Ready or not: AI is driving growth – but are leaders keeping up

The excitement around AI is justified. McKinsey estimates that generative AI alone could contribute up to $4.4 trillion annually to the global economy.

Executives are eager to capitalise on AI's potential - Google's top AI-related search is "How can AI help my business?" Yet, a significant digital skills gap in leadership is creating a roadblock.

Our How the STEM world works: Navigating the new era of AI and trust (HSWW) study shows that 67% of STEM professionals believe AI adoption will drive business growth. As a result, 60% prefer to work for companies that embrace digital tools.

However, many feel their organisations are failing to integrate AI effectively due to leadership's lack of digital literacy. Without digitally-savvy executives, businesses risk stagnating while competitors surge ahead. Leaders must ask themselves: How can AI be integrated into current leadership skillsets? And who should lead digital transformation?

Digital-first requires digitally savvy leaders

As the world rapidly moves toward a digital-first economy, hiring tech experts alone won't be enough. AI adoption must start at the top, with digitally fluent executives who can align technology with business strategy. This is where Chief Information Officers (CIOs), Chief Innovation Officers (CInOs) and Chief Transformation Officers (CTrOs) play a pivotal role.

Embedding digital expertise in leadership sends a clear message to STEM talent: technology is valued, career paths are open, and innovation is a priority. This strengthens employer branding, enhances talent attraction, and ensures digital transformation isn't stalled by outdated leadership mindsets.

Including technology leaders in the executive team also boosts overall C-suite digital proficiency. They have the expertise to connect how the day-to-day benefits of technology accelerate overall business performance, and the platform to communicate this to other leaders. Once executives understand how digital strategies contribute to commercial growth, even sceptical leaders will recognise the value of new tools.

There's a C-suite digital skills divide

Leadership's digital literacy problem isn't just a hypothetical concern - it's already hurting businesses. Our research found that:

• 57% of STEM professionals believe their leaders lack digital skills.
• 82% of employees have requested digital tools, yet only 11% saw approvals.
• 63% attribute this rejection to leadership's lack of tech understanding.

When employees feel their digital innovation efforts are blocked, frustration grows, retention suffers, and progress halts. If businesses don't act now, they risk losing top STEM talent to more forward-thinking competitors.

How to close the digital skills gap at the C-suite level

It's clear a digital divide exists, but leaders can close the gap through strategic upskilling. Companies that upskill their leaders see higher employee engagement - reducing turnover and improving productivity - and faster, smoother digital transformation.

Knowing where to start can be tricky. Here's what we recommend:

1. Prioritise executive training
   Organisations must act quickly to upskill their leaders before it's too late. But many executives don't take part in crucial digital training due to time constraints. However, our research shows that leaders should be first in line. They are the ones who need to make investment decisions and rally their teams to embrace new tech. How can they do this effectively if they aren't informed?
   
   
2. Implement reverse mentoring
   Upskilling leaders isn't just about training. Reverse mentoring - where digital-native junior employees teach senior leaders about technology - can be a powerful approach. It allows employees to demonstrate how AI tools can improve workforce productivity, making leadership more receptive to adoption.
   
   
3. Make AI and cybersecurity top priorities
   Leaders don't need to be IT experts, but they must understand the fundamentals. AI should be the top priority. Our HSWW findings highlight that ineffective AI integration costs STEM professionals nearly six hours per week - each. Meanwhile, AI-powered cyber-attacks could cost businesses $18.6 billion according to VPNRanks. Leaders who upskill in these areas can protect their company and employees from immediate threats, while futureproofing long-term business growth.

When leaders actively engage in upskilling, it demonstrates that they take employee concerns seriously, improving morale. This commitment to learning also signals that executives value innovation and adaptability, setting the tone for a learning-oriented workplace culture. These leaders can inspire their teams to embrace upskilling themselves, creating agile, future-ready organisations.

A digitally literate leadership team benefits everyone

Investing in executive digital literacy isn't just about staying current: it's about staying competitive. You need to have the right skills in the right place, so here are three steps to future-proof your leadership talent strategy:

1. Commit to lifelong learning
   Continuous learning benefits everyone - including CEOs. Incentivise participation and secure executive buy-in by tying training to performance reviews.
   
   
2. Focus on digitally relevant priorities
   Executives don't need to be tech experts, but they must understand the areas that impact business growth. Tailor training so that it aligns with commercial goals, which will keep it relevant and encourage time-poor leaders to take part.
   
   
3. Hire for digital leadership
   Recruiting ready-made tech executives makes digital a priority at the highest level. This helps to make businesses more agile as technologies evolve and gives others in the C-suite time to upskill.