4 minute read
Most organisations have a technology programme that delivered everything it promised and changed almost nothing in the accounts. The platforms are integrated, adoption looks healthy and teams say they are faster. Yet the finance director still cannot find the return.
It is a familiar pattern. Among UK businesses using AI, 75% report higher workforce productivity, yet 77% have not yet seen any change in revenue. A board can approve an investment, but it takes skilled, integrated leadership to convert one.
The reason is rarely the technology. It is that the digital core and leadership capability are treated as two separate programmes, run by different people, on different timelines and from different budgets. In reality they are one system, and each makes the other more valuable.
A stronger digital core provides better information, greater connectivity and the ability to redesign how work is done. Leadership capability enables people at every level to use those capabilities effectively: to decide what stops, where freed capacity goes and which decisions stay with a human. Together, they create the conditions for a different operating model.
For boards, the test of a digital core is simple: can a decision taken in one part of the business take effect everywhere else without being argued or approved all over again? If it cannot, you have systems, not a core. And because people in every function and at every level use a core, it is only ever as good as their collective capability.
The value chain is straightforward:
better data → better decisions → redesigned workflows → improved productivity → greater capacity → scalable growth → stronger financial performance
Technology sits throughout that chain. So does leadership. Invest in one without the other and the chain breaks somewhere along its length; invest in both, together, and each link strengthens the next.
Most of the decisions that turn productivity into profit are taken below board level, by operations directors, finance managers and team leaders. When nobody claims the capacity the core frees up, work expands to fill it, bottlenecks move, informal checking layers appear and run costs quietly persist. None of these is a technology failure.
Each of those decisions is small, but together they are the entire return on the investment. The organisations getting most value make them deliberately. McKinsey’s 2026 State of AI survey found that nearly three quarters of AI high performers had fundamentally redesigned workflows because of AI, against roughly a quarter of other respondents.
Confidence also tends to stop at the top. Korn Ferry’s Workforce 2025 survey found that 78% of leaders believed they had AI figured out, while only 39% of workers agreed. Where capability thins out through the management layers, the dashboard can show strong adoption while the way work is done barely changes.
The prize for getting it right is growth, not just efficiency. An organisation that can serve more customers, launch new offers or enter new markets without adding cost at the same rate has changed its economics, not just its efficiency.
The cost of getting it wrong is high. Gartner predicts that more than 40% of agentic AI projects will be cancelled by the end of 2027, citing escalating costs, unclear business value and inadequate risk controls. None of those reasons is about whether the technology works. And each failure makes the next attempt harder: an organisation gets a limited number of chances to ask its people to work differently.
There is a slower risk too. AI absorbs the analytical work through which future leaders used to build judgement, so the leadership pipeline can thin long before anyone notices.
An organisation that automates the training ground without replacing it is spending its succession pipeline to fund this year’s productivity gain.
The technology can be built in months; the leadership to convert it takes years. Start both together, as one system, and each strengthens the other. For businesses seeking stronger growth and financial performance in 2027, the case for bringing these agendas together has become hard to ignore.
Read the full insight here or to explore how Rialto builds leadership capability alongside digital investment, get in touch to speak to one of our team
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