Study Explores Value Of Autonomy Over AI

Should employees be given the autonomy to overrule AI as soon as they start in a role or later? A new study explores.

At what stage should people be able to override artificial intelligence (AI) in the workplace?

University of Auckland Business School lecturer Dr Frank Ma and University of Western Australia researchers Stijn Masschelein and Vincent Chong enlisted 161 people to participate in a series of online tasks and questions to find out.

Their analysis shows that it’s better for businesses to empower staff to have the final say over computer or AI decisions as soon as they start in a role rather than later.

“Say you’re a financial specialist at a bank and you enter details about a mortgage application into the system. Based on the information entered, the AI-based recommendation might be to decline the application,” says Dr Ma.

“However, as a human, you’re typically more aware of the nuances of the application or the so-called ‘soft’ information that’s been provided, which the computer system can’t incorporate into its decision-making process.”

The researchers also examined how incentive pay contracts impact employee motivation and learning when paired with decision-making autonomy.

“If staff are given the flexibility from the beginning to override the computer-generated decision paired with an incentive pay contract, we find that this bodes well in terms of their overall knowledge and ability to understand the task.”

In addition, Dr Ma says the combination of early autonomy and an incentive pay scheme (piece-rate pay), is motivating and enhances learning.

“Whether and when to override AI decisions is already a big issue in industries including banking and manufacturing, and it’s going to become one in many others that use algorithms for managerial decision-making.

“Overall, our study shows that giving early autonomy to employees is critical to their learning. Firms can’t treat employees as robots; humans can pick up on nuances that artificial intelligence can’t, so people need the power to make the final call.”

Giving employees immediate flexibility, he says, provides more opportunities to override system decisions, and incentive pay ensures that employees put more effort into making the final call accurately.

“Employees with incentive schemes and immediate flexibility get a better understanding of their roles and improve their performance. We believe this is due to developing a more in-depth understanding of how the computer system or AI generates its decision.”

Meanwhile, Ma says the study shows that restricting employees’ power to make the final call until later is demotivating.

The working paper: ‘Incentive contracts and the timing to introduce flexibility on employee learning’ won the best paper award (management accounting) at the Accounting and Finance Association of Australia and New Zealand conference 2024.

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