74% of CEOs worry AI failures could cost them their jobs

https://cfo.economictimes.indiatimes.com/news/74-of-ceos-worry-ai-failures-could-cost-them-their-jobs-report/118923383

by mgh2 • 9 months ago

55 73 9 months ago

cfo.economictimes.indiatimes.com

pfdietz• 9 months ago

As well they should.

ludicrousdispla• 9 months ago

I wonder if the remaining 26% worry that AI successes will cost them their jobs.

QuantumNoodle• 9 months ago

74% of CEOs fear losing their jobs within two years if they fail to deliver AI-driven results...

so... "within 2 years" appears to be the runway for which we can expect a more conclusive verdict on AI investment?

nathanaldensr• 9 months ago

"74% of CEOs worry that not feeding the AI delusional hype cycle could cost them their jobs."

nixpulvis2• 9 months ago

This is wild to me. For the vast majority of businesses, AI is not the primary product. The message from the CEO should be: "we are welcome to, and will support you in developing AI solution if they can be proven to provide value to the key metrics and missions of the company". I wouldn't honestly expect most CEOs to be in the position to make the risk/reward evaluation, so I'd be pushing this down on people who knew more about it and who were willing to risk their careers on it. The CEOs should be protecting the quality of their brands and products.

nis0s• 9 months ago

I am confused why CEO salaries are still so high when AI can do most of their work? If companies are looking to improve margins, then decimating CEO salaries is a great place to start. I’d even say it’s a fiduciary duty to act on this sooner rather than later.

No one’s networking is worth hundreds of millions. A reasonable approach is to cap CEO salaries at $2-5M, and invest everything else in the business. How is this already not being done, AI has rendered a lot of their “analysis” common place.

itake• 9 months ago

- CEO salaries are usually quite low as their compensation is mostly stock, not cash.

- CEO salaries, even when they are high, are still a drop in the ocean compared to the company’s revenue or profits.

- Elon Musk and the CEO of Starbucks have very famously been able to boost stocks just by existing…

bpodgursky• 9 months ago

When your observation is that the entire financial world is being irrational and you have an obvious solution, many thoughtful people would reflect upon their own priors.

roommin3• 9 months ago

It isn't irrational if you frame it as people with power aligning with the choices that reward them with power.

Arainach• 9 months ago

The same financial world whose rationality has led companies[1][3] and economies[2] to ruin over and over?

Rational doesn't mean sustainable or wise.

[1] https://bhc3.com/2009/05/11/when-being-rational-kills-your-b...

[2] https://en.wikipedia.org/wiki/2008_financial_crisis

[3] https://news.ycombinator.com/item?id=45745382

protocolture7• 9 months ago

No one’s networking is worth hundreds of millions.

I was with you until here. Honestly, some networking is actually just that good. I dont believe this to be the case universally, but some people can connect people so efficiently that its mind blowing.

A reasonable approach is to cap CEO salaries at $2-5M

Why is this reasonable?

giantg23• 9 months ago

"Honestly, some networking is actually just that good."

Only if we include corruption. Any deal that takes special consider is arguably corrupt.

yieldcrv• 9 months ago

right, I would say more people could be compensated more directly with the company’s performance, revenue, and market tolerance of the shares

as opposed to saying CEO’s should be compensated less

a muuuuch greater amount of dilution would come with that though, I’m for it

tracker15• 9 months ago

I always thought a cap of 100x the lowest paid employee as a raise all boats kind of thing. That said, I think stretch goals with generous monetary incentives should always be possible. If someone increases the value of a company by $10b, I'm not going to be upset if they make $100m, assuming they aren't doing anything shady, immoral or illegal.

bigbadfeline2• 9 months ago

but some people can connect people so efficiently that its mind blowing.

People don't connect people, money do. It's the golden rule and more...

Why is this reasonable?

Because that's where work stops and corruption starts. Anyone who's seen companies prepared for acquisitions by board-installed, "connected" outsiders, knows that side of the story. Or companies sank on purpose by the same method.

crote• 9 months ago

The real question is whether their networking has a value of hundreds of millions to the company, or to the CEO: are they getting hired because those networking skills are genuinely providing a huge value to the company, or are they getting hired because they are so good at networking that they can fool a company into hiring them instead of someone else capable of providing virtually the same value at a far lower salary?

Why is [a CEO salary cap at $2-5M] reasonable?

Why not? It's enough to live a very comfortable life. If you want to, you can retire after a single-digit number of years. Anyone who needs more money clearly has a serious spending problem and shouldn't be anywhere near your company's finances.

And the whole "but look how much money they are making/saving the company" argument you usually hear is bullshit as well. I bet there are plenty of mid-level FAANG engineers who have saved their company literally tens of millions of dollars a year by optimizing some code, but they don't get those obscene salaries either.

