More than half of CEOs globally say AI hype is distorting boardroom judgement as a fear of missing out means some boards are racing to adopt the technology too quickly, according to research from Boston Consulting Group.
The Split Decisions: The BCG CEOs and Boards Survey found that more than half of CEOs believe their boards need to better understand the gap between AI hype and reality, with 61% of CEOs believing their boards are rushing AI transformation, revealing a high-level disconnect on AI strategy and execution.
While 75% of board members believe they understand AI, 35% of CEOs say boards overestimate the human capabilities that AI can replace, while nearly 40% say boards lack an informed view of how AI is reshaping growth strategy.
BCG says board members with lower confidence in their AI understanding are more likely to believe their organisations are moving too slowly on AI adoption.
Julie Bedard, a BCG managing director and partner, said: “I feel this tension so acutely between CEOs and boards. A powerful way for CEOs to bridge the gap between their AI knowledge and their boards’ – especially if they feel there is a deficit there – is for the CEO to personally lead an AI upskilling session for their board to show them the latest AI tools and what they can do.
“CEOs can also bridge the gap by talking about AI in a much more differentiated way to clearly illustrate where AI can be a substitute for humans and where it can complement human work.”
CEOs say they feel under pressure to deliver AI results, believing 35% of their performance evaluation is dependent on delivering a return on AI investment.
However, despite the disconnect around strategy and implementation, about 80% of boards and CEOs believe that prospective board members should have an understanding of how AI can transform their industry.
Judith Wallenstein, a BCG managing director, senior partner and global head of its CEO advisory business, said: “CEOs need to be very intentional about supporting their boards on the same learning journey they’ve taken. But at a much faster pace, with more focus and in a way that builds real understanding rather than just surface-level awareness of how AI can create true competitive advantage for the company.”
The research was based on a global survey of 625 business leaders, including 351 CEOs and 274 board members at companies with at least $100 million in annual revenue.
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