
Farah Ramzan Golant
ALL3MEDIA
François Moscovici
White Water Group
G V Prasad
Dr Reddy's
G V Sanjay Reddy
GVK Group
Giles Andrews
Zopa
Grandhi Mallikarjuna Rao
GMR Group
Iyad Malas
Majid Al Futtaim Holding LLC
James Cornford
University of East Anglia
Jeff Dodds
Tele2
Jeff Lawson
Twilio
Jeremy Doutte
Jumia
John Elkington
Volans
John Hughes
PwC
Jonathan Klein
Getty Images
Kalpana Morparia
JP Morgan Chase
Kathleen Murphy
Fidelity Investments
Kathryn Parsons
Decoded
Kelly Mooney
Resource / Ammirati
Kirsty Fuller & Maggie Collier
Flamingo
Krishna Bodanapu
Cyient
Marc Kushner
Architizer
Marty Neumeier
Liquid Agency
Meher Pudumjee
Thermax
Michael Day
Historic Royal Palaces
Mike Arauz
Undercurrent
Mike Cornwell
Insitute of Direct Marketing
Mohamad Bitar
Just Falafel
Muhtar Kent
The Coca-Cola Company
Dr. Mukund Rajan
Tata Sons
Natalie Campbell
A Very Good Company
Nick Serota
Tate
Nisaba Godrej
Godrej Group
Noreena Hertz
University College London
Phil Mirvis
Boston College Leadership for Change Program
Rabea Ataya
BAYT.COM
Ranjit Yadav
Tata Motors
Sal Lahoud
Pave
Simon Nelson
FutureLearn
Stephen Page
Faber & Faber
Tim Armstrong
AOL
Tunde Kehude
A-Post
Winnie Byanyima
Oxfam
The automated C-suite