Schrage, M., & Kiron, D.
(2024, October 29).
MIT Sloan Management Review
Better choices enable better decisions.
Profitably thriving through market disruptions demands that executives recognize that better decisions aren’t enough — they need better choices. Choices are the raw material of decision-making; without diverse, detailed, and high-quality options, even the best decision-making processes underperform. Traditional dashboards and scorecards defined by legacy accounting and compliance imperatives reliably measure progress but can’t generate the insights or foresight needed to create superior choices. They weren’t designed for that.
Generative AI and predictive systems are. They can surface hidden options, highlight overlooked interdependencies, and suggest novel pathways to success. These intelligent systems and agents don’t just support better decisions — they inspire them. As greater speed to market and adaptability rule, AI-enhanced measurement systems increasingly enable executives to better anticipate, adapt to, and outmaneuver the competition. Our research offers compelling evidence that predictive and generative AI systems can be trained to provide better choices, not just better decisions.
Machine-designed choices can — and should — empower their human counterparts. As Anjali Bhagra, physician lead and chair of the Automation Hub at Mayo Clinic, explains, “Fundamentally, what we are doing at the core, whether it’s AI, automation, or other innovative technologies, is enabling our teams to solve problems and minimize the friction within health care delivery. Our initiatives are designed by people, for the people.”
Leaders, managers, and associates at all levels can use intelligent systems — rooted in sophisticated data analysis, synthesis, and pattern recognition — to cocreate intelligent choice architectures that prompt better options that in turn lead to better decisions that deliver better outcomes. Coined by Nobel Prize-winning economist Richard Thaler and legal scholar Cass Sunstein in their book, Nudge: Improving Decisions About Health, Wealth, and Happiness, the term choice architectures refers to the practice of influencing a choice by intentionally “organizing the context in which people make decisions.”
The article is linked above.
Here are some thoughts summarizing the article:
Artificial intelligence is fundamentally reshaping organizational decision-making and productivity by moving beyond simple automation to create "intelligent choice architectures." These AI-driven systems are capable of revealing previously unseen options, highlighting complex interdependencies, and suggesting novel pathways to achieve organizational goals. This results in improved decision-making through personalized environments, accurate outcome predictions, and effective complexity management, impacting both strategic and operational decisions. However, the ethical implications of AI are paramount, necessitating systems that are explainable, interpretable, and transparent. Ultimately, AI is redefining productivity by shifting the focus from mere outputs to meaningful outcomes, leading to significant changes in organizational design and the distribution of decision-making authority.
