May Habib, co-founder and CEO of Writer AI, delivered one of the bluntest assessments of corporate AI failures at the TED AI conference on Tuesday, revealing that nearly half of Fortune 500 executives believe artificial intelligence is actively damaging their organizations — and placing the blame squarely on leadership’s shoulders.The problem, according to Habib, isn’t the technology. It’s that business leaders are making a category error, treating AI transformation like previous technology rollouts and delegating it to IT departments. This approach, she warned, has led to “billions of dollars spent on AI initiatives that are going nowhere.””Earlier this year, we did a survey of 800 Fortune 500 C-suite executives,” Habib told the audience of Silicon Valley executives and investors. “42% of them said AI is tearing their company apart.”The diagnosis challenges conventional wisdom about how enterprises should approach AI adoption. While most major companies have stood up AI task forces, appointed chief AI officers, or expanded IT budgets, Habib argues these moves reflect a fundamental misunderstanding of what AI represents: not another software tool, but a wholesale reorganization of how work gets done.”There is something leaders are missing when they compare AI to just another tech tool,” Habib said. “This is not like giving accountants calculators or bankers Excel or designers Photoshop.”Why the ‘old playbook’ of delegating to IT departments is failing companiesHabib, whose company has spent five years building AI systems for Fortune 500 companies and logged two million miles visiting customer sites, said the pattern is consistent: “When generative AI started showing up, we turned to the old playbook. We turned to IT and said, ‘Go figure this out.'”That approach fails, she argued, because AI fundamentally changes the economics and organization of work itself. “For 100 years, enterprises have been built around the idea that execution is expensive and hard,” Habib said. “The enterprise built complex org charts, complex processes, all to manage people doing stuff.”AI inverts that model. “Execution is going from scarce …