It gets even worse once you take into account the bottom rungs on the ladder: paying the CEO tens or hundreds of millions a year would be a lot less problematic if that very same company didn't have workers literally peeing in bottles, having to work around the body of their dead coworker, or having the building literally collapse on their head.

abeppu2• 9 months ago

If you strongly feel that AI is doing analysis and decision-making at a level which is comparable to human executives, you and some like-minded people could try to form a PE group that takes over firms, replaces a highly compensated CEO with a lower compensation one and an OpenAI subscription, and see how you do.

However, only months ago Anthropic published about their autonomous vending machine experiment which had both humorous and interesting but not financially successful. I think maybe we're not to the point where AIs can run businesses. https://www.anthropic.com/research/project-vend-1

fennecbutt4• 9 months ago

Because it's impossible. CEOs are rooted in place not for skill but because of a web of social connections and class divide.

shermantanktop2• 9 months ago

The skill ladder for humans assumes CEO functions require higher and better skills than a vending machine manager. But there's no reason to assume that AI capabilities map to those jobs in the same way.

It's quite possible that an AI would do a better job at CEO than running a vending machine.

And it's quite possible that successful CEOs would not succeed at managing a vending machine. It's almost guaranteed that many will fail, given that some C-level people are selected for risk appetite and social skills over actual business acumen.

surgical_fire• 9 months ago

If you strongly feel that AI is doing analysis and decision-making at a level which is comparable to human executives

I am more inclined to believe that than the fable that AI can operate at Junior Engineer level.

Especially considering how many times the job of a CEO seem to be to string together a word salad to please shareholders to make line go up.

String together word salads to foster a given sentiment is the specialty of AI.

semiinfinitely• 9 months ago

I am confused why CEO salaries are still so high when AI can do most of their work?

maybe thats why you're not a CEO

mothballed• 9 months ago

Having gotten to know several CEOs I have come to the conclusion there is no good way to identify if someone is capable of being a CEO other than having personal connections to investors.

shermantanktop2• 9 months ago

Inverting that makes an interesting test of CEO potential: "if you can understand why CEO salaries are so high, you may be CEO material!"

tester756• 9 months ago

But why are you caring about how much private companies pay to their CEOs?

roommin3• 9 months ago

Massive wealth inequality is a societal problem.

gambiting• 9 months ago

Because in some companies the CEO compensation is a significant portion of the expenses so obviously cutting it would free up cashflow to do other things - but also on a simple human level hearing about yet another CEO getting tens or hundreds of millions in compensation while they announce how sad they are they have to let go 10% of their workforce is just simply gross. I think even in private companies you are allowed to care when this happens, and voice your displeasure with this clearly visible idiocy of the situation.

nostrademons• 9 months ago

The point of high CEO salaries is to align their incentives with the board and shareholders (the people paying them), so that when they are faced with the decision of losing their job vs. fucking over the tens of thousands of people working with them to increase shareholder value, they choose to fuck over the people working with them. Most people would not normally make that choice; it takes a few tens of millions in stock options before someone might contemplate it.

ergocoder• 9 months ago

I’d even say it’s a fiduciary duty to act on this sooner rather than later.

You said it like nobody hasn't attempted it. Many people are trying to solve this. They've replaced small mechanical works like scheduling meetings and reaching out already.

The majority of CEO job is excellent judgement and motivating people. It's difficult to replace that function.

A lot of CEOs are founders and owners. You can bet they want the business to run by itself, so it would free up their time to go do something else. That's the dream. You do realize that these people will earn regardless who runs the business, right? because they are significant shareholders. In a way, you wish for CEOs/founders to be much much much richer.

jedberg2• 9 months ago

I think your complaint is about CEO comp, not CEO pay. CEOs generally don't make a ton of cash (for example the CEOs of Netflix get $3M a year, which is just a bit more than the VPs get). However, they get a bonus based on company performance and a ton of stock.

CEO comp is so high because of the stock, and the fact that stock buybacks are legal. They were illegal until the 1980s.

A quick fix would be to outlaw stock buy backs. The problem with buybacks is that the people who control when they happen are also the ones who benefit when they happen.

GuinansEyebrows• 9 months ago

CEOs generally don't make a ton of cash (for example the CEOs of Netflix get $3M a year, which is just a bit more than the VPs get)

this is a nit, but HEY. THREE MILLION DOLLARS is a LOT of money. like, an unconscionable amount of money in terms of annual salary.

gmadsen• 9 months ago

Two things.

1. Shareholders are entrusting the CEO with their money to turn it into more money. Networking can absolutely be worth that much. Especially at the start up stage, the CEO is selling the ability to build the money maker, which requires knowing the right people. 2. In your hypothetical, who is deciding these high level "investments" into the company? who is accountable for their strategic success or failure?

stuffn• 9 months ago

CEOs afraid of losing their jobs because AI is a hype cycle rather than being concerned they'll put millions out of their own jobs.

