AI Leadership: Is Your Team Ready?
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How should leaders think about the change that is coming? AI readiness is more than just using a new tool, you need to rethink the People, Process, and Technology paradigm. Most teams and leaders aren't ready for what this means.
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This is part of an ongoing series of articles for Internal Audit Next that I am writing about the impact AI will have on business teams and leaders in the weeks, months, and years ahead. The focus of these articles is to identify ways of thinking that can help leaders successfully navigate the AI-driven business landscape. If you haven’t read it yet, check out my first article in the series, AI Leadership: Focus on the Operating Model.
You Aren't Ready for the Change That's Coming
Over the past year, I have spent a great deal of time working with teams in the audit, risk, and compliance space. I have seen the reality of where we are from both sides. As a former leader of a GRC team and as a service provider. If there is one thing that has become abundantly clear to me, it is that most of your teams are not ready for the change that is now on your doorstep. AI, let’s use this term generally to describe LLM technologies in all its various forms, is changing how we think about how work gets done. If you want to avoid crashing your car early in this AI race, you are going to need to rethink a lot of the sound thinking that probably got you to where you are today. It is time to burn the playbook. In truth, this article really applies to anyone leading a team in business today.
The People, Process, Technology Lens
Up to now, we have traditionally kept these elements of business operations in discrete buckets. We developed roles & responsibilities for our people and defined jobs based on years, sometimes decades, of precedent in our fields. We built processes so we had repeatable ways of making sure that work would get done with consistent outcomes. And we purchased technological tools to facilitate the people following the processes that we built. It all made good sense and when we had to change something about one element it wasn’t very disruptive to the other two.
This is why I have been leaning on the 3-D chess analogy quite a bit these days. I find myself talking often to leaders about how AI is forcing all of us to think about what we do in three dimensions. For those of you not familiar, 3-D chess is pretty much what it sounds like. Imagine three chessboards all stacked on top of each other, where your pieces can not only move on the board at one level, they can move up or down the different boards. This means any move not only has to be considered on the plane in which your piece is placed, but also the board above or below it.
If we apply this analogy to your business operations, consider that each plane of your chess game (each board) is an element of your operations. One for People, one for Process, and one for Technology. AI isn’t just a piece of technology. It can disrupt your process, people, and your technology investments in ways you probably haven’t thought about. I see this playing out daily as I watch teams introduce AI tools to an environment that has remained fairly static over the past 20+ years. They aren't ready for the change that is happening.
The forward thinking leaders are playing 3-D chess. The ones who who may start struggling soon are playing with one board only. Most of us are still operating with a piece of technology (think a data repository tool to manage process and store data about what we are doing) that was built to accommodate a role (people) that was performing a task (process). With AI, I can quickly remove elements of the role and the task because the tool (technology) can perform work that was only possible by a person with a defined process. Your reliance on your technology tools up to now has been to help you understand what and how work was getting done. But the minute you start pulling pieces out and handing them over to AI tools, it suddenly makes the work twice as hard. Meaning whatever value you get from introducing an AI tool is counterbalanced by the additional overhead you end up doing as you try to maintain your old role definitions, process, and data tools (technology). Your people don’t want to change, because they are afraid to lose their jobs. Your AI ROI gains become small wins at best because people are doing the same thing they always did and only using AI as a crutch to make themselves more efficient. In reality, you need to tear it all down and re-architect what’s happen on all three boards.
Let me give you a very real example of how I see this playing out. A team has a set of defined roles that perform specific tasks. They have developed processes to perform those tasks, and invested a great deal of money in their data repository tool to track and report on progress. The leader monitors this because their job, essentially, is to tell senior leaders how their team is doing. Everybody in that situation is reluctant to re-design everything from the ground up because they are too busy and don’t know how. Enter the AI tool which disrupts a little of each element. It takes away parts of a person’s role on the team. It changes the process because you no longer need to do a task that the person always did the same way. It removes the need for tracking the activities in a data repository because it can pretty much report on itself. All the efficiency gains of introducing the AI tool then get reduced because the person doesn’t want their responsibility to change, the process is still followed, and the team keeps using the data repository because nobody has a great idea on how to reconcile the AI tool with how they have been tracking and managing work in the data repository for the past few years.
I have seen this play out dozens of times. It isn’t good for the team, because disruption will come fast and could be extremely painful. It isn’t good for the leader, because the leader will be reporting back that they are only seeing incremental gains from the AI technologies. The forward thinking leaders and teams have already thrown out the playbooks and are now tearing everything down with the intent of building it better and working differently. Emphasis on the working differently here.
Put more bluntly, any leader worth their salt needs to:
Rethink the roles they have on their team and what constitutes an effective team member. The skills of the AI tomorrow are not the skills needed up to now. It is the reality and hard truth. Anybody who refuses to accept that will struggle in the years ahead.
Think of processes based on objectives that leverage guiding principles rather than rigid how-to's. As someone who has built a long career focusing on process and has written thousands of process documents, those days are gone. I hate it, but it isn’t the world in which we live now.
Understand that AI technology will be less about supporting a structure (no longer a tool) and will become a member of the team with role definitions and process (objectives and guiding principles) to drive outcomes.
On that last point, the idea of technology as a tool is a good way to think about where we have come from. Tools are just that. Something that augments a person performing a task. In the world of AI, your technology is actually going to look more like a person performing a task than a tool. Get your head around that. It will help you navigate the uncertainty and change that is coming for all of us.
Where Do You Go From Here?
I hate using the first principles line because it always feels a little snobby when I hear people say it. But this is one situation where it is very appropriate. Leaders need to lock themselves in a room with a few of your most trusted team members who are good at embracing change and start focusing on first principles. From there, I recommend that you do the following:
Define the objective/purpose of your team/function.
What are you trying to do and what constitutes success? Define the outputs (generally) that you need to achieve to be considered a success.
Throw out all notions of how you previously measured success. Those really don’t matter.
Bring AI into the conversation now. Use an AI tool to tell you what role AI can play in achieving the objectives. What are the constraints you need to put on the AI tool? How important is validation and control? Certain teams need greater controls and guard rails, others not so much.
Risk is becoming popular again and I think that’s for a very good reason. The world in which AI is ubiquitous will be one governed and controlled by risk. Use risk assessments to determine what’s needed.
Once you have your objectives, what role AI will play, and a risk profile, you can begin to imagine what a person’s role might be. What skills are needed to run your business function given what you have defined? How many people are needed?
The process always comes last. And I am here to make the case that rigid processes will not help you. Start with the objectives and outcomes you desire to build operational guiding principles. Successful teams will employ team members who have a strong understanding of what needs to get done and be guided by key principles needed to achieve certain outcomes.
Change is constant, embrace it and start leading your team so they will be ready for what's coming.
Michael Pellet is currently a Customer Success leader for Petual.ai, an agentic AI SaaS product in the GRC space. He is the former Leader at Lyft and Salesforce and has spent years as a consultant and operational leader in technology companies. You can learn more about Michael on LinkedIn.
These are the opinions of the editors of Internal Audit Next and/or the writer who authored this article. Any use of this copyrighted material without permission of Internal Audit Next - including training for AI Models - is prohibited. Copyright 2026.
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