Nonprofit Boards Should Consider the Implications of Artificial Intelligence (AI)
BY: Eugene Fram Free Digital Image
AI is rapidly being implemented in many environments, some with aggressive intensity. Walmart, for example, will be replacing 7,000 jobs with artificial intelligence powered technology. Foxconn will be replacing 60,000 factory jobs with machines. * While this is a minuscule portion of Walmart’s total employment, it presents a new reality—machines create fascinating outputs that require less energy to produce and do so at lower costs. They are capable of making decisions, regardless of skill level. *
What Nonprofit Skill Levels Might be At Risk
- Those performing routine tasks that can easily be displaced by automation, even when some human judgment is required—call center employees, bookkeepers, computer programmers, etc.
- Those that involve augmenting skills that can be disrupted—executive assistants, scheduling personnel, fund development specialists, purchasing agents etc.
- Those with high-level skill levels involving human judgment that can be disrupted—social workers, consultants, a variety of “assistant to” positions, etc. (Since 2011,for example, Goldman Sachs replaced 600 desk traders with 200 coding engineers to develop and maintain an automated trading system. Traders normally receive extraordinary wage premiums for their trading skills.)
Attempting to project how AI might impact nonprofit organizations leads me to the following conclusions:
- The displacements of those performing routine task are already accomplished facts. Automated phone calls from marketing research organizations, and the work of bookkeepers can be transferred to organizations that specialize in specific tasks-, e.g. completing and mailing 1099 forms. The big question for nonprofits is whether or not to acquire these platforms internally, a capital expenditure, or buy/rent the services from others. A great deal depends on whether or not it is better to invest in AI platforms or in client services.
- New tools can disrupt the positions of those who perform augmenting services in disturbing ways. A person maintaining an information base on donors may be required to learn how to manipulate an AI information base that produces information in seconds instead of hours. But it also reduces the time needed to do the job from 40 hours a week to 20 hours.
- I suspect that many nonprofit staff positions can be disrupted because machine learning for routine aspects of the job can replace some human judgments. Assume, for example, that a group of agencies can share the cost of a platform that significantly improves the client intake process and maintains records. The economic gain from the improvement may allow the organizations to operate more effectively and efficiently with smaller professional staffs.
What Does AI Mean to Nonprofit Boards?
- Keep abreast of AI changes taking place in the nonprofit’s business operations, especially those where machine learning is replacing human judgment, e.g., analyzing large donor bases. AI is still in an infant stage. Be cautious of moving too fast.
- With management, try NOW to assess the operational areas that might quickly be impacted by AI. All of this is s function for a generative board leadership pattern.