The executive’s formula to AI success

This blog post was originally published on the Peak AI blog.

Maximizing business performance by improving your decision making and output

We all make around 35,000 decisions every day. While 95% happen subconsciously, the remaining 5%—roughly 1,750 decisions—require active attention. These conscious choices ultimately determine company performance, and in the AI era, how we approach them is changing everything.

Your performance is your decisions

Here’s a simple truth for any executive or business leader: your performance directly correlates to your company’s output. Whether you’re running a team, a division, or the entire organization. And, business performance is the sum total of all decisions made; from daily operational calls to strategic investments taken years ago.

That creates an interesting challenge. Leaders are responsible for the quality of decision making across their organizations, yet are often far removed from where many of those decisions happen. This distance is why intuition and experience matter so much in leadership roles. But experience doesn’t automatically guarantee accuracy — and accuracy alone doesn’t always equal performance.

The business performance equation

I believe that at the heart of business performance, there’s a simple but powerful formula:

Output = decision accuracy × resource performance

In other words, the output (or performance) of our business is governed entirely by the accuracy of our decisions multiplied by the performance of all of our resources. This is an important and powerful framework; one that I believe should sit at the core of how we think about leadership and performance.

Why? Think about it like this. A brilliant decision with zero resources behind it won’t deliver anything. Equally, abundant resources coupled with poor decisions won’t get you very far either.

Performance is the result of how decisions and resources interact.

What does resource performance mean?

Resources are not just people. They are all the resources available to your business, and they should increase over time as your equity grows. Resources fall into two groups. Performance combines:

• Fixed resources, such as your IP, product, infrastructure, factories, and brand

• Variable resources such as your people, cash, inventories, and processes

But those resources might just sit there doing nothing, right? They must be deployed and this deployment I call an activity rate. This is the speed and frequency with which those resources are put to work.

In other words, resource performance is about both the mix of what you have and how effectively you deploy it.

The final business performance equation

This means that company output isn’t just about isolated good calls at the top. It’s the sum total of everyone’s decisions, multiplied by how well your resources are performing, and how fast things get done. And as business leaders our job can simply be described as making the best possible decisions, with the optimal resource mix as much as we can, as often as possible.

Optimizing this equation cuts to the heart of leadership performance. And in the AI era, it provides a clear and unique lens for assessing how technology can make the biggest difference.

AI can optimize every part of the business performance equation

If output equals decision accuracy multiplied by resource performance, then the role of AI becomes clear: it’s a technology that can be used to optimize each part of that equation.

When evaluating AI opportunities, the key question to ask is simple:

Does this initiative improve accuracy, resource performance, or activity rate—and therefore output?

AI can be particularly impactful across these three levers:

Improving decision accuracy

AI helps leaders move beyond intuition. For example, AI-powered pricing optimization can simulate thousands of markdown scenarios, letting you target specific sell-through, margin, or revenue goals with confidence instead of relying on gut instinct.

Boosting activity rate

Automation speeds up decision cycles. What once took days of manual analysis can now be done in minutes. That means you can make more decisions across the entire range of your business, not just focus on the outliers (your bestsellers or worst performers).

Optimizing resource performance

AI continuously rebalances how resources are deployed—adjusting inventory, reallocating cash, or refining staffing levels—based on real-time conditions instead of static, periodic reviews.

The beauty of this framework lies in its simplicity. No matter how complex the AI initiative, you can always evaluate it by asking: which part of the equation does this optimize?

If it doesn’t improve accuracy, resource performance, or activity rate, then it won’t meaningfully improve business output.

The bottom line

Your role as a business leader is to maximize output by making the best possible decisions, with the optimal mix of resources, as often and effectively as possible. And AI doesn’t change that responsibility, but amplifies it.

The leaders and organizations that thrive in the AI era won’t just be the ones who adopt the flashiest or most advanced tools. They’ll be the ones who use AI deliberately and strategically to sharpen decision accuracy, accelerate activity, and get the most out of their current resources.

That’s the real test for AI in business—it’s not about how advanced it looks or sounds, but whether it makes the equation work harder.