Average CEO in a nutshell. CEOs should be reviled.

tracker15• 9 months ago

It's the money people funding the bubble... CEOs are largely just responding to it as part of the money class.

waynesonfire• 9 months ago

That's insanely high. I'm surprised 74% of CEOs can even admit that their job is at risk. I've been made to believe these people are suppose to be narcissistic.

I kept reading and quickly realized this entire report reads like a bunch of bull,

"94% of CEOs believe AI agents could provide equal or better counsel than human board members."

Board members hold CEOs accountable. How is an AI agent going to do that? "hey chatgpt, can I have a raise this year?"

fennecbutt4• 9 months ago

Since when have CEOs been held accountable? When they get let go they get a huge payout and jump to the next place through social connections.

futuraperdita• 9 months ago

Board members hold CEOs accountable. How is an AI agent going to do that?

The lack of oversight is a feature, not a bug, in this case.

more_corn• 9 months ago

There is a winning move. That’s not to play the game.

AI automation is a high risk and the rewards are questionable at best.

Nobody ever got fired for running a profitable business with real employees, creating value for their customers and executing well. Note the word AI is NOWHERE in that sentence.

add-sub-mul-div• 9 months ago

Ironic, I've been thinking of AI-chasing CEOs as NPCs. But in this case as you point out, not playing the game is the more original move.

MengerSponge• 9 months ago

https://www.youtube.com/watch?v=BzAdXyPYKQo

s/ROI/AGI/

It's fiction, but not really. Many companies aren't trying to run profitable businesses that create value for their customers and execute well. They're trying to make a f~*!ton of money all at once.

AI is great if you're trying to surf a bubble and cash out! You don't have to do anything real! You can lose money with an impossible financial outlook, but AGI!

burningChrome• 9 months ago

Most companies have no idea what exactly AI is or what it does.

My company just spend months on several AI initiatives. They created several power point presentations about how we can use AI to automate all of the teams repetitive tasks. Our senior leadership didn't even know that we've been doing automation for almost ten years now.

They think automation IS AI.

Neywiny• 9 months ago

Just like Wi-Fi in Internet, and image editing is Photoshop, definitions get very lost and tangled. Couldn't agree with you more

nandomrumber• 9 months ago

Do these people think that when they open a file on their computer there is literally some Susan walking down to some basement somewhere and retrieving a manilla folder with a ladder.

mateo411• 9 months ago

Well, AI is changing so fast nobody can really tell you what it is.

righthand• 9 months ago

My coworker is supposed to translate React webpage with 100% text and links into html and put in the WYSIWYG editor of the CMS. These are legal pages.

Q: What did he do to solve the problem?

A: pasted the raw react code and asked an Llm to translate it to html.

The Llm did a terrible job. For example, it converted unordered lists to paragraphs with break tags. When I asked why he didn’t just copy the rendered output from the browser, he didn’t know how to do that.

When he was shown how to do that, he said it would be too much work because the rendered output still contained css tags. So he would have to get the Llm to remove the tags for him.

This is an engineer who’s been developing software for at least 10 years, well before Llms even existed. Yet he cannot figure out how to do a simple regex find + replace. He has no clue that he’s wasted a huge amount of time fiddling with Llms.

Everyone thinks AI is a cheat code to their employment video game and I’m looking for a new job now because I’m surrounded by the downfall of humanity.

nixpulvis2• 9 months ago

Automation is so much more general than AI. Automation can be predictable and reliable, whereas AI can be (if you're lucky) easy and powerful, but rarely the reliable.

mr_00ff00• 9 months ago

Automation with code = time consuming because you must build the instructions but will execute correctly basically 100% of the time once written

Automation with AI = less time consuming especially with elaborate rule sets, but it’s a probability model so by definition it will be wrong a percentage of the time

khannn• 9 months ago

CEOs: AI TOOK MY JERB

shmerl• 9 months ago

They shouldn't be shoving AI on everyone then to appease investors who got overhyped about it. Otherwise they reap what they sow.

fennecbutt4• 9 months ago

Pssssh. CEOs have the luxury of not having to worry about that sort of thing. And that fact is proved time and time again.

Even if your buddies don't get you into a cushy position, a multi million salary for a decade or so sets you up. No tears shed.

denkmoon• 9 months ago

You're not thinking about the millions more they could have. These people don't want some of the money, they want all of the money.

babypuncher• 9 months ago

Of course, but it's easy for them to give into that when the worst possible consequence for royally screwing up is a comfortable early retirement.

kevin_thibedeau• 9 months ago

They should hedge their bets with blockchain and update their golden parachutes.

kubb• 9 months ago

What are they worried for? They have severance packages.

HumblyTossed• 9 months ago

100% of them don't care that AI is costing OTHER people their jobs.

74% of CEOs worry AI failures could cost them their jobs

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