AI is already influencing decisions inside most businesses. Often quietly. Often indirectly.
Many founders believe delegating AI to a team member is efficient.
In reality, they’re delegating judgement — and losing visibility into how decisions are shaped.
This isn’t about becoming technical. It’s about protecting decision quality in a world where leverage has increased dramatically.
Why This Matters
AI doesn’t just execute tasks. It frames problems, prioritises options, and suggests direction.
That means AI is no longer downstream of decision-making.
It sits inside it. If founders can’t:
- frame the right questions,
- apply constraints,
- or interrogate output,
Then AI starts influencing strategy without accountability.
The danger isn’t catastrophic failure. It’s quiet erosion of judgement — decisions that sound right, move fast, and compound in the wrong direction.
That’s why prompt literacy is becoming a leadership issue, not a technical one. This is why technology should amplify strategy, not replace it.
The Hidden Cost of “Let Someone Else Handle AI”
Most founders don’t reject AI outright. They assume someone else can “handle it”.
That assumption creates three problems:
- You can’t validate output: AI rarely signals uncertainty. If you don’t understand how a prompt was framed, you can’t judge reliability.
- You mistake confidence for correctness: Polished language hides shallow reasoning surprisingly well.
- You lose control over decision framing: Small prompt choices can materially change conclusions — especially around strategy, pricing, or prioritisation.
You don’t need to write prompts every day. But you do need to recognise a bad one immediately.
What AI Literacy Actually Looks Like for Founders
AI literacy is not about clever prompts or technical depth. It’s about being able to pressure-test output before it influences decisions.
A founder with basic AI literacy can:
- Ask follow-up questions that materially improve output quality
- Spot generic or context-free responses within seconds
- Apply constraints that stop AI inventing certainty
- Translate commercial context into usable instructions
A founder without it:
- Accepts fluent answers as “good enough”
- Struggles to separate synthesis from insight
- Over-indexes on speed instead of accuracy
- Delegates prompts but still owns the consequences
There is no neutral middle ground.
Either you can interrogate AI output — or you can’t.
Where Founders Commonly Get This Wrong
After working with leadership teams across eCommerce and digital growth, the same mistakes appear repeatedly.
1. Treating AI like a junior employee
Vague instructions in. Over-confidence out. AI is a reasoning engine, not a mind reader.
2. Asking broad questions and mistaking fluency for insight
General prompts produce generic answers — no matter how polished they sound.
3. Delegating prompts without owning outcomes
If AI influences strategy, pricing, positioning, or priorities, you don’t get to opt out of understanding how that output was formed.
These mistakes don’t create obvious failures. They create slow decision decay, which is far more expensive.
A Simple Decision Filter Founders Should Use
This filter removes most of the confusion around AI use.
- If AI output informs strategy, commercial decisions, or positioning — founders need prompt literacy.
- If AI output is purely executional — delegation is fine.
That’s the line. You don’t need to touch AI for admin or content drafts. You do need to understand it when it shapes thinking.
Read our post on how to sequence AI investment responsibly.
FAQs
Q. Do founders really need to understand prompts themselves?
A. Yes — at a basic level. Not to operate tools daily, but to evaluate output that influences decisions.
Q. Can’t this just be delegated to a capable team member?
A. Execution can be delegated. Judgement cannot — especially when AI is involved.
Q. Is this relevant for small businesses or only larger teams?
A. It matters more for smaller teams. Less structure means AI output has a greater influence on decisions.
Q, Isn’t AI improving to the point this becomes irrelevant?
A. AI is improving at language, not accountability. Better fluency increases the risk of misplaced trust, not the opposite.
Key Takeaways
- AI is influencing decisions earlier than most founders realise
- Prompt literacy is about judgement, not technical skill
- Fluent output is not the same as reliable insight
- Founders must understand AI where it shapes strategy
- Delegating thinking is far riskier than delegating execution
Conclusion
AI increases leverage. And leverage amplifies judgement — good or bad.
- Founders who understand how to frame problems for AI make faster, clearer decisions.
- Founders who don’t end up reacting to outputs they don’t fully trust or understand.
AI won’t replace founders. But founders who can’t interrogate AI will be outpaced by those who can.
Prompt literacy isn’t optional because AI is powerful. It’s non-optional because accountability still sits with leadership.
If you want clarity on where AI belongs in your organisation — and where it doesn’t — that’s the conversation I have with clients.