Could Habib, co-founder and CEO of Author AI, delivered one of many bluntest assessments of company AI failures on the TED AI convention on Tuesday, revealing that just about half of Fortune 500 executives consider synthetic intelligence is actively damaging their organizations — and inserting the blame squarely on management’s shoulders.
The issue, in keeping with Habib, is not the expertise. It is that enterprise leaders are making a class error, treating AI transformation like earlier expertise rollouts and delegating it to IT departments. This method, she warned, has led to “billions of {dollars} spent on AI initiatives which are going nowhere.”
“Earlier this 12 months, we did a survey of 800 Fortune 500 C-suite executives,” Habib instructed the viewers of Silicon Valley executives and buyers. “42% of them stated AI is tearing their firm aside.”
The analysis challenges standard knowledge about how enterprises ought to method AI adoption. Whereas most main firms have stood up AI process forces, appointed chief AI officers, or expanded IT budgets, Habib argues these strikes replicate a elementary misunderstanding of what AI represents: not one other software program software, however a wholesale reorganization of how work will get carried out.
“There’s something leaders are lacking once they examine AI to only one other tech software,” Habib stated. “This isn’t like giving accountants calculators or bankers Excel or designers Photoshop.”
Why the ‘previous playbook’ of delegating to IT departments is failing firms
Habib, whose firm has spent 5 years constructing AI techniques for Fortune 500 firms and logged two million miles visiting buyer websites, stated the sample is constant: “When generative AI began exhibiting up, we turned to the previous playbook. We turned to IT and stated, ‘Go determine this out.'”
That method fails, she argued, as a result of AI essentially adjustments the economics and group of labor itself. “For 100 years, enterprises have been constructed round the concept execution is dear and laborious,” Habib stated. “The enterprise constructed complicated org charts, complicated processes, all to handle folks doing stuff.”
AI inverts that mannequin. “Execution goes from scarce and costly to programmatic, on-demand and ample,” she stated. On this new paradigm, the bottleneck shifts from execution capability to strategic design — a shift that requires enterprise leaders, not IT departments, to drive transformation.
“With AI expertise, it might probably not be centralized. It is in each workflow, each enterprise,” Habib stated. “It’s now an important a part of a enterprise chief’s job. It can’t be delegated.”
The assertion represents a direct problem to how most massive organizations have structured their AI initiatives, with centralized facilities of excellence, devoted AI groups, or IT-led implementations that enterprise models are anticipated to undertake.
A generational energy shift is occurring based mostly on who understands AI workflow design
Habib framed the shift in dramatic phrases: “A generational switch of energy is occurring proper now. It isn’t about your age or how lengthy you have been at an organization. The generational switch of energy is in regards to the nature of management itself.”
Conventional management, she argued, has been outlined by the flexibility to handle complexity — massive groups, massive budgets, intricate processes. “The identification of leaders at these firms, folks like us, has been tied to old-fashioned energy buildings: management, hierarchy, how massive our groups are, how massive our budgets are. Our worth is measured by the sheer quantity of complexity we might handle,” Habib stated. “Right now we reward leaders for this. We promote leaders for this.”
AI makes that mannequin out of date. “When I’m able to 10x the output of my crew or do issues that would by no means be potential, work is not in regards to the 1x,” she stated. “Management is not about managing complicated human execution.”
As an alternative, Habib outlined three elementary shifts that outline what she calls “AI-first leaders” — executives her firm has labored with who’ve efficiently deployed AI brokers fixing “$100 million plus issues.”
The primary shift: Taking a machete to enterprise complexity
The brand new management mandate, in keeping with Habib, is “taking a machete to the complexity that has calcified so many organizations.” She pointed to the layers of friction which have accrued in enterprises: “Sensible concepts dying in memos, the infinite cycles of approvals, the loss of life by 1,000 clicks, conferences about conferences — a loss of life, by the best way, that is occurring in 17 completely different browser tabs every for software program that guarantees to be a single supply of fact.”
Relatively than accepting this complexity as inevitable, AI-first leaders redesign workflows from first rules. “There are only a few legacy techniques that may’t get replaced in your group, that will not get replaced,” Habib stated. “However they are not going to get replaced by one other monolithic piece of software program. They will solely get replaced by a enterprise chief articulating enterprise logic and getting that into an agentic system.”
She supplied a concrete instance: “We’ve got clients the place it used to take them seven months to get a artistic marketing campaign — not even a product, a marketing campaign. Now they’ll go from TikTok development to digital shelf in 30 days. That’s radical simplicity.”
The catch, she emphasised, is that CIOs cannot drive this transformation alone. “Your CIO can not help flatten your org chart. Solely a enterprise chief can take a look at workflows and say, ‘This half is important genius, this half is official scar tissue that has to go.'”
The second shift: Managing the worry as profession ladders disappear
When AI handles execution, “your people are liberated to do what they’re superb at: judgment, technique, creativity,” Habib defined. “The previous management playbook was about managing headcount. We managed folks towards income: one enterprise growth rep for each three account executives, one marketer for each 5 salespeople.”
However this liberation carries profound challenges that leaders should tackle immediately. Habib acknowledged the elephant within the room that many executives keep away from discussing: “These adjustments are nonetheless horrifying for folks, even when it is change into unholy to speak about it.” She’s witnessed the worry firsthand. “It exhibits up as tears in an AI workshop when somebody appears like their previous ability set is not translated to the brand new.”
She launched a time period for a typical type of resistance: “productiveness anchoring” — when staff “cling to the laborious manner of doing issues as a result of they really feel productive, as a result of their self-worth is tied to them, even when empirically AI might be higher.”
