Gartner: Leadership Driving AI Revolution in the Boardroom

In recent years, AI has rapidly transformed the business world, revolutionising everything from customer service to product development. Now, AI is making its way into the highest levels of corporate decision-making: the boardroom. As organisations globally grapple with the implications of AI – both positive and negative – they’re realising that traditional governance structures may no longer suffice.

The rise of AI has fundamentally altered how businesses operate. Companies are leveraging AI to automate processes, gain deeper insights from data and create more personalised customer experiences. This technological shift has created new opportunities for growth and innovation, but it has also introduced complex challenges that demand strategic oversight.

According to a recent Gartner poll, 55% of organisations have established an AI board to address these challenges. This trend reflects a growing recognition that AI initiatives require specialised governance and strategic alignment across multiple departments.

The new AI leadership landscape

While the majority of companies are taking steps to manage their AI initiatives, the leadership structure for these efforts varies widely. The Gartner poll revealed that 54% of organisations have a head of AI or an AI leader orchestrating activities. However, only a small fraction of these leaders hold the title of Chief AI Officer (CAIO).

Frances Karamouzis, Distinguished VP Analyst at Gartner, explains: “AI and generative AI (Gen AI) are complex and far-reaching and touch every job, activity and strategic conversation in the organisation. However, this does not mean that the people or team responsible for orchestrating AI at an organisation have to have a title at the altitude of the C-suite.”

This finding suggests that companies are prioritising the function of AI leadership over creating new C-suite positions, possibly to maintain a leaner executive structure while still ensuring that AI initiatives receive proper guidance and oversight.

The role of AI boards

AI boards serve a crucial function in today's corporate landscape. They are tasked with navigating the multidisciplinary challenges that AI presents, driving value and reducing risk. However, the specific duties and composition of these boards can vary depending on an organisation's needs and use cases.

Frances emphasises that AI boards should have representation from multiple disciplines and cross-business units. This multidisciplinary approach ensures that AI strategies align with various aspects of the business and that potential impacts are considered from multiple angles.

The top focuses for AI boards – according to the Gartner poll – are governance (26%) and strategy (21%). This indicates that organisations are prioritising the establishment of clear guidelines for AI use and the development of comprehensive AI strategies that align with overall business objectives.

Despite the enthusiasm surrounding AI, implementing effective AI strategies is not without its challenges. Gartner estimates that by 2025, 30% of Gen AI projects will be abandoned after proof-of-concept due to unclear business value, escalating costs and inadequate risk controls.

This sobering prediction underscores the importance of having a well-structured AI board that can effectively evaluate the potential of AI initiatives, manage associated risks and ensure alignment with business goals.

As AI continues to evolve and become more deeply integrated into business operations, the role of AI boards and leaders will likely become even more critical. Organisations that successfully navigate this new landscape will be those that can balance innovation with responsible governance, leveraging AI to drive growth while managing associated risks.

The key takeaway for businesses is clear: whether through a formal AI board or other governance structures, organisations need to prioritise strategic oversight of their AI initiatives. By doing so, they can position themselves to harness the full potential of AI while avoiding the pitfalls that come with rapid technological adoption.

“The findings show that organisations are divided regarding if an AI board is necessary,” says Frances. “The answer is yes, businesses need an AI board to transcend the multidisciplinary challenges to drive value and reduce risk. However, the duration, scope, and resourcing is context-specific and use-case dependent. For some, it’s a short-term, stopgap measure. For others, it’s a longer-term change to their operating model.”

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