The answer is not to look away. “We’ve got to design new pathways to impression, to indicate your folks their worth shouldn’t be in executing a process. Their worth is in orchestrating techniques of execution, to ask the subsequent nice query,” Habib stated. She advocates changing profession “ladders” with “lattices” the place “folks must develop laterally, to broaden sideways.”
She was candid in regards to the disruption: “The primary rungs on our profession ladders are certainly going away. I do know as a result of my firm is automating them.” However she insisted this creates alternative for work that’s “extra artistic, extra strategic, extra pushed by curiosity and impression — and I consider much more human than the roles that they are changing.”
The third shift: When execution turns into free, ambition turns into the one bottleneck
The ultimate shift is from optimization to creation. “Earlier than AI, we used to name it transformation after we took 12 steps and made them 9,” Habib stated. “That is optimizing the world as it’s. We will now create a brand new world. That’s the greenfield mindset.”
She challenged executives to determine assumptions their industries are constructed on that AI now disrupts. Author’s clients, she stated, are already seeing new classes of development: treating each buyer like their solely buyer, democratizing premium companies to broader markets, and getting into new markets at unprecedented velocity as a result of “AI strips away the friction to entry new channels.”
“When execution is ample, the one bottleneck is the scope of your individual ambition,” Habib declared.
What this implies for CIOs: Constructing the stadium whereas enterprise leaders design the performs
Habib did not depart IT leaders and not using a position — she redefined it. “If tech is everybody’s job, you may be asking, what’s mine?” she addressed CIOs. “Yours is to supply the mission vital infrastructure that makes this revolution potential.”
As tens or a whole bunch of 1000’s of AI brokers function at varied ranges of autonomy inside organizations, “governance turns into existential,” she defined. “The enterprise chief’s job is to design the play, however it’s important to construct the stadium, it’s important to write the rule guide, and it’s important to be sure that these performs can win at championship scale.”
The formulation suggests a partnership mannequin: enterprise leaders drive workflow redesign and strategic implementation whereas IT offers the infrastructure, governance frameworks, and safety guardrails that make mass AI deployment protected and scalable. “One cannot succeed with out the opposite,” Habib stated.
For CIOs and technical leaders, this represents a elementary shift from gatekeeper to enabler. When enterprise models deploy brokers autonomously, IT faces governance challenges in contrast to something in enterprise software program historical past. Success requires real partnership between enterprise and IT — neither can succeed alone, forcing cultural adjustments in how these features collaborate.
An actual instance: From multi-day scrambles to prompt solutions throughout a market disaster
To floor her arguments in concrete enterprise impression, Habib described working with the chief shopper officer of a Fortune 500 wealth advisory agency throughout current market volatility following tariff bulletins.
“Their cellphone was ringing off the hook with clients attempting to determine their market publicity,” she recounted. “Each request kicked off a multi-day, multi-person scramble: a portfolio supervisor ran the present, an analyst pulled charts, a relationship supervisor constructed the PowerPoint, a compliance officer needed to assessment every part for disclosures. And the chief in all this — she was forwarding emails and chasing updates. That is the highest job: managing complexity.”
With an agentic AI system, the identical work occurs programmatically. “A system of brokers is ready to assemble the reply sooner than any variety of folks might have. No extra midnight deck evaluations. No extra days on finish” of coordination, Habib stated.
This is not about marginal productiveness features — it is about essentially completely different working fashions the place senior executives shift from managing coordination to designing clever techniques.
Why so many AI initiatives are failing regardless of huge funding
Habib’s arguments arrive as many enterprises face AI disillusionment. After preliminary pleasure about generative AI, many firms have struggled to maneuver past pilots and demonstrations to manufacturing deployments producing tangible enterprise worth.
Her analysis — that leaders are delegating quite than driving transformation — aligns with rising proof that organizational components, not technical limitations, clarify most failures. Firms typically lack readability on use circumstances, battle with information preparation, or face inside resistance to workflow adjustments that AI requires.
Maybe essentially the most putting side of Habib’s presentation was her willingness to acknowledge the human price of AI transformation — and demand leaders tackle it quite than keep away from it. “Your job as a frontrunner is to not look away from this worry. Your job is to face it with a plan,” she instructed the viewers.
She described “productiveness anchoring” as a type of “self-sabotage” the place staff resist AI adoption as a result of their identification and self-worth are tied to execution duties AI can now carry out. The phenomenon means that profitable AI transformation requires not simply technical and strategic adjustments however psychological and cultural work that many leaders could also be unprepared for.
Two challenges: Get your arms soiled, then reimagine every part
Habib closed by throwing down two gauntlets to her government viewers.
“First, a small one: get your arms soiled with agentic AI. Do not delegate. Select a course of that you just oversee and automate it. See the distinction from managing a fancy course of to redesigning it for your self.”
The second was extra bold: “Return to your crew and ask, what might we obtain if execution have been free? What would work really feel like, be like, seem like in case you’re unbound from the friction and course of that slows us down in the present day?”
She concluded: “The instruments for creation are in your arms. The mandate for management is in your shoulders. What is going to you construct?”
For enterprise leaders accustomed to viewing AI as an IT initiative, Habib’s message is evident: that method is not working, will not work, and displays a elementary misunderstanding of what AI represents. Whether or not executives embrace her name to personally drive transformation — or proceed delegating to IT departments — might decide which organizations thrive and which change into cautionary tales.
The statistic she opened with lingers uncomfortably: 42% of Fortune 500 C-suite executives say AI is tearing their firms aside. Habib’s analysis suggests they’re tearing themselves aside by clinging to organizational fashions designed for an period when execution was scarce. The treatment she prescribes requires leaders to do one thing most discover uncomfortable: cease managing complexity and begin dismantling it.
